With technology advancing so fast and global events fundamentally changing the way business works, previous business models are being completely rehashed, including the concept of outsourcing. Delegation has already given way to partnership, with shared business models and resources.  Speed is also of the essence:  being first onto the market still pays its dividends.  In the middle of all this is the physical location(s) of your outsourcer.  Does it matter anymore and, if so, why?

This blog post will examine why the answer is “YES” and what makes Bulgaria such an exciting and profitable location to choose. The short explanation is that Bulgaria has a high propensity of trained, educated professionals, close to major markets and a rich supply of linguists.  That is not the whole story either… 

Is Outsourcing Still Relevant?  If So, Is IT Outsourcing Worth It?

Outsourcing is a growing industry - in fact, massively growing!  BusinessWire’s expectations are that, by 2027, it will have exceeded $400bn! The pandemic we are all still experiencing is showing just how irrepressible it is.  It has coped with wildly changing conditions and has been at the forefront of additional computerisation of and in the workplace.  The benefits of outsourcing programming facilities are readily visible, as they are for several other services.  Getting your outsourcing partner right will yield not only these benefits but that flexibility we were talking about.  It also gives you access potentially to an international source of abilities, skills and capabilities -   experience paired with expertise and often at a lower cost than that available locally or even with greater government assistance.

So, Outsourcing IT Is Worth It - But How Do You Choose Where?

Looking at outsourcing as an option, you first need to know where it is viable to outsource.  This depends on a macro scale on politics, economics, education with other factors, then on a micro scale, on all of these plus local availability of the skills and personnel you need.  How do you sort through it all?  Here are some basic hints:

• Do your homework on where outsourcing is growing - i.e. where in the world have countries invested heavily in education and skills yet kept rates low - like Europe generally.
• Once you’ve decided on the outsourcing model you want to follow, check out where the standard of those outsourced services is globally respected.  See that the same region uses the software solutions necessary to deliver those services  you are after.  For example, if you are after IaaS using MS Azure and AWS, EMEA are both viable options, whereas SaaS and ITO services are better served by the U.S. and, still, EMEA.
• Look at each country’s technical proficiency:  Coursera produces a world-renowned ranking to help you!   This will help you tick off necessary levels of the various skills with those available in the last twelve months.
• See where each potential partner operates and how they compare.  Check out rankings in Clutch, Toptal or Aciety, to name but three.

Are you still not sure where to outsource to, given all the choice?  Now we go on to explain where Bulgaria is such a good choice!

WHAT DOES BULGARIA OFFER THAT OTHER COUNTRIES DON’T?

Eastern Europe has already made its name for the outsourcing of software development amongst leading world businesses. Clutch has found more than 3500 Web Developers alone in Eastern Europe and over 2500 top software developers accessing a pool of more than 1,3M developers.  There is no surprise then that the major software companies all have branches in the region!

That the Balkans are vying with Asia as an outsourcing destination is evident from well-respected international rankings in various places.  AT Kearney’s latest available Global Services Location Index (from 2019) places Bulgaria, for instance, in 17th place in the world.  The reasons we have given already - its level of trained personnel, financial stability and conditions for doing business, including its heightening bonds with the West and its digital advancement.  For its size, Bulgaria outperforms many of its Asian equivalents.  That tradition of exceptional education goes well back into the ‘70s and ‘80s, with it even hosting the first Olympiad in Informatics (IOI) in 1989.  It has continued to lead that and other such competitions ahead of other more advanced countries like the UK or Germany.

AIBEST’s latest annual report shows how foreign outsourcing brings almost EUR 3bn into the Bulgarian economy and it’s growing.  The growth of outsourcing into Bulgaria is outstripping the average growth of the economy, with it expected to reach a massive EUR 4.7bn by 2022 and represent 8.9% of GDP.  The industry’s operating revenue has been growing at around 20% p.a., which looks set to continue as a result of ever-greater development and adoption of complex solutions. also continues to grow exponentially as a consequence of accelerating transition towards more complicated “knowledge-intense and value-added” solutions.  May 11 2021 saw the launch of the EuroHPC supercomputer in Sofia Tech Park, Bulgaria.  It is Eastern Europe’s most powerful supercomputer and is set to add muscle towards Bulgaria’s ambitions to becoming the region’s powerhouse for research and applied solutions for the public and private sectors, including “bioinformatics, pharmacy, molecular dynamics and mechanics, quantum chemistry and biochemistry, artificial intelligence, personalized medicine, bioengineering, meteorology, and the fight against climate change.”

Bulgaria’s steadfast concentration on maintaining its quality and quantity of output of specialists and experts has transformed it into one of Europe’s top software development outsourcing destinations.  

HOW GOOD IS THIS TALENT POOL? 

Bulgaria won the tag of “Silicon Valley of the Eastern Bloc” during the 80’s. It might have slipped a notch or two in the intervening years but it is clearly back there now!  Annually, over 5,000 students graduate with degrees related to ICT from around 40 different higher education institutions all over Bulgaria  - and, to show how this is growing, that figure only doubles for the past five years.  This is in good part due to the development and acceptance of specialist academies, such as those of SoftUni and Telerik:  these have been accelerating more traditional methods of education but without losing quality, resulting in a large boost in the numbers of available front-end, back-end and full-stack developers as well as quality testers.  The culmination of this effort to satisfy demand has seen the launch of a new master’s program in outsourcing, produced in association with AIBEST and Sofia University “St. Kliment Ohridski”.

Another big difference with the Balkans and Western Europe is that speaking a second language is now commonplace with a third language even becoming the norm. Many kids leave school with proficiency in programming - and not just one but several languages and frameworks. According to national statistics, there are 220 high schools offering ICT courses and all of these combine this with English language courses of very high quality. They also have a long history of technical schools, which have taken up the reins of teaching and training ICT.  Of the specialised ICT schools, many are working hand in hand with IT companies - both Bulgarian and foreign - to provide internships and graduate employment. All this goes to show Bulgaria’s ability to deliver employees with the necessary skills, knowledge and flexibility for the modern world.

OTHER FACTORS

Some other factors come into play in getting such perhaps surprising results from such a small country include:

LOCATION

Bulgaria, as with all the Balkans, is located on a crossroads between Europe, Asia, Africa and the Middle East.  That makes it more convenient for software development outsourcers in all four regions. It also means that the region is used to a steady flow of foreigners moving through its domain.  That in turn ensures a relaxed, multicultural mix of people, ethics, religion and practices.  Improved air connections make it no more than 2 hours from anywhere in Europe but also only 14 hours to the other side of Asia! The availability of flights to the U.S. have also made Bulgaria a successful location for their outsourcing too.

BULGARIAN IT INFRASTRUCTURE 

Slipping slightly from its 11th place previously, Bulgaria is still only the 13th in mobile network speed in the world.  As already mentioned, the country has been developing the Balkan hub, with hubs all round the country.  This has been funded entirely by the country’s Ministry of Economics. Sofia’s Tech Park is such an example, created in 2016 and is the usual home for any science fairs and tech events.  The presence of such world giants like Microsoft and IBM in Sofia ensures these events attract the best of the world’s tech speakers.

LOW COST AND RISK

Bulgaria’s national currency, the lev, is tied to the Euro, giving it the stability of the whole Eurozone. Europe’s business costs also being nearer a par with Asia (so much lower than those in the U.S.) add to Bulgaria’s attractiveness.  In fact, Indeed quotes a starting salary for programmers averaging $127k in 2020, whereas the average programmer takes home between $25k and $75k p.a. (depending on experience).

LOW TURNOVER RATE 

One thing that singles Bulgarian workers out generally from other countries’ are their resoluteness, determination and wish to go above and beyond people’s expectations.  The result of this is employer retention rates being much higher than in other countries.  This has also meant that their employers have been trusted with ever larger and more intricate projects.

CONCLUSION

World rankings show Bulgaria coming out ahead of its near neighbors in its ability to keep up to date, trade worldwide and control its costs. Its overall economic stability, market freedom and level of support to outsourcers are still key factors for locating your IT functions in Bulgaria. Put on top the level of worker skills and specific proficiencies and it’s no surprise that Bulgaria has its reputation for software and IT output.

It’s not easy looking for somewhere that maximises both location and service provision for outsourcing but find that place and it pays itself back in abundance.  Are you still wondering why you should outsource your IT services to Bulgaria? We are here for you!

We are a small group of passionate developers in Plovdiv, Bulgaria, eager to learn about your business and what you do and then create something we will be proud to watch over and over again.

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