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Run an offshore development center
If this is the first time you hire a remote team, Turing Alley suggests we could start with a small software development team. It's more productive. It's easier to coordinate and recognize the individual teammate contributions. Therefore, the ideal size should be around 3~5 people.
We maintain the same cost between building the in-house team and build an offshore team with Turing Alley. Let’s say you want to expand at the smallest scale to minimize the spending. The team structure will be something like this:
- One senior backend engineer (5~6 years of experience) as the team leader
- One junior frontend engineer (2 years of experience)
- One junior mobile developer (2 years of experience)
Hiring gross salary
Name | Senior backend 5 yrs as a team lead ($) | Frontend Engineer 2yrs ($) | Mobile Developer 2yrs ($) |
---|---|---|---|
Monthly Gross Salary | 2,300 | 700 | 1,000 |
Monthly social insurance, heath insurance and unemployment insurance (Vietnam)* | 540.5 | 164.5 | 235 |
Annual Hiring Cost Subtotal | 34,086 | 10,374 | 14,820 |
*23.5% of Gross salary
You are paying $59,280 annually for an offshore tech team of 3 people in Vietnam. However, this is only the cost of recruitment and we still have to take care of their welfare and other benefits to improve employee retention.
Welfare and benefit-cost
Due to a large and rapidly expanding demand, the software business has the greatest turnover rate at over 13%, leaving many engineers feeling underpaid. They might feel their employer can't keep up with the market and their increasing skills. This makes employee benefits and compensation become essential.
Name | Team Lead 5yrs ($) | Frontend Engineer 2yrs ($) | Mobile Developer 2yrs ($) |
---|---|---|---|
Annual Office* | 3,600 | 3,600 | 3,600 |
Annual Company trip and Party | 1,700 | 1,700 | 1,700 |
Annual Wage Supplement (13th Month)** | 2,300 | 700 | 1,000 |
Equipment Expense (Macbook M1 air 16gb + Monitor) | 2,000 | 2,000 | 2,000 |
Annual Medical Checkup Cost | 180 | 180 | 180 |
Annual Medical Checkup Cost | 58 | 58 | 58 |
Annual Optional Welfare*** | 768 | 768 | 768 |
Annual Cost Subtotal | 10,606 | 9,006 | 9,306 |
*min $300/position of the co-working space in district 1,2,3,4.
**The 13th month equals 1 month of gross salary
***In the Vietnamese culture, having gifts, bonuses, and incentives is a big thing as it shows that the company cares about their employees
With the additional $28,918 from welfare and employee benefit.
Overall
Your offshore tech team of 3 people will cost $88,198 per year ($7350 monthly) to set up and run. The number might not seem impressive at first glance, but they are:
- 40% cheaper** than hiring local developers in Singapore.
- 15% cheaper** than hiring an onsite developer
- Better quality control than outsourcing
Turing Alley
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W: (+1) 818 408 6969