Most buyers compare vendors. The more useful comparison is between sourcing models, because the model sets the ceiling on what any vendor inside it can do for you. There are four in common use, and they fail in different ways.
The four models
Global systems integrators and Big-4 practices. You buy a statement of work, a partner, and a delivery methodology. Day rates typically run two to four times the European nearshore band. You are paying for indemnity, procurement familiarity and the ability to point at a large balance sheet if the programme fails.
Boutique AI consultancies. Fixed-scope projects, senior-weighted teams, strong opinions about architecture. Rates sit between integrators and augmentation. They are good at defining the problem and poor at staying once it is defined.
Talent marketplaces. You get a vetted individual within days at close to the contractor’s own rate. There is no team, no shared context, and no one accountable for the outcome above the individual.
Staff augmentation and nearshore teams. Engineers join your team, your standups and your repo. You keep architectural control. The vendor carries recruitment, employment, compliance and bench risk.
Where each one actually wins
| Your constraint | The model that fits |
|---|---|
| You don’t yet know what to build | Boutique consultancy |
| You know what to build, and lack hands | Staff augmentation |
| One specialist, one narrow gap, this week | Marketplace |
| Board-level risk transfer and procurement cover | Systems integrator |
| Regulated data that cannot leave the EU | EU-based augmentation or in-house |
Read that table as a diagnostic rather than a ranking. The most expensive mistakes we see are buyers who use a consultancy to do augmentation work, and buyers who use augmentation to do discovery.
The four questions that decide it
Ask these before you shortlist anyone:
- Who owns the architecture in twelve months? If the answer is your team, augmentation is the only model that builds that ownership as it goes. Fixed-scope delivery concentrates the knowledge in people who leave.
- How specified is the work? Well-specified work travels well and can be bought cheaply. Ambiguous work needs someone in the room who can push back, which is a consultancy strength and a marketplace weakness.
- What happens if you stop paying next month? Augmentation and marketplace engagements stop cleanly. Fixed-scope contracts carry termination terms that are usually worse than buyers remember.
- Is the data regulated? If you process personal data under GDPR, engineers inside the EU need no transfer mechanism. Anything else means Standard Contractual Clauses, a transfer impact assessment, and an owner for both.
The cost comparison people skip
Day rate is the visible number and rarely the decisive one. The real comparison has four lines:
- The rate itself. See the daily rate benchmark for the current European bands by role and market.
- Management overhead. Every engineer you add consumes senior time. Consultancies absorb some of it and charge for the privilege. Marketplaces absorb none.
- Ramp time. Weeks of partial productivity before an engineer contributes. Longer for anyone joining a fixed-scope team that will hand over later.
- Rework. The cost of the model getting the problem wrong, which correlates with how far the decision-maker sits from the code.
A boutique consultancy at twice the day rate can still be cheaper on a three-month discovery engagement. An augmentation team at half the rate can be more expensive if you have nobody senior to direct it.
Where staff augmentation is the wrong answer
We sell augmentation, so treat this section as the honest part.
- You have no technical leadership. Augmented engineers execute against direction. Without direction they will build something reasonable that solves the wrong problem.
- The work is a genuine one-off with a hard end date and no follow-on. Fixed scope prices that risk better than time and materials.
- You need someone to sign for the outcome. Augmentation vendors supply capacity, not indemnity.
- The requirement is one person for three weeks. Marketplace fees are lower and the setup is faster.
What to do next
Write down your answers to the four questions above before you contact anyone. Buyers who arrive with those answers get a shortlist of two. Buyers who arrive asking “what do you charge” get a proposal from every model at once and no way to compare them.
If augmentation is where you land, the how it works page covers the engagement mechanics, and nearshore vs offshore covers the geography question that usually follows.