Outsourcing HR: Big Savings for Small Businesses

by Charles Ebert
Employment Market, Hiring Talent - 3 years ago

Editor’s Note: This is a guest post by Charles Ebert – motivational speaker and Human Resources Consultant –  His opinions are his own.

When starting a new business, at times finances may be inadequate. Therefore, cost cutting measures like outsourcing become inevitable.

Employees are crucial in any company. Even so, finding a person who can substitute for several individuals, constitutes to huge savings while also helping your business grow faster.

This post will delve into the benefits of outsourcing HR and why it can potentially contribute to huge saving for small businesses.

What’s an HR Department and do you need one?

Most established companies have HR departments which are totally responsible for finding, recruiting and hiring new staff. They always browse the job market in search of the best candidates for open positions in the company.

When talking about new companies, the situation is different. Mostly, they do not need dozens of new employees. Thus, the HR function is better outsourced when needed.

Fortunately, today, the HR industry has some perks. According to the latest statistics, more than 85% of companies, even the ones that have their own HR departments, still outsource certain HR services. It means, that they do not look for the candidates. They rather cooperate with an outsourced company or single HR representatives who are working on finding people for them.

The Benefits of Outsourced HR Services

Outsourcing has a huge popularity today owing to many benefits including:

  • You do not need to pay full time salaries every month – When you engage outsourced experts, you pay only for the project. Thus, there is no necessity to pay them every month, and you can save money for some other more important things for your business.
  • You can choose a specialist for a certain piece of business – HR managers have different specializations. Some of them are perfect in finding marketing specialists, while others can easily find you the best candidate in front-end development. If you are looking for employees in different industries, it is better to hire outsource specialists for each of the open positions.
  • You do not need to think about workplace – When you outsource services, you do not need to provide workspace. As a startup, you probably do not have enough space for hiring multiple employees and want to save money on renting a new bigger office. This helps you reduce costs.

Outsourcing companies vs individuals?


As a rule, when you outsource to an individual HR specialist, you may not sign any long term contracts. Even though you may come to some agreement, the responsibility of the HR expert is rather low. Thus, you are the one at risk. Of course, it is always better to hire someone who comes highly recommended as a professional who always sticks to the agreement and never cheats the company.

Still, in some cases, individuals are even better. They are always on the look to guard their reputation. Thus, they will do everything possible to successfully fill your vacancy, and in case they don’t have any good candidates, they can recommend you some other HR professional who is perfect in this field.


Companies are the best choice when hiring a team or some rare specialists. They have a huge number of candidates to choose from and can reach any candidate that you want.

Besides, when starting to cooperate with the company, you always sign a contract. This brings an element of legality. In cases where the company cannot fulfill your agreements, you will get your money back.

Also, you get to benefit from professional expertise, recruitment assistance, payroll management, benefits administration, time management, labor management, help with compensation, etc.

Where to Outsource HR Services

When looking for where to outsource, use recommendations from friends and partners, but also keep your options open. You can also use comprehensive LinkedIn services.

For the past few years, LinkedIn has become one of the best professional networks where you can easily find a huge number of candidates for different positions. You will find the resumes from professionals from virtually all over the world.

Besides, LinkedIn also has a huge number of HR manager profiles, outsourcing companies and those who provide their services individually. To find the best one, check the basic information on the profiles and the feedbacks they have. Assess what they are offering and choose according to your preferences.

If you have decided to outsource your HR and recruitment services, you need to get ready to spend some time to find a specialist that will successfully represent your company and will get to understand what exactly you want.

You will definitely need to hold several interviews with different companies and individuals. Never hire those who are just good. As a startup, you have no time and money on average results, you should always get the best one. Of course, you need to pay more for high-quality services, but you will see later, that investment was perfect for your business development.

In this brief guide, we covered the main aspects that you need to know when considering HR outsourcing.

Do remember that the people you hire have an impact on your business. If you can find those who will stand for your values, who support you at all stages of the business development, and who will not leave you only because something goes wrong, sooner or later, you will get the results that you have always dreamt about. So do not hesitate to ask for help and start to cooperate with HR managers who will assist you in finding the dream team for your company!