Why the sticker price is rarely the real price?
On paper, offshoring looks simple. You are quoted a monthly rate per person, the cost looks significantly lower than hiring locally, and the decision appears straightforward. But many IT service providers and MSPs learn the hard way that the advertised price is only the beginning.
Traditional offshore providers often present an attractive headline number, yet over time that number quietly balloons. By the end of the year, the real cost can be far higher than expected.
One of the most common shocks is the 13th-month payment, typically charged around Christmas. Just as many service providers are managing holiday slowdowns and year-end cash flow pressure, an unexpected extra month of salary appears. It is rarely highlighted clearly during the sales process, but it is very real when the invoice lands.
Most traditional offshore providers bill in a foreign currency. That means you are not just buying talent; you are also buying exposure to the foreign exchange rollercoaster. A favourable rate one month can turn into a nasty surprise the next, with no control on your side. On top of this, there are international transfer fees, FX margins, and bank charges that quietly erode your margins month after month.
It is not uncommon to see line items for Christmas parties, team events, social clubs, and cultural activities, sometimes mandatory, sometimes “strongly encouraged”. While team culture is important, the frustration comes when you are paying for events you did not plan, did not budget for, and may not even align with your own business values.
Health insurance is another area where costs can spiral. Charges often vary based on the number of dependants a team member has, meaning your monthly invoice can change without warning. Add to that compulsory life insurance premiums, and suddenly your “fixed” cost is anything but fixed.
Local government levies, statutory contributions, and compliance charges are frequently passed straight through to the customer. These can change annually or even mid-year, adding yet another layer of unpredictability to your offshore spend.
Many providers add allowances for leave provisioning, accruals, or vaguely described “allowances”. These often appear as generic line items with little explanation, making it difficult to forecast costs or reconcile invoices confidently. Over time, these small amounts add up to a meaningful drag on profitability.
Some offshore providers charge recruitment or placement fees on top of monthly rates. These can be framed as “one-off” costs but often apply per role, per hire. If you scale your team over time, these fees compound quickly and significantly increase your total cost of ownership.
Attrition is a reality in any labour market, but many traditional providers monetise it. When a team member leaves, customers may be charged replacement fees, rehiring costs, or temporary cover premiums. In some cases, you pay twice, once for the outgoing team member and again for the replacement, despite the disruption being outside your control.
Beyond the base cost, additional charges often appear for team leads, account managers, HR support, payroll administration, or “operational oversight”. While these roles may be necessary, the issue is transparency. These costs are frequently separated from the headline rate and introduced later as unavoidable add-ons.
Many contracts include automatic annual increases tied to inflation, wage indices, or local labour market benchmarks. These increases are often mandatory and non-negotiable, regardless of performance or market conditions. Over a multi-year agreement, indexation clauses can materially inflate your offshore costs beyond what was originally forecasted.
All of this is usually on top of a seat lease fee covering desks, offices, internet, and facilities. What looked like a clean per-person cost becomes a complex invoice filled with exceptions, add-ons, and fine print.
Offshoring works best when it delivers predictability, control, and trust. If you are constantly reconciling invoices, questioning unexpected charges, or explaining cost overruns to your finance team, the model is broken.
A true offshore partnership should remove complexity, not add to it.
If you are exploring offshoring or rethinking an existing provider, it is worth asking a simple question – Is the price I am being quoted really the price I will pay?
With Dijital Team, the answer is yes.
At Dijital Team, we believe offshoring should make your business simpler, not more complex. That is why we operate on a single fixed cost per role, with no extra charges - ever.
No recruitment or placement fees
No replacement or attrition charges
No management or admin overhead add-ons
No annual indexation surprises
No foreign currency risk
No seat lease fees
No mystery line items
You know exactly what each role costs every month, all year round.
That transparency allows you to forecast confidently, protect your margins, and focus on growing your business rather than trying to work out the various line items on invoices.
Find out what your offshore team really costs, and what it should. Lets Talk!