How to Find a Competent Developer?

My company has a long history with a small software development firm offshore (.net desktop app), but their quality and ability to deliver on time is deteriorating.  I need to find a new developer and could really use some advice on where to get started with this search.  Where can I look for the best quality versus cost?  All suggestions would be much appreciated!
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If you post a project on a site like oDesk, you will get 50 applicants. They will all claim they are the best.

These sites work well, but ONLY if you do your part in the interview process. Also, be a project manager. Do not just draw up a scope of work document, hire someone and expect they are doing it the way YOU want them to do it.

My rule is, don't ever hire out for something you don't know how to do yourself. (Or at least have good knowledge of what it takes)

You definitely want to set up code review periods and milestones.

I've worked with excellent programmers and also some very poor programmers.

You really just have to find the right people. I've managed to create a great team of programmers (both local and outsourced) over the years, but it was through a lot of interviewing, trial and error.

If your area has a local .NET user group, I would recommend going through them as well. This is where I found my first two .NET developers and I still use them to this day. In my opinion, the local talent is your best bet. (This is just MY opinion). You may even be able to hire a local developer who himself/herself can outsource some of the work. In this case you get face-time with a real developer, and let him/her manage their team.

One more thing ... for long term it may be best to go through an IT staffing company. They will for sure find you the right talent.

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dev775Author Commented:
Thank you for the excellent suggestions.  I am looking in to the user groups and doing as much networking as possible in the development community.  You response was most helpful!
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