Key Considerations to Choose the Right Location For Setting Up an ODC

Setting up an ODC in India is a crucial yet difficult decision. It needs proper goals, an understanding of business requirements, and a solid reason for expansion. 

The biggest mistake companies make is to choose a location without proper research. 

That’s why we bring you this blog to make the decision a lot easier and organized.

In this blog, we’ll cover:

• • Understanding Your Business Requirements Before Setting Up ODC in India
  • Factors to Consider while Choosing the Location for Setting Up an ODC
  • Top Locations in India for Setting Up an ODC
  • Choosing the Right Location for Setting Up ODC in India with Remunance

By the end of this guide, you’ll have all the checkpoints required to make an informed and well-thought-out decision. Let’s start without delay. Shall we?    

Understanding Your Business Requirements Before Setting Up ODC in India

When you’re setting up an ODC, start by getting the basics clear. Focus on the reason and goals of setting up ODC in India.

Reason and Expected Results

Define the core reason for setting up ODC in India. It can be anything like cost savings, better talent, faster releases, or long-term innovation. Remember, your core reason decides how the entire setup will run.

Primary Objectives

If your main focus is on savings, expect 40–60% lower costs compared to onshore teams. Additionally, identify the niche skills you need for your business.

India’s deep pool in AI, cloud, and cybersecurity makes setting up an offshore development center in India a strong bet.

Building a team in India gives access to faster task delivery. Why? Indian employees are well capable of working with overlapping time zones.

Project Scope

Be specific about what the ODC will own, like dev, testing, analytics, or IT support. Secondly, map the complexity, tech stack, and deliverables to plan the right team size and skill mix.

Engagement Model

Choose the setup style that fits your risk and control levels. Use BOT if you want a smooth handover to complete control later.

Go for a subsidiary if you want full ownership. Alternatively, pick a managed team or an employer of record for faster, low-risk execution.

So, even before choosing the ODC location, you need to define your business requirements properly for the setup.      

Factors to Consider while Choosing the Location for Setting Up an ODC

When you’re setting up an ODC, the location should be on your plans’ priority list. 

And if you’re setting up ODC in India, these are the things you genuinely want to look at.

Talent Availability:

Check whether the city has abundant talent with the niche skills you need. Because there’s no point in setting up an ODC somewhere and then scrambling for the right skills.

Language and Communication:

India’s talent pool is usually strong in English. However, if you’re planning to choose an ODC location in Tier 3 or Tier 4 cities, it’s always better to double-check.

Cultural Fit:

India is a diverse country, and every city works differently. So, pick a place where the work environment or team’s vibe won’t clash with your business goals.

Retention Rates:

Check the employee turnover rates of the city you’re choosing. High churn means constant training, which is a slow and costly process. Look for cities where people stick around longer.

Cost of Operations:

Compare salaries, office rent, and basic utilities of your target location. Staying within budget is good, but not if it compromises quality. 

Get an idea of setting up an ODC India yourself with our EOR cost calculator. 

Government Incentives:

Some regions offer tax breaks, corporate tax incentives, tax breaks for foreign companies, and much more. You just have to keep yourself updated and aware while setting up an offshore development center in India.

Infrastructure:

Check for fast internet, steady power, and decent office spaces. You don’t want glitches when your team has essential deliverables.

Scalability:

Pick a location where you can hire more people with minimal effort. A flexible workforce saves hours of hassles in the long run.

Legal Compliance:

Verify every labor law, tax code, and data rules from your end before setting up an ODC in India. It will save you from future financial and reputational penalties.

IP and Security:

Make sure the region takes data protection seriously. Your product shouldn’t be vulnerable at any point in time.

Stability:

You don’t want political or economic instability coming in the way of your business. Choose a location where your business doesn’t have to face any regional instability.

As we’ve covered the checklists, let’s move on to our next section. 

Here, we’ll discuss the most approachable locations for setting up an ODC in India.

Top Locations in India for setting up an ODC

Let’s see the regional categories in India and what works best and worst in these cities.

Tier 1 Cities

If you want speed, top-notch facilities, and niche expertise, Tier 1 cities in India should be your go-to. You get access to huge talent pools in AI, ML, cloud, and a lot more.

The tech ecosystem in these cities is solid and advanced. The infrastructure is polished. Scaling teams is flexible, and global connectivity is solid.

Everything sounds nice. Too good to be true? No, there’s a negative side as well. Costs are always on the higher end in these metro cities. Salaries and office rentals aren’t cheap either.

Attrition is high because of high competition and abundant options. Commutes are long and complex.

Still, if your priority while setting up an ODC is quick access to experienced talent and ready infrastructure, Tier 1 cities are the safest bet. 

Cities like Bangalore, Hyderabad, Delhi NCR, Mumbai, Chennai, and Pune are your go-tos for setting up offshore development centers in India.

Tier 2 Cities

Tier 2 cities give you that sweet middle ground. The operational and hiring costs drop by 25–40%. Attrition stays low, plus there’s a lot of chance for growing talent.

Governments in these regions are highly supportive as they seek economic booms in their cities as well. Teams enjoy a healthier work-life balance, as half of their time isn’t wasted on commuting and other regional complexities.

But yes, you’ll need to invest in training, since many candidates don’t have big-enterprise experience. Vendor networks aren’t as solid as Tier 1. And office spaces aren’t always ready-to-move.

If your plan is to set up an ODC in India with long-term stability and a strong internal culture, Tier 2 cities are the perfect choice. 

Cities like Jaipur, Lucknow, Kochi, Indore, Coimbatore, and Surat work great.

Tier 3 Cities

Tier 3 cities offer surprisingly strong advantages, such as very low costs and loyal talent from regional engineering colleges. 

You get people who have the urge to build a reputation in one place and who are used to stability rather than hopping around.

But infrastructure is basic. Ecosystems are still in the early stages, and scaling quickly can be tough. Cities like Mysuru, Bhopal, and Ranchi fall in this bracket.

Tier 4 Cities

Tier 4 is the choice for early movers. Costs are low beyond imagination. Loyalty and retention are at their peak here. You also get access to long-term government support.

But remember, you’ll be building everything (talent, networks, infrastructure) from scratch here. Places like Palakkad or Dibrugarh fit in this category.

Tier 3 and Tier 4 work best if you have strong internal training or a remote-first setup.

Choose the Right Location for Setting Up ODC in India with Remunance

Choosing the right ODC location in India is much more than picking a city on the map. It’s about finding a place where all your business requirements align.

How to get there? The short and simple answer is Remunance.

If you’re setting up an ODC, you probably care about three things, which are talent, speed, and legal complexities. Fair enough. 

Still wondering why Remunance? With Remunance, you get all three. 

Our team of experts helps you hire the right people fast, manage compliance, and keep payroll easy and clean.

Are you planning on setting up an ODC in India for the first time? Or already exploring cities like Pune, Hyderabad, or Goa? Each location has its own vibe. 

Pune gives you strong tech talent. Hyderabad offers scale. Goa gives you peaceful operations. And because Remunance has offices across 8 major cities, you don’t have to wonder what works where.

Plus, we aren’t just another EOR vendor. We’ve built teams for 150+ clients across 31 countries. We respond fast. We deliver on time. And our tech keeps everything transparent.

If you’re serious about setting up an offshore development center in India, you deserve a partner that knows the market inside and out.

That’s what Remunance does best: we help you grow faster and grow right.

Conclusion

So, choosing the right ODC location in India comes with multiple factors. 

Some of them include talent availability, cost-effectiveness, operational speed, etc.

To check all these factors, you need a local expert like Remunance who understands them in detail. 

Some locations give you speed. Some give you stability. Some give you cost advantages. But only one will align with all your business requirements.

A partner like Remunance understands how India’s talent markets, cities, and compliance systems work. 

So, our team makes the entire setup easier. From scouting cities to building teams, you get a smoother start and a safer scale-up.

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