How do you rapidly build a workforce across multiple African countries? The fact is, setting up a company and office in each country takes considerable time and investment.

But what if there was another way to grow your company? 

This blog spotlights the reasons why Workpay launched an Employer of Record (EOR) service across all African markets. We’ll explain how this service makes it easier to grow across the region, by reducing your time to market and simplifying your expansion strategy?

As we’ll see, an EOR-based growth strategy can transform your pan-African expansion by significantly reducing the barrier to entry and your overall risk. 

Launching your business in a new African country?

Naturally, you want to get your feet on the ground fast and hire employees quickly. Time is money. But many companies discover that the administrative burden and unfamiliar bureaucratic hurdles slow everything down. 

This was the problem one of our South African clients faced a few years ago when they wanted to hire a specialist team in Kenya. Without an established entity in the country, they were facing many months of delay and uncertain costs. 

Was there another way to get up and running without the delay or risk?

Why we launched a pan-African EOR service

Our partnership with Y Combinator has taught us that customer-driven product discovery is important for prioritizing your business focus. After recognizing the needs of our South African client, we realized we could make a difference for others facing the same challenges.

The next step was clear. A pan-African EOR service could help even more companies realize their potential. It would make it easy to quickly hire new staff across multiple countries. Without the risk of setting up a company in each new country, clients could ‘hit the ground running’ in record time.

After an energetic round of fundraising and many administrative hurdles, Workpay launched its EOR service across the entire continent.

What are the advantages of an EOR?

There are many ways a growing business can benefit from partnering with an Employer of Record (EOR) provider. These are the main reasons why a company should consider this growth strategy.

Less risk (but all the rewards)

Any new company must be able to quickly test new business models and make adjustments that increase productivity and customer satisfaction.

Imagine you want to expand into a new region, with the plan of hiring 100 new employees. Using an EOR means you can instantly hire a ‘pilot’ team to test the business model. As well as getting started sooner, it is easier to adjust your model to get the right market fit. You can scale up quickly or change course entirely without the same costs or risk exposure.

Once the business model is validated, you can then transition to setting up your own entity. It is a win-win, because you only take the risk when the business case is proven and you are already up and running. This strategy is a huge advantage compared to the much larger investments and risks involved when setting up an entire company.

Reduced complexity

Each country has unique rules and laws. Meeting your obligations for labor laws, taxes, and other compliance requirements in each new country adds a new layer of complexity. This, however, is an excessive burden if the (potential) rewards are not yet proven.

By partnering with an EOR, all these obligations are handled for you by experts. This greatly simplifies your business model.

Payroll as a Compliance tool

Managing HR and Payroll across multiple countries is often seen as a ‘cost item’ that must be handled.
This is true, of course. But it can also become a valuable tool for pan-African compliance if you approach it the right way. An EOR can make sure that all the stress and complexity of payroll and HR is handled for you and contained within a wrapper that ensures compliance throughout. This insulates your business from compliance risks, reduces costs, and increases tax efficiency.   

One HR and Payroll solution for all of Africa

Many people think that you need to use a different solution or vendor for each country.

Indeed, it used to work that way, and this was another factor that made pan-African expansion difficult in the past.

However, by using an EOR provider that covers all African markets, you can support your growing business with a single solution. This is a lot easier than managing numerous contracts with different vendors.

Making it easier to grow your business

We have seen that a pan-African Employer of Record (EOR) service can help a growing SME or multinational achieve their goals with less investment or delay. In just weeks, they can enter new markets and test new business models with minimized risk. 

The success of this model is proven by how in-demand it has become. In just a few years, our EOR service has grown from just 2 countries to more than thirty African markets. In fact, it now comprises more than 40% of our business. 

We believe that the demand for EOR services will only continue to grow as more companies see the strategic benefits for their expansion plans. It provides compliance, simplified business models, and a shorter time-to-market. By instantly gaining these capabilities, companies can get established in new markets with the maximum chance of success. 

Watch the podcast to see the whole conversation.

Want to learn more? Visit Workpay.com or reach out for a strategic conversation.