As opposed to offshoring, nearshore outsourcing or nearshoring is the practice of outsourcing services to companies located in countries near the United States such as Canada, Mexico and other Latin America countries. Outsourcing to nearshore countries offers lower pay rates while still offering high education rates and convenient operating hours similar to those in the States. Many companies leverage nearshore development as part of a global outsourcing strategy where both nearshore and offshore vendors are used to create a 24/7 working environment. Nearshore software development works very similar to offshore software development (eg India) in that very specific instructions and requirements are pivotal to project success, as is vendor partnership and daily communication with project teams. IT departments who focus on vendor partnerships, communication, and quality requirements for nearshoring have experienced significant cost reductions in staffing and project budgets. Nearshore teams can also be used for support centers such as IT support call centers. Nearshore vendors are also much more likely to provide resources who speak English. Many companies provide nearshore consulting and offshore consulting services and can calculate expected return on investment and benefits from outsourcing.

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