The Financial Benefits of Using an Employer of Record

Budgeting and financial planning are essential parts of business. Cost savings are the most predominant factor in financial planning. How much funds are needed, how much funds can be saved, how many deals you can close to cover the expenses, etc, are some of the parameters companies consider during budgeting. 

You can set up your business entity, or you can use an EOR for global hiring. If you use an EOR, you can avail of more financial benefits than the entity setting up process.  Let’s discuss how you can avail yourself of the employer of record benefits while getting the financial advantages of EOR for your global hiring.. 

Global companies expand with planning, strategy, and new hiring. The cost of hiring international employees has become challenging as multiple measures are associated with the process. Companies can manage hiring in two ways: either set up an entity, spend huge funds, and wait for the results, or go with the quality without compromising the monetary issues—using an Employer of Record (EOR) service. 

Employer of Record services provide the entire hiring process from start to beginning at a price. It is beneficial for any volume of business, small, middle, or large, and helps to expand across the border without setting up a business entity in the country. 

Therefore, business owners experience the financial benefits of EOR during their operations and utilize the platform to save precious time and valuable funds. 

Let’s know which ways you can avail yourself of cost savings EOR for your global hiring and payroll management.

Financial benefits of Employer of Record (EOR): Know how?

An EOR saves funds and time in multiple ways. Here is the list: 

Reduce the upfront expenses

The upfront cost of the entity setup is vast. There are multiple measures business owners need to cover within the budget, including finding, hiring, government taxes, payroll taxes, etc. If you use an Employer of Record, you can bypass many upfront costs such as registration fees, office rent in advance, fees for documentation, VAT registration, several government fees, and many more. 

You can use these funds in other operations, such as training your employees or marketing your product. EOR helps to reduce the upfront costs. This way, you can eliminate upfront cost challenges and bring financial benefits of EOR that help in the expansion of your business.

Eliminate the risk of non-compliance and avoid fines and penalties

Compliance is associated with local labor laws and local regulations for hiring purposes. The government of the country decides local labor laws. If you miss out on any clause during the hiring process, your organization may attract heavy penalties. And every country has separate employment laws, labor laws, etc. With an EOR, you do not need to check the government clauses because, on your behalf, the EOR platform will take care of all the legal formalities. 

Thus, with a cost savings EOR, you can avoid legal documentation and other tax-related issues.

How financial benefits of EOR reduce the administrative expenses

There are multiple administrative costs involved in global hiring, such as HR functions, a candidate’s medical exam, various government taxes, etc. If you use an EOR, you do not need to pay such unwanted charges as the service provider will comply with all the activities under a single platform and perform hiring onboarding on your behalf. Even payroll calculations can be costly because there will be benefits and other perks associated with employee payroll.

Instead, you can pay the EOR service provider, and they will assist you in managing your employees by reducing administrative expenses.

Technical charges are less with an EOR

Technical integration is needed to run an EOR. The AI-integrated platform provides accurate and faster results. Besides, there are multiple other benefits associated with it, such as international countries having different types of HR and payroll compliance. One centralized platform can access global countries’ talent pool from several industries. 

An EOR helps business owners to maintain data processes and data security in a well-structured manner. Data is a valuable asset for businesses, and Employer of Record supports business owners in storing, processing, and securing the data within the system. 

Global business expansion needs a faster process, either in recruiting or managing payroll. An EOR ensures that hiring is within the scheduled time while avoiding HR costs. For instance, EOR in Mexico, EOR in the Philippines, EOR in Bangladesh, or EOR in India performs the hiring, compliance, payroll management, and local tax calculations – everything quickly and efficiently.

With a local entity set up, there are expenses like license charges, maintenance charges, and other hidden expenses that interrupt your budget limit. However, an expert EOR platform like Global Squirrels helps you stick with your cost as the platform fixes all the charges before you make the payment. In any case, there will be no extra cost the platform can ask as it’s a cost-saving solution for your business.

Affordable entry into new markets

Global hiring needs entry to new countries. With an effective EOR, you do not need to set up a legal entity, operational expenses, or administrative setup. The affordable charges of Employer of Record help to be within the limit while entering into the new market to build an international team. International countries’ operations charges are much higher, and this affects the organization’s budget. 

However, with Global Squirrels, the entry of new countries will be smooth and cost-saving so that you can focus on business growth strategy.

Related Read: Employer of Record vs. Entity Setup

Combined your financial plan with Global Squirrels

You can hire from multiple countries with the help of Global Squirrels and experience the financial benefits of EOR. One of the leading Employer of Record platforms, Global Squirrels offers a comprehensive hiring and payroll management service under the most cost-effective package. The platform manages payroll, compliance, local labor laws, and regulations across the border.

Pay just $1.49/hour/employee/month and start your global hiring journey with us and experience the seamless and faster process.

If you want to know more, talk to us today!