How SaaS Outsourcing Can Help You Hit Your Growth Goals

SaaS (Software as a Service) economy grows at around 20% each year and shows no signs of stopping. In the wake of the massive shift towards this business model, SaaS outsourcing has become an in-high-demand service among startups and established businesses.

In this article, you will learn why so many companies decide to outsource the development of their SaaS systems and what they gain from it. You will also get a few tips on what to look for in an outsourcing provider if you decide to opt for SaaS outsourcing.

To better understand why SaaS development outsourcing could be your go-to strategy, let’s walk through the main characteristics of SaaS systems and see what it takes to put them to the market.

SaaS is a feature-rich cloud-based solution provided to customers on a subscription or pay-what-you-use basis. As a rule, these solutions combine a range of tools and services for a certain business process (e.g. Dropbox as shared storage and workspace) or domain (e.g. Shopify for eCommerce). Customers get access to these services online using a browser, desktop, or mobile applications.

Here are a few facts about the SaaS model that explain why it is a good candidate for outsourcing:

• SaaS solutions are large and multicomponent. Building even a SaaS MVP with a limited number of features requires significant manpower and takes time.
• Cloud-based SaaS systems leverage different cloud services and tools for data management and have a complex infrastructure that requires continuous monitoring and support.
• These products are meant to always evolve to keep a strong position in the market and retain customers. Providers need to quickly respond to customer feedback and changing needs, add features and integration capabilities, migrate to new technologies and scale up as the user base grows.
• Often, SaaS systems are integrated with third-party services and tools to add functionality and provide rich user experience.

To put it simply, the development, support, and growth of a SaaS system require significant financial investment, diverse tech expertise, and scalable development resources. Importantly, it takes time that is so often against the companies planning to launch new products.

This is why so many organizations opt for outsourcing SaaS development. This strategy provides much-needed flexibility and scalability and helps speed up time to market.

Software outsourcing is an optimal strategy to reduce development costs. Companies around the world benefit from competitive hourly rates offered by nearshore and offshore vendors.

SaaS providers use outsourcing as a cost-efficient alternative to hiring in-house development teams. This strategy brings significant savings both at an early stage of development and later on when the project scales up.

Moreover, outsourcing providers normally bear the cost of recruiting, employment and infrastructure. As a result, SaaS companies save not only on rates but also on operational expenses.

One of the biggest advantages of outsourcing SaaS development is the ability to quickly set up the team and kick off the development.

SaaS projects are labor-intensive — a company needs to hire dozens of specialists with diverse skills only to get a project up and running. This includes BAs, UX/UI designers, architects, full-stack engineers, QA and DevOps. It takes a lot of resources and time to put together a cross-functional in-house team, train people, and then continuously expand as the product evolves.

SaaS outsourcing vendors help their clients solve this problem. They have the process and infrastructure to quickly assemble an entire development team or add people to the client’s growing in-house crew.

Furthermore, people in remote teams often have experience working together. As a result, it takes less time for them to gel as a team, work out processes and get up to speed.

Interested in outsourcing SaaS development and looking for an experienced service provider? Let’s talk!

Fast time to market always gives a business an upper hand. To secure timely SaaS delivery, companies need to be able to add specialists on demand and engage the right specialists at the right time depending on the phase of the project.

However, it’s getting harder to find talent these days. Right now, the whole world is experiencing a severe tech talent shortage on par with increasing demand for top-tier developers.

SaaS outsourcing is a viable response to this challenge. First of all, because this approach provides access to a much wider talent pool. Secondly, it gives SaaS companies the flexibility they need to ramp up their tech teams fast and speed up the development process.

This is one of the most important benefits of outsourcing SaaS development for companies that yet lack expertise in managing large software projects and require extra tech leadership.

We have said before that SaaS products are multicomponent systems. SaaS development requires expertise in building and supporting infrastructure and cloud services, data storage and management, application development, third-party integrations, etc.

SaaS companies often partner with tech providers not only to build engineering teams but also to bring tech and management expertise to their projects. Vendors who regularly work with high-load applications, cloud platforms and other SaaS solutions leverage their experience and help clients select the tech stack, choose third-party services and harness cloud technology.

It’s worth noting that over time tech stack may change and companies have to migrate to new platforms or use new services. It is completely normal today — technologies evolve fast and business has to deal with constantly changing market environment. This change is easier to manage when you have a reliable outsourcing partner who can swap specialists based on new tech requirements.

Last but not least benefit of outsourcing the SaaS development to a tech provider is strategic contribution. When companies work with vendors who have previous experience in their field or generally maintain a strong business focus, they get extra value from this collaboration.

First of all, vendors leverage their knowledge to help clients make the right technical decisions. It may reflect in the choice of technologies, analytiсs, features prioritization and overall development strategy.

Secondly, focus on business objectives and strategic goals is important for the further growth and scalability of a SaaS product. Tech companies that work on SaaS projects for years often contribute to the product strategy and help clients reach their business goals.

Here are a few tips that will help to make the first steps towards choosing a reliable partner.

In years of experience as a technology company, we have seen time and again how important it is for a service provider to understand the client’s business. A vendor who puts time into understanding the client’s domain, target market and business goals can select optimum technical solutions taking into account the client’s capabilities, budget and scope.

Previous experience in developing large cloud-based systems is valuable for SaaS product development outsourcing. Especially, if you consider reaping the advantages of the dedicated team model and plan to hire a team to build your system or a part of it from the ground up. It is not essential, however, for a provider to have the exact domain expertise.

It’s vital to realistically assess if a potential vendor can put together a team based on project requirements and further scale up if needed. As a rule, a proven track record, relevant tech stack and experience in working on similar-size projects help to understand if a service provider has the right capacity.

Look for a SaaS outsourcing provider able to flexibly scale up the team up and down on demand and quickly respond to changes. This will give you the flexibility to change your team composition if your development roadmap and priorities change, saving you time, resources, and overhead costs.

Many outsourcing projects fail because of unmet expectations, lack of transparency, and poor communication. This is why it’s crucial to make sure that a potential vendor is ready to set up an efficient communication framework from day one and has a well-established process that could be adjusted depending on your needs and requirements.

Do you have an in-house team and need to scale it up? Look for a team with specific tech skills? Or consider outsourcing the entire project? Your tech provider should be able to work with the SaaS outsourcing model that best fits your goals.

Team (IT staff) augmentation is a flexible model of extending your in-house team with remote specialists on demand. Remote specialists are fully integrated into your in-house team and work as its natural extension, making a perfect SaaS outsourcing solution for fast-growing projects.

Read: Best practices of software team augmentation

Dedicated team approach refers to putting together a team of remote specialists hired by your tech provider, usually on a long term, to work on your project. The team is fully dedicated to your project and can be either managed by your tech leadership or have a project manager/Scrum Master on the vendor's side.

If you don't have tech specialists in-house and want to outsource SaaS product development from A to Z, you can request product development services. Product development includes the full cycle of SaaS development from discovery to development to further support and scale-up.

Diaceutics, a leading diagnostic data analytics company in the UK, set a goal to develop and launch a SaaS solution for precision medicine in less than a year. To help Diaceutics meet this ambitious delivery goal, we put together a dedicated team of engineers, QA, DevOps, and data specialists, accelerating the timeline and helping them surpass the original target. Outsourcing SaaS project enabled Diaceutics to release the product in only 8 months while staying on budget. Learn about the success of this project here...

Mercans runs a suite of SaaS for global payroll and HRM. In 2019, the company decided to reinvent its brand and, having no SaaS design experience in-house, was looking for skilled design specialists to outsource branding and UX/UI. Our design team developed a unique brand identity, corporate website, and design system and provided UX/UI for the two core SaaS products enabling Mercans to enhance user experience across its services and maintain leadership in the HR tech space. Learn about the success of this project here...

Award-winning travel tech SaaS Lodgify needed to scale up their backend teams with senior engineers to cope with the increasing workload. Partnering with reliable SaaS outsourcing companies would help them staff the teams faster and at a much lower cost compared to hiring in-house. We started working with Lodgify in 2020 and since then have augmented their team with 9 senior .NET engineers, supporting their growth and migration journey to SaaS microservices. Learn about the success of this project here...

If you are considering SaaS software development outsourcing for your project and looking for an experienced and reliable tech partner for SaaS development services, contact our team. We have hands-on experience working with large cloud-based systems across all major domains, including logistics, agriculture, retail, cleantech, travel, and healthcare. We can help you:

• Scale up your SaaS development team with senior engineers, DevOps, QA, and other specialists on demand.
• Transform your SaaS idea into a high-performing SaaS product.
• Design, develop, and scale up your SaaS application.
• Put together a dedicated development team for any stage of your SaaS project.
• Modernize your legacy application by migrating from the ageing stack and moving to scalable future-proof technologies (.NET, Java, Angular, React, Python, Node.js, Amazon Web Services, Google Cloud, Microsoft Azure, etc.)
• Migrate your growing SaaS to microservices for better scalability, agility, and cloud cost control.

We can work as a natural extension of your tech team, a dedicated product team, or offer a flexible collaboration model tailored to your unique project requirements and business needs. Start your SaaS development outsource journey by getting a detailed estimate, development roadmap, and cost benefits for your project.

We singled out 5 major benefits of outsourcing SaaS development. In reality, it is always a combination of reasons that make SaaS firms opt for this strategy. However, as long as the shortage of tech talent continues to rise, we will definitely see the growing demand for SaaS outsourcing.

This post was originally published on October 31, 2021 and updated on January 30, 2024.