When you are a growing business and you have plans of gearing forward and expand, you most likely have in mind the processes or procedures that needs to be done, from hiring staff and the possibility of establishing a new corporate entity.
But then, there are countries now especially those in the Latin America side that allows a company to expand from an international country and does not need to establish a new corporate entity. Employer of Record, or EOR, makes this possible, being it an organization that contracts with business expanding internationally and they take care of legal responsibilities of employing your employees and all formal employment tasks in the country you choose to have the business.
There are countries that have their own employment, payroll and work permit requirements for non-resident companies and these can be a burden when meeting such requirements, thus, Employer of Record come in handy as it helps you overcome the regulatory and cost hurdles if you decide to employ workers in the country of choice.
So in essence, when you expand internationally, you are actually the original employer and the Employer of Record functions as your intermediary and will work as the registered employer of the employee being hired locally but function is only limited to dealing with establishing the legal and regulatory requirements and have no say to the regular daily work operation.
In general your HR or administrative department is being handled by the EOR and according to your kind of business you can choose an EOR in the likes of International Professional Employer Organization PEO, Foreign Subsidiary as a Service (FSaaS), Administrative Services Organization (ASO), and the Business Process Outsourcing (BPO). All of these types of Employer of Record are good, but you have to choose which type there is can be most useful and beneficial to the kind of business that you have and are operating on as well as your business needs and preferences.
So then, you can generally see that with the use of Employer of Record, your company or business will have the best benefit in reference to getting the convenience of access to immigration compliance, no need for you to go for local incorporation, and it will be easier of running payroll in the host country, which all are positive benefits that will work pretty well for your goals.
True enough it is a challenge to be expanding, even if you have the resources, it can still be a daunting work, especially when you are considering international expansion, but then knowing that there is that Employer of Record that you can use to make it possible with ease, efficiency and that is cost-effective, then you will need to get a more detailed information to know what is the best option for you that will benefit entirely the business at all costs knowing it to be essential.