Techreviewer.co is an analytics hub sharing top software companies’ rankings and reviews. At the end of 2021, our team has made quick research on the software development companies about the market state, results of 2021, and their plans for 2022. The overall number of companies that participated in the research is 100+. Participants’ Overview Companies Size Most of the companies are either (32.86%) or (35.71%) agencies with up to 100 employees. small medium Companies Headquarters **38.6%**of all companies have just one office. The companies are headquartered in different countries including the following ones: of companies have business development offices in other countries mainly in the , and development centers in . 62.4% USA, UK, Canada India, Ukraine, Belarus, Russia, Poland Specialization Only **11.43%**of the companies don’t define any specialization in their activities. **35.71%**define their specialization in everything. **40%**of the respondents define their specialization in the field of technologies. Much fewer companies define their specialization based only on domains or business types they work with (2.86% and 8.57% correspondingly).  About 16% of companies use a mix of parameters to define their specialization. Core Tech Stack As mentioned above, many companies define their specialization based on the technologies they use. Here is the overview of the core tech stack of the respondents. Services Provided Most of the companies provide full-cycle development services covering basic needs and requirements. The most popular services provided are . web development (83%), custom software development (80%), mobile development (73%), design (67%), and QA (64%) The trending services in the fields of AI/ML (Development, Consulting) and Cloud (Services, Migration, Consulting) are provided by less than 10% of the companies. Solutions Developed The most popular types of solutions make are IT companies eCommerce (70%), SaaS (67%), Business and Enterprise software (64/63%), and Startups MVPs (61%). English Knowledge Most of the IT companies have their development centers in India, Ukraine, Belarus, Russia, and Poland. The communication with the clients is done in English. Consequently, the level of English knowledge is becoming crucial for delivering the projects. Usually, the level of English of managers who are the key contacts to the clients is much higher than that of the developers. is the most common level of managers while C1 level (40%) 57% of engineers have B1-B2 levels. Certifications Only of the participants mentioned that they The most common ones are the following: 40% have tech certifications. Other certifications mentioned: Web Analytics Certifications Magento Certifications Cisco Certifications Aruba Certifications Cybersecurity Certifications (CCSP, CEH, LTP, etc) Healthcare Certifications (CHP, CHPSE, CPHIMS, CPC, etc) Work with Partners and Subcontractors Almost 60% of the companies work as subcontractors of other IT companies. 20 of the companies address freelancers if they need any additional help with the projects. ‍ Preferable Cooperation Model Dedicated team and Time and Materials Models are the most preferable ones for IT companies. Only 16.4% of the companies prefer working on the Fixed Price model. Sales & Marketing Overview Hourly Rates Currently, most of the IT companies charge from 30 to 60$/hour - **15.7%**charge less - from 10 to 30 $/hour. 58.6%. Most small and mid-sized IT companies charge up to 60$/h. Only **18%**of such companies charge more than 60$/h. IT companies sized more than 100 employees have higher development rates - 46% of companies charge more than 60$/h (vs 18% of small and mid-sized companies). Hourly Rates of Companies Sized 10-100 Hourly Rates of Companies Sized 100+ Minimum Project Size Most IT companies are ready to start working on projects of 10-20K USD size. However, the companies sized 100+ employees are more inclined to 20-30K USD sized projects. Minimum Project Size of Companies Sized 10-100 Minimum Project Size of Companies Sized 100+ LTV Even though a starting project check of the projects is 20-30K USD, the of most projects is from 30K to 100K USD which is at least . LTV twice as bigger as the initial check Lead generation channels in 2021 The most popular lead and project generation channels in 2021 were Network, Clients’ references, Direct Sales, and reputation management websites. Why Clients Choose 2021 Achievements & Changes Company Size The high demand for software development services resulted in companies' growth in 2021. 55.7% of the companies have faced the size change in 10-30% and 21.7% - up to 50%. 4.3% of the companies managed to almost double their size. Only about 8% of the companies either remained the same in size or decreased. Bigger companies managed to grow more - up to 50% 10-30% Growth Rate Companies These are mostly companies of 10-49 and 50-99 sizes. 30-50% Growth Rate Companies 50-100% Growth Rate Companies Rates Сhange in 2021 2021 was a year of very high demand for IT services that resulted in at least 10-25% rate growth. Only 20% of the companies remained the rates the same as in 2020. Rates Change of Companies Sized 10-100 Rates change of Companies Sized 100+ Plans for 2022 New Markets Entrances Most of the companies plan to expand their services to the EU, the UK, the USA, and Canada regions. 33% of all companies plan to enter Scandinavian markets as well as Asian ones (50% of companies sized 100+ employees named this region as a priority for 2022). New markets of Companies Sized 10-100 New markets of Companies Sized 100+ Hourly Rates Growth Plans for 2022 Even though IT companies increased their rates in 2021, 70% of companies plan to continue rates increase in 2022. However, these are mostly small and mid-sized companies. 41% of the 100+ employees companies plan to remain the rates the same vs 24% of 10-100 sized companies. The most expected increase will be in the range of 10-25%. Hourly Rates Growth Plan of Companies Sized 10-100 Rates Growth Plan of Companies Sized 100+ Tech Stack Changes Most of the companies don’t plan to change or expand their tech stack - almost 46%. The most popular “candidates” are Python (10%), GoLand (8.57%) and Vue.js (8.57%) Tech Stack Changes Plans of Companies Sized 10-100 Tech stack Changes Plans of Companies Sized 100+ Key Marketing Challenges Based on the research, IT companies foresee the following sales and marketing challenges in 2022. In Conclusion In conclusion, we won’t make any general references to the state of the IT market in 2022 or make any predictions about the future. There are many reliable pieces of research you can find from Accelerance, Statista, etc. We would like to gather several interesting insights from our research that can be discussed, considered, and used in your business. Top insights to think about: Most IT companies have started to define their specialization, but only 10% of the companies specialize in the types of solutions they make or business domains they work with. What is your specialization? How is your team different from the competitors? Most of the companies provide basic IT services with the most popular technologies on the market and only a few of them are planning either to add new emerging services or technologies into their portfolio. Will your business benefit from adding emerging technology or product? There is a big gap in English knowledge between managers and engineers while the most preferable cooperation model is a dedicated team where the involvement of managers can be limited. What are you doing to improve your team's English level? LTV is usually at least twice as big as an initial closure amount. What’s the difference between your deal closure and LTV? Do you upsell well? Clients’ references and networks are the most popular way of getting new projects. However, new lead generation channels search is the biggest challenge for 2022. What new lead generation channels will you test in 2022? In 2022 companies will continue increasing rates. What will be your strategy here? Will clients demand additional services for paying more? Asian and Scandinavian markets are becoming a priority for big companies to enter in 2022. What’s your regional strategy? Are there any other insights you found valuable from this research? Need any additional information? Let us know via email and we will add these details into our future research. info@techreviewer.co Also Published here

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A Closer Look at the State of Software Development Companies in 2021 and Beyond

A Closer Look at the State of Software Development Companies in 2021 and Beyond

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