Strategic nearshoring in the Balkans: Accessing high-quality development teams at competitive rates 

Are you feeling the pressure to innovate faster, reduce costs, and find top tech talent - all while staying ahead of your competition? Many companies are realizing that building everything in-house is no longer a sustainable strategy. That’s where nearshoring comes in.

But is nearshoring right for your business? If any of the following sound familiar, it might be:

• Struggling to find qualified developers locally?
• Feeling the squeeze of rising development costs?
• Missing deadlines due to talent gaps?
• Worried about keeping pace with rapid technological change?

If you nodded "yes" to any of these, keep reading.

Let's be clear: nearshoring isn't just about finding cheaper labor. 

It's about strategically leveraging a geographically proximate talent pool to achieve specific business outcomes. It involves transferring business processes to a country where it is cheaper to operate and manufacture compared to the company's current location while maintaining closer proximity to their home market.

Think of it as extending your team, not replacing it.

There is no such thing as "the best nearshore development company", but only the best for you. For example, if you are a multi-national you usually wouldn't want a small company to provide services and if you are a small company, absolutely the last thing you'd want is a large company to whom you have no importance.

When considering nearshoring, you have several options:

1. Setting up your own team

Carefully consider setting up your own team - initially more expensive and slower to high productivity, but you're creating an asset - and helping the country you are focused on. We  can help you do this.

2. Design, Build, Operate, Transfer (DBOT)

If you want to use a supplier, do think of DBOT - design, build, operate, transfer - which is where a company will create a dedicated team for you and, at an agreed price, sell you the facility once it is up and running. This hybrid approach offers the speed of working with a partner while eventually giving you direct ownership.

3. Conventional supplier relationship

If you need a conventional supplier relationship, careful vetting is crucial when choosing a standard provider in Eastern Europe. While this approach works well for specific project needs, it's important to spend time ensuring they're capable and trustworthy before committing.

The partnership selection process: don't rush in

Focus initially not on capability - that is very important of course - but on cultural fit, actually on personal fit.

So don't rush into this - plan around at least a six month program. It can be quicker - but it will take time and if you cut corners you will live to regret it.

Do you trust the company you are engaged with? Don't just trust - test. You know how to assess whether someone is honest, credible and capable - just because it's a different culture, still trust your understanding.

These countries have traditionally dominated the Eastern European nearshoring landscape:

Ukraine provides excellent technical expertise and innovation along with competitive pricing compared to software development companies in Canada, USA, and EU. With a deep pool of technical talent and approximately 20,000 computer science graduates annually, Ukraine has built a strong reputation in the global IT market.

It's worth mentioning that the growing technical expertise and demand leads to gradual increase in labor costs across the region. Yet, skilled technical employee rates remain far more reasonable than in the EU and US. Outsourcing reduces development costs, providing you with clear budget control while accessing world-class talents that may not be available onshore.

Poland offers strong technical infrastructure and EU membership benefits but has seen rapidly rising costs approaching Western European rates.

Belarus provides technical capabilities but comes with significant governance and stability concerns that create business risk.

The Balkans region, particularly Bosnia and Herzegovina, offers a compelling combination of advantages that set it apart from other nearshoring destinations:

1. Exceptional technical talent at competitive rates

While rates across Eastern Europe continue to climb, the Balkans maintains an ideal balance between high-quality technical education and reasonable costs. This creates a sweet spot where clients can access excellent engineering talent without the premium prices of Poland or the Czech Republic.

2. Cultural compatibility with western business practices

The region has a long history of cultural exchange with Western Europe, resulting in compatible business approaches, work ethics, and communication styles. This compatibility significantly reduces the friction that often occurs in more distant outsourcing relationships.

At ZenDev, our Swedish headquarters provides a crucial bridge between cultures. With Swedish-speaking project managers leading our collaborations, we eliminate the communication gaps that plague many international partnerships. 
This dual-culture approach means you receive the cost benefits of Balkan development while maintaining the process discipline and communication clarity you'd expect from a Swedish partner.

3. Strategic geographic position

Located in the heart of Europe, the Balkans offer convenient travel connections to major European business centers. A flight from Stockholm, Berlin, or London to Sarajevo takes less than three hours, making in-person collaboration straightforward when needed. 

The region's position at the crossroads of Eastern and Western Europe creates a natural bridge for business operations.
Unlike distant offshoring options that require exhausting long-haul flights and significant time zone adjustments, the Balkans provide the perfect balance of proximity and accessibility. 
This geographical advantage means you can have face-to-face meetings without the disruption of extensive travel, maintaining the human element that's so crucial to successful tech partnerships.

4. Growing but uncrowded tech ecosystem

Unlike some overheated tech markets where competition for talent has driven up costs and reduced stability, the Balkan's tech ecosystem is developed enough to provide skilled professionals while still offering room for growth and partnership opportunities.

To better explain the concept of nearshoring, we will present you with three examples.

Hidroxa Medical, a distinctive Swedish company that specializes in selling iontophoresis machines to clinics and individuals, decided to nearshore its development, design, and marketing operations to ZenDev. Hidroxa aimed to enhance its competitiveness and expand beyond the Scandinavian market by establishing an e-commerce platform. To achieve this, they sought a partner well-versed in e-commerce technology, digital marketing, and the art of building a digital brand. 

By leveraging the expertise of ZenDev's highly skilled developers, designers, and marketing specialists, Hidroxa experienced a notable boost in its overall revenue, increasing it by 33%. Additionally, they observed a 17% rise in the number of users and a 14% increase in average website session duration.

Another notable example is Kalmar, a leading global provider of sustainable cargo handling solutions for ports, terminals, distribution centers, and heavy industries, faced a significant challenge in digitizing their manual paperwork and data entry processes. This labor-intensive task imposed a heavy workload and involved multiple stakeholders. Kalmar nearshored the development activities to ZenDev, a company that has been serving the Swedish market since 2016. ZenDev's founders, having grown up and been educated in Sweden, possessed a strong understanding of diverse cultures. Additionally, the location of the majority of ZenDev's consultants in Bosnia and Herzegovina offered the advantage of being in the same time zone as Sweden, with direct flights taking only 2.5 hours to reach Gothenburg, Stockholm, or Malmö, and reasonable proximity to other European cities.

ZenDev successfully developed a mobile application that automated Kalmar's workflows. As a result, the app significantly improved the efficiency of operations and communication with customers, leading to an impressive 103% increase in overall efficiency.

Magnetlabbet, a Swedish company specializing in efficient and rapid image diagnostics using the latest medical equipment, recognized the need to enhance its marketing strategies to achieve desired results from paid advertising. They also required a well-developed SEO strategy, prompting them to nearshore their marketing activities. Additionally, they faced technical challenges, such as a predominantly hardcoded website and e-commerce platform that made it difficult to add new content without involving a developer. This resulted in high website maintenance costs for simple tasks, and their checkout solution needed optimization to improve conversion rates. By collaborating with ZenDev, Magnetlabbet successfully overcame these obstacles and achieved impressive outcomes, including:

- An 82.6% increase in organic website visitors. 
- A 110% increase in organic conversion rate. 
- A remarkable 445% increase in paid conversion rate.

ZenDev also provided a customized checkout solution and aided Magnetlabbet in migrating their hardcoded website sections to a drag-and-drop builder, enabling easy content editing without the need for continuous developer support. This resulted in reduced development costs and improved overall efficiency.

For Arvid Nilsson, we implemented a new design, developed over 20 custom APIs, and integrated their systems with Azure. As a result, processes that once took days, like indexing their product catalog, now take just 2 minutes.
Mattias Nordström, Project Sales Manager at Arvid Nilsson, shares: 

"The 110% commitment we received from ZenDev was truly remarkable."

We turned outdated AutoCAD renders into an innovative facility management platform for Zynka. Emil Eek, Head of Development at Zynka, states: 

"We wouldn't have been where we are today if it weren't for ZenDev. They are responsive, quick, and easy to communicate with. We have also successfully raised capital to launch a new company around this innovative platform."

When considering different nearshoring companies, it is a win-win situation to choose a company such as ZenDev that has a wide range of services: software development, team augmentation, UI/UX design, and digital marketing so you can cover more aspects of your business and manage everything in one place, which is also a cost-effective solution.

ZenDev's teams have deep experience working in these various fields for companies in different industries. Feel free to contact our consultants that will be glad to assist you and answer all your questions. Book a free demo call. 

At ZenDev, we believe in:

1. Cultural and personal fit: We focus on building trust and establishing a genuine connection before diving into technical capabilities.
2. Right-sizing for your needs: If you're a small company, the last thing you want is a large provider where you have no importance. We tailor our approach to your scale.
3. Strategic resource allocation: We help you build more with fewer resources, ensuring you get the most value from your investment.
4. Long-term partnerships: We aim for mutual wins that build lasting relationships, not just one-off projects.

Here are some of the reasons to consider nearshoring: 

1. Increased agility and scalability

Nearshoring enables businesses to adapt quickly to changing market dynamics. By leveraging external partners, organizations can scale their operations up or down based on demand, without the need for significant infrastructure investments.

2. Improved focus on core competencies

Outsourcing non-core activities through nearshoring allows companies to concentrate on their core competencies. This strategic allocation of resources can enhance efficiency and foster innovation.

3. Risk mitigation

Diversifying operations through nearshoring can mitigate risks associated with over-reliance on a single location or market. By spreading operations across multiple regions, businesses can reduce vulnerability to geopolitical uncertainties or natural disasters.

Nearshoring isn't right for every situation, but for many Western European companies facing talent shortages and budget constraints, it offers a powerful strategic option.

One of the key considerations for your decision-making process is partnership structure.

Consider which model best suits your needs:

• Staff augmentation for flexible team extension
• Dedicated team for a stable, fully-managed resource
• Project-based engagement for specific deliverables with clear timelines

At ZenDev, we welcome thorough evaluation because our distinctive strengths go beyond surface-level capabilities. With leadership in Sweden and tech teams in the Balkans, we blend a client-first approach with cost-effective, high-quality development. 

Our teams don't just execute tasks - they proactively identify better approaches and bring solutions to the table. We've built systematic quality processes refined through 50+ successful projects. And we encourage potential clients to speak with organizations similar to theirs who have experienced our partnership firsthand. These deeper qualities determine whether a partnership merely functions or truly transforms business outcomes.

If you're considering nearshoring as a strategic option, we recommend a structured exploration:

1. Initial consultation: A no-obligation discussion to understand your specific challenges and objectives.
2. Strategic assessment: Analysis of how nearshoring might address your particular situation.
3. Partnership design: If appropriate, development of a tailored collaboration model that aligns with your needs.

The most important thing isn't to convince you to nearshore, but to help you make the right strategic decision for your business. We've seen firsthand how powerful these partnerships can be when done right - and how problematic they can become when rushed into without proper consideration.

Would you like to explore whether a nearshoring partnership could help address your specific business challenges? Let's schedule a conversation to discuss your project needs in more detail.