Successful business managers know that some tasks are best performed in-house while others can be outsourced with minimal effects on operations. For anyone seeking to enter the Guatemalan market for a limited-scale or short-term period, or who is already active there and wants to reduce their administrative burden, payroll outsourcing in Guatemala could be the ideal solution.
Over recent decades, Guatemala has experienced almost continuous growth in gross domestic product (GDP), which reached $76.7 billion (all figures in USD) in 2019. The country has seen a corresponding rise in prosperity among the population, with gross national income (GNI) hitting $8,870 that same year.
Guatemala occupies a strategic geographical position, dominating Mexico’s southern border and acting as a bridge between the three major economies in North America and the rest of Central America. The country also benefits from having high-volume ports serving both the Atlantic and Pacific Oceans, which contribute to the country being a major trade hup for Central America, accounting for 30% of goods that pass through the sub-region.
In terms of trade, Guatemala’s biggest exports include oil and gas, bananas, coffee, sugar, and non-precious metals. The United States is by far the biggest recipient of goods, with neighbors El Salvador, Honduras, and Mexico following.
Whether you are already doing business in Guatemalan or planning to expand into this prosperous and growing market, read on to find out about the benefits of payroll outsourcing in Guatemala. Or feel free to contact us now to discuss your market entry options.
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What is payroll outsourcing?
However, in the event that you do not have an entity established in the country, or wish to avoid the expense and time commitment associated with company formation, you will likely opt for payroll outsourcing in Guatemala via a professional employer organization (PEO). Such a firm will hire local staff on your behalf, meaning you do not need to establish an entity to have workers overseas.
A PEO firm will also have an established recruitment network and will be able to seek out those local staff for you, as part of an additional service on top of the outsourced administration of your payroll.
When you use a PEO, which can also be known as an employer of record (EOR), they act as the official employer in the eyes of local authorities, and their service will also include on-boarding and off-boarding, as well as the drawing up of legal documents related to your overseas staff.
Some of the main tasks a payroll outsourcing company will be in charge of include:
- Making payments and completing tax procedures in accordance with local law
- Carrying out regular payroll and budget calculations
- Managing, registering, and updating information related to contracts and salaries
- Printing and delivery of pay stubs
- Making direct deposits of wages and benefits
- Preparing of management reports
What are the Benefits of Payroll Outsourcing in Guatemala?
Payroll outsourcing in Guatemala comes with a number of benefits, such as:
Cost effectiveness
One of the most attractive aspects of payroll outsourcing in Guatemala is the cost saving it generally involves. Because while you will have to pay a fee to the company providing the service, when you outsource payroll it means you can avoid the costs involved not only paying in-house staff, but also recruiting and replacing them.
Guaranteed compliance
Another key benefit of outsourcing your payroll is that you are guaranteed compliance with local norms and legislation. Because a payroll outsourcing firm will have vast experience in the market and will be aware of the latest developments in labor, corporate, and tax law, so you can rest assured that all statutory requirements.
In the event that you are looking to enter multiple markets at the same time, a PEO with an international presence will be your best option, because that way you will be able to manage all staff through the same company, regardless of the legislative differences in each jurisdiction.
Focus on other aspects of your business
As an administrative task that does not generate revenues in itself, payroll is an ideal function to outsource if you want to focus more of your efforts on more profitable aspects of your business. Because when you outsource payroll in Guatemala, that leaves your leadership team with more opportunity to focus on the likes of product development or building up contacts in your industry.
Time saving
Managing payroll is a time consuming activity, and while managing it internally will see the majority of that time commitment fall upon your in-house team, there will undoubtedly be times when managers and senior managers have to dedicate time to the process. When you outsource payroll, you eliminate such necessity, freeing up valuable time for senior people in your organization whose time is at a premium.
Expert advice
While the payroll outsourcing firm you hire will mainly be undertaking an administrative role, they will also be well-placed to provide expert advice on a variety of topics related to your overseas expansion, and not simply related to relevant legislation, but also on candidate profiles and market dynamics. Where that payroll outsourcing firm has an international presence, they will also be able to advise you on future expansion plans, based on their knowledge of the markets where they operate.
Use a payroll calculator to calculate hiring costs in Guatemala
If you would like to get an idea of the costs of outsourcing your payroll in Guatemala, it is worth seeking out a payroll calculator. Because while such a tool will not be able to give you a totally accurate figure, it will give you a very close estimate, as well as allowing you to compare payroll costs in competing markets.
One such example is the payroll calculator that can be found on the recruitment & PEO services page of the Biz Latin Hub website.
By using our tool, you will develop a good indication of the costs you can expect to incur when payroll outsourcing in Guatemala, or any of the other 15 countries in Latin America and the Caribbean where we operate.
Biz Latin Hub can undertake your outsourcing payroll in Guatemala
At Biz Latin Hub, our multilingual team of recruitment & PEO experts has the experience and know-how to meet your payroll outsourcing needs in Guatemala, as well as being on hand to activate our established recruitment network to find those staff quickly whenever necessary. With our full suite of market entry and back-office services, we can be your single point of contact to expand your business in Guatemala, or any of the other 15 countries across Latin America and the Caribbean where we have a presence. We also operate in Southeast Asia and the South Pacific.
Contact us now for further advice or a free quote.
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