Have you ever considered software development outsourcing to Bulgaria? This country has been on the radar for more than a decade, becoming a reliable partner or a delivery center for companies like IBM, Hewlett-Packard, Sutherland, and many others. So what makes this destination so attractive in terms of software product development and IT outsourcing?
To answer this question, we will walk you through:
- State of the tech industry in Bulgaria;
- Tech talent pool and its availability;
- IT hubs in Bulgaria;
- Overview of software development companies in Bulgaria;
- ICT education in the country.
The market of software outsourcing in Bulgaria is growing steadily. Moreover, during the global pandemic, the industry kept working, thus significantly boosting the economy and bringing money to the state budget. Overall, the ICT exports exceeded €1.67B (roughly $1.8B) in 2020. ICT exports account for 2.76% of the country’s GDP. Experts estimate that by the end of 2024, the ICT industry can reach €6.6B in exports (BPO and ITO services combined).
Overall, the most significant industry growth along with the establishment of many new vendors was seen in 2014. Moreover, the overall growth of the BPO sector has also boosted the development of IT outsourcing in the country.
Favorable business climate and development of the industry are the key factors that make any country a suitable candidate for outsourcing. Bulgaria rates high in many international rankings. For example, in the 2021 Index of Economic Freedom, Bulgaria got 36th place out of 165 countries. In the 2021 Global Services Location Index, the country kept its place among the top 20 most attractive destinations for outsourcing.
The government pays a lot of attention to the development of the IT industry. They try to develop it even further and attract new investors and global tech companies, as well as encourage long-term investments.
The second important aspect of IT outsourcing is the availability of tech talent. And while Bulgaria cannot offer the largest pool of experts, this country still possesses plenty of resources. The number of professional software developers and other IT experts in Bulgaria is growing slowly, but steadily. The Future of IT Report shows that the number of ICT specialists exceeded 101,000 back in 2020.
Another report by ABSL suggests that out of all ICT specialists, only 30% are involved in IT outsourcing. The remaining 70% are working for BPO companies or vendors that specialize in Shared or Global Business Services (SSC/GBS). Let’s take a look at the breakdown of the overall tech talent pool by the primary technology or the expertise of IT specialists.
Apart from Sofia, the capital of Bulgaria, there are several other large IT hubs located all over the country: Plovdiv, Varna, Burgas, Veliko Tarnovo, Ruse, Stara Zagora, and Blagoevgrad.
As the capital and the largest city, Sofia houses the largest number of software engineers and IT specialists. Over 80% of companies are either headquartered in this city or have a delivery center here. There are also 13 universities, 41 professional and 30 vocational schools that prepare students for ICT jobs. The second largest city is Plovdiv. Many companies have chosen this city for their secondary offices. There are 28 vocational schools, 10 applied science institutes, and 7 universities that offer education relevant for sourcing. And the third largest city is Varna, which houses offices of 70+ companies and has a variety of educational opportunities as well.
Among the cities that are also HQ to Bulgarian software development companies are Veliko Tarnovo, Ruse, Stara Zagora, Blagoevgrad, and Haskovo. Together, these cities home more than 40+ headquarters of various organizations.
Let’s take a closer look at the vendors that specialize in software development outsourcing in Bulgaria. The lion's share of these companies is small vendors with less than 50 employees or even solopreneurs. On the graph below, you can see that small companies account for almost 74% of all vendors. The other 34.7% are midsize firms that employ between 50 and 999 specialists. And less than 2% of all software development companies in Bulgaria are large vendors with 1,000+ experts aboard.
Another critical component of successful software outsourcing to Bulgaria is the wide domain expertise of vendors in the country. Out of 180 vendors listed under ‘software development in Bulgaria’, many have expertise in delivering software for business services, financial services, IT, healthcare, eCommerce, and consumer products.
However, it would also be easy to find a vendor with a more rare industry expertise like automotive, telecom, or supply chain and logistics. Next, let’s take a look at the geographical diversity of the clients of Bulgarian software development companies. Report  shows that the majority of companies list Western Europe in their portfolio. Almost half of the vendors have experience working with US companies, and 15% are partners with businesses from Central and Eastern Europe.
Overall, the country has a decent number of vendors to choose from. These companies have versatile domain and technical expertise and have experience partnering with clients all over the world.
Another element that makes software outsourcing to Bulgaria so attractive is a developed educational system. There are 50+ universities across 14 different cities, offering STEM, ICT, or other tech and business degrees. As of 2020, the number of ICT graduates exceeded 2,100 people annually.
It is also worth mentioning that the share of IT and STEM graduates is growing slowly but steadily. Since 2016, it grew by 6.3% of the overall number of graduates that are available for sourcing in Bulgaria.
Apart from university degrees, there are many vocational training and secondary schools that help people get the knowledge needed to become a part of the IT infrastructure in Bulgaria.
Overall, Bulgaria became a popular software development outsourcing destination more than five years ago and the country remains popular. The reasonable tech talent pool, a variety of vendors, and favorable business climate make this country attractive for many global businesses.
Why choose N-iX?
If you are considering software development outsourcing in Bulgaria, here are the top reasons to choose us:
- We have over 1,800+ experts aboard and delivery centers in Bulgaria, Poland, and Ukraine.
- N-iX is compliant with international standards and regulations, including ISO 27001:2013, PCI DSS, ISO 9001:2015, GDPR, and HIPAA.
- Our portfolio has multiple projects for fintech, manufacturing, supply chain and logistics, healthcare, retail, and other industries.
- The company is a certified AWS Advanced Consulting Partner, a Microsoft gold certified partner, a Google Cloud Platform Partner, an Opentext Services silver partner, and a SAP partner.
- Our experts have solid expertise in cloud computing, DevOps, data solutions and advanced analytics, machine learning & AI, VR/AR, IoT, and embedded development.
- Future of IT Report by Emerging Europe
- Annual Industry Report by Bulgarian Outsourcing Association
- 2019 & 2021 A. T. Kearney Global Services Location Index
- EMEA’s Business Services Landscape