5 Reasons to Outsource HR as a Start-Up or SME 

In collaboration with David Hudson, The HR Dept: The Outsourced HR Company

Running a small business comes with it’s fair share of challenges and managing HR can often be a complex and time-consuming task. Many small business owners find themselves juggling multiple roles, leaving them with limited resources and expertise to effectively handle HR functions. Outsourced HR can provide massive cost savings for startups and small businesses whilst providing access to professional, qualified and experienced HR advisors. Outsourced HR can also give you the same services you would typically receive from an internal HR team, but at a fraction of the cost. 

We’ve put together the top 5 reasons to outsource your HR as a startup or small business: 

1. Cost Effective

One of the primary advantages of outsourcing HR is the cost savings it offers to small businesses. Employing a dedicated HR team or professional in-house HR manager can be expensive, especially when considering salaries, benefits, training, and infrastructure costs. 

By outsourcing HR functions, small businesses can access specialised HR services at a fraction of the cost, often tailored to their specific needs. This allows them to allocate their financial resources more efficiently and invest in other critical areas of their business growth.

2. Help handling difficult conversations 

As a manager there may be difficult conversations that need to take place, often found even harder in a small working environment. If you have to discuss misconduct,  poor performance or absence it can sometimes end in conflict.  An outsourced HR person can guide you through the process and advise on putting in place the best policies and practices to prevent escalation. 

3. Advice on hiring the right people

Recruitment is expensive, time consuming and if you hire the wrong person, it can cause delays and frustration. An outsourced HR team can manage everything from recruitment, job descriptions, advertising, CV reviewing and more. If you’re hiring your first employees to begin your growth journey, you need to recruit hires that grow simultaneously with your business.

An outsourced HR service can even help you to form a view of the culture of your company, and understand what you’d like your business to say about you. Shaping your recruitment process is fundamental to shaping the culture of the business to ensure you’re finding the right people.

4. Support with strategy and Growth 

Small businesses often experience fluctuations in their HR needs, especially during periods of growth or seasonal variations. Outsourcing HR provides the flexibility to scale HR services up or down based on the business’s evolving requirements. Whether it’s recruiting new employees, managing benefits enrolment, or handling terminations, an outsourced HR provider can adapt to changing circumstances quickly. This scalability allows small businesses to focus on their core competencies while ensuring that HR functions align with their business goals.

5. Employee training & up-skilling 

Keeping your employee’s skills relevant and up to date can be time consuming. Not all small businesses have the in-house experience to ensure their team has the best training and development programmes in place. Many outsourced HR support offers training, coaching and mentoring for your team and will help put a People Strategy in place. This will  keep your team engaged in the business, which is one of the top ways of retaining your talent,  ultimately keeping recruitment costs down in the long-run. 

Navigating employment law is a specialist area that requires specialist skills.  By outsourcing your HR, you get the benefit of a qualified and experienced HR expert without the expense.  

HomeWork’s Business Club can help with getting the right outsourced HR support for your business. We have collaborated with The HR Dept to provide members with a 30 minute free consultation with David Hudson.