Software Development

Why do companies from Germany outsource their IT services to Poland?

date: 21 September 2021
reading time: 5 min

Recent reports and analysis confirm unequivocally that an increasing number of German-based companies is looking for partners abroad, especially in IT-related fields. In this article we will look into the reasons for such a trend and will reveal which country is being increasingly successful in attracting German-speaking clients.

The growing popularity of outsourcing

The popularity of outsourcing IT services has been growing steadily over the past years. As written by Statista, the European IT services outsourcing market is growing and in 2021 exceeds $103,9 bln compared to $93,1 bln in 2016. 

The global digitalisation which accelerated during the COVID-19 pandemic meant businesses decided to speed up their IT development and outsource services to different countries at an unprecedented scale.

Onshore, offshore, and nearshore – what’s the difference

Let’s dive into the world of outsourcing and investigate three different ways outsourcing can be done, depending on its location. When looking to outsource some of your services, you can decide to do it onshore, offshore, or nearshore. But what’s the difference?

When you onshore, you collaborate with a company which is based in the same country as you. When you choose a partner based in a country that’s close to you geographically, you nearshore. When you decide to entrust your services to a country on a completely different continent, you offshore.

Statistics show that the preferred option for German-based businesses is nearshoring. In 2019, 77% of German enterprises nearshored their software development in Europe, while only 23% offshored it to countries based on other continents.

The benefits of outsourcing IT services

Outsourcing IT services to companies based in a different country is often efficient in terms of cost, time, and the quality of service. Companies are looking for external partners when they want to expand their services, develop new software, or need help when dealing with the data they produce.

Why do Germany-based companies decide to outsource their IT services? Finding and hiring new staff is often tiresome, time-consuming, and expensive. It also means you need to sign a contract of employment, which ties you with the candidate you want to hire for a long time. Outsourcing on the other hand means that your project can kick-start quickly, can be done more efficiently, you can use a pool of professionals trained to do exactly what you need them to do, and your collaboration can last as long as there is a need for it.

Where do companies from Germany outsource their IT services?

When looking for the best partner to outsource your IT services to, one cannot overlook Poland. Based in the very heart of Europe, bordering with Germany, in the recent years it became one of the most attractive destinations when it comes to nearshoring IT services. Specialists in Poland are well-educated, they speak foreign languages (German being the second most popular one, after English) and have a very similar work ethic to their German colleagues.

As shown by Statista, IT outsourcing services industry in Poland reached a record revenue of USD 2,255.05 million in 2020, marking five years of continuous growth, and a 112.5% increase from 2016.

Let’s see why so many Western companies decide to nearshore their IT services to Poland.

Benefits of nearshoring IT services to Poland:

1. A large pool of talented IT professionals

For some time now Poland has been known as one of the best sources of highly skilled and experienced IT specialists. According to HackerRank Polish developers are third-best in the world – they start coding very early on (on average when they are between 5 and 10 years old), graduate from very good schools and have great experience in project work.

But it’s not only about the level of education and the willingness to learn. It’s also about the numbers. A report by Eurostat shows that the global shortage on IT staff, which is badly felt by many German enterprises, has not reached Poland as yet. Among European countries, Poland is one of the best in terms of easiness of finding IT professionals.

2. Cost-effectiveness

One of the main problems of IT sector in DACH countries is the high labour cost – it is not only difficult to find talented employees, but the salaries are also fast growing. IT companies in Poland offer good prices but at the same time they offer highly skilled IT specialists with great expertise and experience in doing exactly what you want them to do.

3. Location and similar work ethic

Another huge advantage of nearshoring your IT services to Poland is the location – Poland is at the centre of Europe and is easily reachable. There is no time difference between Poland and Germany, so you can be sure you work at exactly the same time and if you need to meet personally, the travel is easily arrangeable and cost-effective. Also, because Poland is close to Germany, the work ethics in Poland is very similar to that of Germany, making the collaboration easy.

4. Great emphasis on security

Poland is not only known for great developers – it is also one of the leading countries when it comes to cybersecurity. When working with Polish IT companies you can be sure they adhere to the European legislative and that they have the best specialists in cybersecurity, meaning your data and business are safe there.

Looking for an IT partner in Poland?

If you are looking for a reliable, experienced, and skilled partner for your IT projects, look no further. At Future Processing we have been collaborating with a number of German-based companies and have extensive knowledge of the market. If you would like to talk to us about your plans and your business, get in touch today.

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