"How much does keeping one engineer cost per year?" A COO at a 30-person company showed me his math: NT$70k/mo × 14 months = NT$980k, "call it a million." Three months later that engineer quit, and he discovered the real bill was far higher — the vacancy, the broken handover, the re-hire burned another half year. In-house is not bad; most owners just count only the visible 60%.
Myths Busted
- Myth 1: Hiring is cheaper than outsourcing. Truth: add hiring, insurance, equipment, management time, and turnover, and a senior engineer's true annual cost is often 1.5–1.8x salary.
- Myth 2: Our own person means more control. Truth: a single engineer is a single point of failure; control hits zero when they are sick, on leave, or quit.
- Myth 3: Outsourcing loses knowledge. Truth: it depends on contract and deliverables. Outsourcing that requires ADRs/handover docs retains knowledge better than it all being in one head.
Core Framework: True Annual Cost Formula
True annual cost = total annual pay (incl. bonus) × (1 + benefits factor ~0.18) + amortized hiring + equipment & software + management time cost + turnover-risk reserve
Fill in every line before comparing against an outsourcing retainer.
Three Scenarios
| Company type | In-house true annual cost | Outsourcing (retainer) | More cost-effective |
|---|---|---|---|
| Early startup (unstable demand) | ~NT$1.5–1.8M / engineer | Retainer NT$30–60k/mo, scalable | Outsourcing |
| 50-person growth co. (steady, mid) | ~NT$1.6–2.0M / engineer | Retainer NT$35–80k + projects | Often hybrid |
| 200-person co. (high, real-time) | Multiple engineers, amortized mgmt | Hard to support core in real time | In-house |
Hidden Cost Checklist
- Hiring: job boards, interview hours, probation risk — amortized ~10–20% of salary.
- Insurance & benefits: ~18%+ of salary.
- Equipment & software: laptop, IDE, cloud, subscriptions — ~NT$30–80k/yr.
- Management time: mentoring, meetings, code review — hours/week of hidden cost.
- Turnover: vacancy + handover gap + re-hire — often half a year's salary per event.
- Opportunity cost: idle months (slow season) still cost full salary.
Vendor KPI Scorecard
- ☐ Written quotes and transparent hours?
- ☐ Delivers ADRs/tech docs, not just code?
- ☐ Clear SLA and response times?
- ☐ Code and account ownership belong to the client?
- ☐ Version control and CI/CD?
- ☐ Honest about not-for-outsourcing cases?
- ☐ Exit and handover clauses?
- ☐ Verifiable past work?
ScriptWalker's Models + When We Are NOT a Fit
ScriptWalker offers Project, Retainer (maintenance from NT$15,000/mo), and Advisory, switchable by demand density. Not a fit for us: a core-system team needing 8-hour daily real-time standby, highly confidential in-house algorithms that cannot leave, or roles needing long-term on-site culture embedding — those call for in-house.
Transition Playbook (from in-house anxiety to hybrid)
- Month 1: inventory systems, permissions, and doc gaps; build a central ledger of code and accounts.
- Months 2–3: move repetitive ops (deploy, backup, monitoring, small fixes) to a retainer; keep key decisions in-house.
- Day 90: review cost and response speed; decide what stays outsourced vs returns in-house.
Decision Checklist
- ☐ I computed true annual cost, not just salary
- ☐ I know if demand is stable or volatile
- ☐ I assessed single-point-of-failure risk
- ☐ I have a code/account ledger
- ☐ I require tech docs, not just code
- ☐ I compared the 3-year totals of in-house vs outsourcing
- ☐ I confirmed IP and exit clauses
- ☐ I considered a hybrid model
FAQ
At what size should I start hiring in-house engineers?
No magic number — the key is whether demand is steady enough to keep one person fully loaded. If needs ebb and flow, a full-timer means paying for idle slow-season capacity, where a retainer or hybrid wins; in-house pays off when core systems need daily real-time maintenance at steady, full load.
What is the biggest outsourcing risk, and how do I reduce it?
The biggest risk is knowledge and access not staying with you. Reduce it: require ADRs and tech docs, keep code and all account ownership, and write exit/handover clauses. Do these three and outsourcing retains knowledge better than relying on one employee.
How does a hybrid model split work?
A common split: core decisions and secrets in-house, repetitive ops outsourced. Deploy, backup, monitoring, and small fixes go to a retainer; product direction and sensitive logic stay internal.
Is switching vendors painful?
If you required docs and ownership upfront, handover is smooth; it only hurts when knowledge is locked with the vendor. That is why handover clauses must be negotiated at contract start.
Call to Action
Want to know if you should hire, outsource, or go hybrid? ScriptWalker offers a free 30-minute assessment to compute your true annual cost before you decide. Contact us:
- Email: [email protected]
- Phone: 0916-224-047
- LINE: @ufv9089p