We believe many of you have heard about Ukraine as an IT outsourcing country and you are considering setting up an offshore development center in one of its 5 IT cities. Ukraine’s IT industry has been booming for the last 10 years. Moreover, the overall tech talent pool grew from 91K software developers in 2015 to almost 185K in 2018. Moreover, the IT services export industry reached $4.5 bn in 2018. The Ukrainian IT industry is growing five times quicker than the world’s average. In this blog post, we will try to give a comprehensive, updated overview of Ukraine as an IT outsourcing destination. Also, we outline five reasons why you should consider it when choosing the location for your nearshore or offshore development center:
1. Established IT outsourcing industry
IT industry in Ukraine is marked by over twenty years of continuous growth. It currently includes over 1,000 local and foreign IT outsourcing companies, and 100+ R&D centers, including Boeing, Aricent, Huawei, Siemens, Oracle, Magento, Apple, Samsung Electronics, Microsoft, Deutsche Bank, Gameloft, Skype, eBay, IBM, and others.
- Ukrainian developers are ranked 8th among the most skilled developers in the world, according to the TopCoder Ranking.
- Over 70% of Ukrainian software developers work in offshore development centers that cooperate with American and European software development companies. Therefore, the country's IT specialists have vast international experience and diverse expertise.
- There are over 1,000 of IT outsourcing companies in the country with developers working for Microsoft, Skype, Deutsche Bank, Apple Inc., Bosch, Dell, IBM, and other international and local companies.
2. Strong technical education
Since the mid-90s, Ukraine has been taking steps to improve its education. In 2005, it became a member of the Bologna Process and European Higher Education Area aimed at ensuring more comparable, compatible and coherent systems of higher education.
- There are over 660 higher education institutions in Ukraine with 130,000 annual graduates in STEM disciplines and engineering.
- Private educational establishments have dedicated IT-programs (including STEP, Main Academy, LITS, and others).
- Ukrainian IT community has regular technical meetups and conferences, including IT Arena, iForum, IT Weekend, etc.
3. Convenient location
The time difference can be extremely confusing while dealing with the nearshore or offshore development center. Here’s is what you should know while working with offshore developers in Ukraine.
- Companies operating in Ukraine work in the Eastern European Time Zone with only one hour difference with Stockholm, Berlin, and Paris, the two-hour difference with London and Dublin, and the seven-hour difference with New York and Toronto.
- You can fully align working schedules with the Western European countries and work out a four-hour overlapping schedule with the East Coast of the USA and Canada.
- It takes only one hour to fly to Ukraine from Warsaw and less than two hours from Vienna and Munich.
4. Government support of the industry
The Ukrainian government has canceled more than 450 outdated laws and regulations in recent years. Currently, the state is working on many other legislative documents to improve the business environment in areas identified in the WorldBank Doing Business Index. Key highlights:
- Software developers and producers (IT sector) are taxed at a lower rate of CIT (5%) in the period from 1 January 2013 to 1 January 2023. This makes Ukrainian IT services more affordable and helps many companies set up their own offshore development center in the country.
- Ease of doing business. Ukraine has gone from #152 position in the World's Bank Ease of Doing Business in 2012 to #71 on 2019. This rating covers ease of starting a business, taxation, contract enforcement and much more.
5. The cost factor
An offshore development center in Ukraine enables software development companies to implement projects of any complexity fast and within their budgets. According to the European IT Outsourcing Intelligence Report, companies are likely to achieve about 40 – 60% savings developing software in Ukraine compared to in-house development. For example, a front-end developer salary in Ukraine is 2.5 lower compared to a similar position in the USA.
Why choose N-iX as your offshore software development firm?
N-iX has been providing offshore development services for over 16 years. We have built dedicated offshore teams for a lot of global companies, including OpenText, Lebara, Currencycloud, Fluke Corporation, TuneIn, and others. Here are a few more facts about us:
- Over 16 years of experience working with versatile clients, from start-ups to enterprises from the USA, the UK, Europe, Australia, and Asia.
- Development centers in Kyiv, Lviv (Ukraine), Krakow (Poland), Sofia (Bulgaria), and Belarus, which offer both nearshore and offshore development services.
- Excellent reputation supported by the industry recognition (Clutch, GoodFirms, OpenText and Microsoft partner, GSA, Inc. 5000, Software 500, IAOP, and many more).
- A wide range of services and expertise, including staff augmentation, software product development, QA testing, and others to fulfill your business needs.