Jan 5, 2023 Legal Service — Eric Giguere

How Small Businesses Can

Small businesses face a variety of obstacles to their growth. From changing market conditions to the increasingly digital marketplace, the average small business owner can be forgiven for feeling overwhelmed. A rarely discussed obstacle is the quality of talent that small businesses hire.

In 2018, 56% of small-business owners reported difficulty hiring employees. The problems ranged from a lack of resources to a lack of necessary skills in the talent pool. Small businesses are increasingly looking to international markets for qualified employees in an increasingly global market.

In such situations, using the services of an Employer of Record (EOR) can prove extremely beneficial. Here are 4 ways in which EORs are powering SMB growth.


The premise of an EOR service is simple. The SMB can contract an EOR service and outsource its global payroll management and HR system management to avoid hiring foreign employees. This results in a flexible workforce arrangement that allows SMBs to access top-tier talent while avoiding the expense of setting up an international network.

EORs are referred to by various names, such as a Global Employment Organization (GEO) or global/ international PEOs. SMBs can avoid the legal headaches associated with an international structure by using these companies. It is often impossible and not sustainable for small businesses to set up an overseas entity.

Compliance requirements vary depending on the location. Setting up 2 entities in France to hire 1 person for the sole purpose is not a wise business move, especially if one talented employee is located in France.

SMBs have a temporary solution: they hire temporary workers. This solution doesn't guarantee a dedicated workforce. It is better to contact an international PEO for employees and avoid building a mercenary workforce.

Compliance with legal requirements

Payroll regulations and benefits regulations differ greatly depending on the jurisdiction.

An EOR helps companies sidestep these problematic regulations as they're wholly aware of local laws and can help you figure out what payroll laws are and how you can structure your pay offers.

Local laws are also important in employee dispute handling. SMBs will not have the resources or time to fully research the laws governing employment and payroll and get a satisfactory result. It is best to use the services of an EOR local to assist you in such cases.

Easy Scaling

Many small business owners are looking to scale up quickly and grow to attract investors. The best way to make sure this happens is by hiring top-tier workers. It is expensive and time-consuming to set up international entities.

Small businesses and startups can't afford to spend money on entities that create bloat. An EOR's services are crucial in such cases. EORs can help startups hire globally while retaining a local physical presence through the leasing of employee services.

The result is that even hyper growth startups and businesses can engineer flexibility and agility into their business models without compromising on hiring quality or increasing costs.


Agile organizations are able to understand and cater to their customers' needs. SMBs will have customers around the world these days. This is why it is important to hire talent worldwide. Employers who are local to a customer's location will be more able understand their preferences than employees who work overseas.

A global workforce also builds business resilience thanks to a variety of ideas being thrown into the mix. Because the world is constantly changing, homogenous organizations are struggling to survive. In these times, having a diverse workforce can be a great way to generate new ideas and stay ahead of the curve.

EORs make global workforce building cost-effective and easy. As a result, even SMBs can access talented individuals irrespective of location and build unique business models. EORs eliminate the need to physically present employees and make it simple to establish remote workforces.

Global Solution

EORs, GEOs, and Global PEOs are a great way for small businesses to hire the talent they need to grow quickly. Historically, large enterprises were the only ones that had access to global markets. Now, thanks to changing business conditions, SMBs too can compete on a global scale.

Image by Depositphotos

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