New Horizons Global Partners Ltd. Blog Four ways to outsource staffing and boost your global expansion

A talented workforce is the most important asset a business can have. But is this always something that should be carried out within the business, or should you outsource staffing? Here we explain why it can be a good idea to outsource staffing, whether internationally or locally, and explain the best mechanisms for doing so.What are the risks of managing staffing entirely in-house?While your workforce is essential to your business's operations it is not your core business. This means that there are several disadvantages to sourcing and administering your staff in-house. These disadvantages include:You may not be completely familiar with all your employer compliance and tax obligations;You may not have the recruitment connections and networks to ensure you source the best staff for your business.These disadvantages compound when expanding internationally as you are unlikely to know the new compliance and business environment in a new country as well as in your base country.What are the benefits of outsourcing staffingWhen you outsource staffing, you engaging a trusted third party to take over your recruitment, payroll, tax and compliance obligations. In addition to mitigating the risks set out above, consider the other benefits when you outsource staffing:Co-ordination across all business locationsWhen you outsource staffing to trusted employment professionals, you can ensure that one approach to staffing and payroll administration is taken across your wider organization. When this is carried out internally, it is likely that there will be significant variation between different business locations. The benefit of one staffing partner across all business locations is especially clear for international businesses that may have legal entities across multiple countries;Better benefits for staffA specialist employment partner is often able to get better deals on employee benefits (such as health insurance and pension schemes), compared to regular companies. This is because, as their 'core business' is employment, 'economies of scale' apply to get better deals on benefits; CostSpecialist employment partners provide staffing and human resources services more cheaply than most firms would be able to do so themselves;SpeedAn outsourced staffing provider has the know-how and processes to quickly acquire and onboard new staff for your business. They can also respond quickly to any staffing issues as they arise.Are there any downsides when you outsource staffing?Businesses that outsource staffing services are part of an ongoing trend known as 'Business Process Outsourcing' or 'BPO'. That is, businesses outsourcing to third parties, processes which are not core business and might be more competently carried out by a third party for a better price.In most cases BPO and outsourcing employment responsibilities is a useful way for a business to ensure that it maintains its competitive advantage in its area of core business focus.There may be some cases where it makes sense to carry out all human resources tasks in-house, rather than outsourcing. This could occur, for example, with very large multi-nationals that have their own tailored approach to human resource management that they wish to apply.It is worth noting, however, that in most outsourcing situations (such as the Global PEO model discussed below), the client business still remains entirely in control of their staff on a day-to-day level. For example, a global PEO or staffing agency will only terminate or renew contracts of staff in close consultation with a client company.How to outsource staffing the right wayOnce you have decided that it makes sense to outsource staffing, what is the best tool for doing so? There are a range of outsourcing partners that you could choose that offer slightly different sets of solutions:Recruitment agenciesA recruitment agency seeks out talent for your company that you may not otherwise find through traditional hiring methods. However, crucially, recruitment agencies only perform one function - recruitment. They do not themselves hire the staff, nor do they provide ongoing human resources solutions;Staffing agenciesSometimes called a 'staffing company' or 'temp agency', these agencies specialize in temporarily lending workers to client companies. When this is carried out on a longer-term or project basis the company might be known as an 'employee leasing' company;Domestic Professional Employer Organizations (domestic PEOs).These companies, common in the United States, take on the administrative responsibilities of an employer, but share employment responsibilities with a client company as a 'co-employer';Global PEOsA Global PEO acts as the 'employer of record' for staff based throughout the world. A full-service global PEO provides recruitment, payroll, tax, and compliance functions on behalf of all its clients. Unlike a domestic PEO, a global PEO is not usually a 'co-employer' - the global PEO takes over all employer responsibilities and liabilities. Sometimes this suite of solutions is known as 'Global Employment Outsourcing' or 'GEO'.ConclusionWhether you are expanding locally or internationally, it is worth considering whether you should outsource staffing to a specialist third-party firm. This will save your business money and time, as well as reducing the risk of non-compliance with tax and employment laws. In many cases, the best option for outsourcing employment and human resources services is a global PEO. A global PEO can offer the full suite of staffing solutions for all your business locations.