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Pros and Cons of hiring a Freelancer vs Full-time Software Developer vs Software Development Company

Building software or application is a complex process that requires time and human resources. Thus, making this strategic decision will significantly determine the outcomes or product future, if you will. So it’s no surprise this dilemma is often met by entrepreneurs.

Going one way or another, each of the alternatives can be relevant for a particular project under particular circumstances. However, at the end of the day, the final decision is taken based on experience, risks and of course the cost of the contractor. Before diving into the pros and cons section consider few aspects.

The questions below will help identify which solution can meet your needs.

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Project Length

When would you like to start working on the project? 

Is it a long-term or short-term project?

Do you need support in project maintenance?

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Project Budget

Do you have a static budget to keep up with or is it flexible for you?

Do you need a designer to create a visual side of the project?

Do you have all the necessary resources to deliver the project?

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Project Knowledge Base

Do you know what technology stack would you like to use?

Do you have project technical specifications listed or you need help with it?

Do you have experience hiring a developer on your own?

Freelance software developer

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Pros

Hassle-free search. Nowadays it is relatively easy to find a freelance developer. With the help of resources like Upwork, Freelancer, Toptal and many more. All you need is to adjust the search filters and you are good to go. Another good source is referrals made by your friends or family. There is always someone who knows someone, right?! 

Easy to navigate. Third-party services like Upwork are very user-friendly. It is convenient to handle the communication process and monitor the developer. Additionally, platforms have several tools to track developer performance like timesheets and desktop screenshots makers which may come quite handy. 

Availability. Freelance programmers make a fast switch from one development project to another. Once they are done with the latest gig they actively seek a new one and there is a high chance they will be willing to start the work immediately.

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Cons

Hard to control. Freelancers tend to disappear or fail to deliver on time with a large-scale project like an app or site. Generally, there are two types of problems here. The first one when the developer was referred to you and he or she actually has a full-time job or project.  However, they are highly interested and willing to take this extra load. Those kinds of developers are often unable to deliver in a timely manner because of that high volume working pace. Additionally, personal circumstances always come in between. Bear in mind, they have to eat, sleep, spend time with family or friends. The second type is a developer who tends to impersonate that they are senior-level professionals when they are not. The lack of knowledge and experience in a specific stack takes them much longer to complete the simple task. A customer, in this case, might be unaware of the situation. Both aspects can sink a startup for a long time. 

No guarantees. Mediator platforms offer many tools to control the freelancer, however, there is no way you can check the code quality unless you are a developer yourself. Some pros even bounce before the project is done to chase that next big client and you can be easily left with terrible and incomplete code. Returning the funds will be a mission impossible object. 

Time involvement. A common misconception that hiring a freelancer is faster than a full-time employee. Developers with affordable rates and good reviews are taken fast. Do not be fooled as with every hiring process it will take time to find a good professional.  You will have to manually search and review the candidates. Then select the list of top ones, pitch them, interview and many more.

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Cost

Average rate $30 – $74 per hour.

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Conclusion
A good option to go with, if its a short-term project and you have ready-made design and a tech executive on board with you who can check out the code quality. However, if you are looking to have a full-cycle software development keep in mind that preparing technical documentation of your project, doing the design, giving budget estimates and ongoing project support these are not something most developers do when they work solo.

Full-time software developer

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Pros

Accessibility. Easy as that, reaching out to the developer who works in the same room or building might be easier. Whether you may need an update or a status about one or another task all the matters can be resolved pretty fast within this one-on-one interaction. 

Motivation. Incentives at the workplace is a good way of accomplishing goals. Full-time employees are often driven by several factors it’s either company perks, a bonus, a payment raise or to retain the employment and monthly income. Those factors keep them focused to work long hours and deliver results on time. 

Brand ambassador. A team member can often become your company advocate by spreading the word and promoting its vision. However, the situation can be easily flipped onto the other side once the employee feels dissatisfied. Even a slight spread of negativity can make a drastic impact on peers and the overall team productivity, so making sure employees feel satisfied is important.

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Cons

Recruitment process. The team is the number one priority in companies of all shapes and sizes. Unlike with other roles, finding a good developer is a very much time-consuming and complicated process. Nowadays there is a high demand for developers on the market, so it literally can take months to find the right candidate. Although keep in mind that competition for the talent is going strong and there is a chance you may fight for one with million-dollars companies, which does not make it easier whatsoever.

Unpredictable circumstances. Startups and business is a fast-paced environment where ideas are built right away otherwise can be picked up by the competition. So if you are limited in time or have a burning deadlines project, do not forget that a full-time employee can get sick, have personal circumstances where the days off need to be taken. In this case, you will have to be patient and wait while there is no progress upon your project.

Onboarding & commitments.  Hiring a full-time employee involves a process of formalization, handling legal, contract issues and onboarding process. It usually takes time to do all of that before the employee would actually start working on the project. To compare with a software development company where you don’t need to bother about all of that as they take care of it for you.

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Cost

The average salary in the United States is $104,862 per year. The number may vary depending on location, developer stack and years of expertise. The overall cost may rise once employment tax, training, health coverage, insurance, and bonuses are included.

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Conclusion

In the long run, a good option to go with. It truly depends on your situation. Consider this, if you have a physical office and available human resources at your disposal and able to run the business without a sacrifice than do the hiring. However, if you do not obtain any of that and need a minimum viable product now than it is a no-go for you.

Software development company

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Pros

Reliability. Unlike the freelancer an incorporated app development company is making sure to legally secure the cooperation process. To give an example, in order to prevent the leakage of any project-related information, it is important to sign a non-disclosure agreement as well as a contract with all the details outlined.  Companies also have a public image to sustain and they usually tend to become a devoted partner and provide excellent customer experience, efficiency, and general satisfaction.

Price range.  The cost of labor is different in each country, so if you are looking into offshore or nearshore companies as you reliable tech partner it may cut the overall cost. In addition, you can make your operations 24-hour by taking advantage of overseas workers in different time zones.

Established workflow. A good dev company will save you time, and money because they have developed workflow from the initial inquiry stage up to project deployment. Communication, task management and code revision, they are all about making cooperation smooth and positive because they are interested in you to come back for more.

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Cons

Variety of choice. As in any other industry, there are literally thousands of software development companies around the globe. It may take some time to choose the right one.

Cost factor. Despite a large number of companies in this sector, pricing rates fluctuate drastically. To break it down there are hourly and project-based rates. Dev firms in India range from $10 to $35 per hour, while US-based goes from $200 to $800. A good alternative might be companies from Eastern European markets, like Ukraine. They are well known for the mid-price range.

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Cost

Average rate $50 – $250 per hour.

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Conclusion

A great option for both short-term and long-term projects. Working with a development company is beneficial in many ways. First and foremost they offer full-cycle development services including design, quality assurance, project documentation which is needed in 99% of cases. Firms have a pool of talents so instead of a single person, your project benefits from many great minds. Security, delivery and ongoing project maintenance is also a considerable advantage of dev companies.

Anna Koval

Anna Koval

Anna Koval is the CEO of Codesurf. Having vast experience working with Silicon Valley & European startups for many years she deeply fell in love with everything tech.

Company

Codesurf is a web & mobile app development house. We help corporate & startup entrepreneurs thrive by bringing their ideas to life.

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