Back Office Services in El Salvador: Understand Your Options

For anyone starting a business in El Salvador for the first time who would like to limit their administrative burden or in-house workforce, seeking out a back office services provider could be the ideal solution. Because when you outsource back office services in El Salvador, not only can you relinquish a lot of the paperwork involved in running your operations and avoid having to hire staff for that purpose, but you also tap into expert knowledge of the local market that could bolster your commercial success.

VIDEO: Expand your business to El Salvador

El Salvador has enjoyed significant economic and political stability in recent years that has seen the Central American country emerge as an increasingly attractive destination for investment, with gross domestic product (GDP) reaching $27.03 billion in 2019 (all figures in USD), while foreign direct investment (FDI) inflows hit $724.8 million that same year — representing a 75% increase on 2018.

The country has seen a corresponding rise in prosperity, with gross national income (GNI) hitting $4,000 per capita in 2019, to move the country into “upper-middle income” status based on World Bank standards.

El Salvador is a member of the Central American Common Market (CACM), which also includes Costa Rica, Guatemala, Honduras, and Nicaragua, and is party to a number of free trade agreements (FTAs), including the Central America-Dominican Republic FTA (CAFTA-DR), which provides preferential access to the United States and the Dominican Republic markets.

Some of El Salvador’s prime export commodities are sugar, garments, and electrical devices, with its main export destinations being all of its CACM partners and the United States. The country’s main imports include petroleum and medicines.

If you are thinking of entering this dynamic market, read on to learn about how back office services in El Salvador could be an attractive options. Or go ahead and contact us now to discuss your business options.

A graphic offering a snapshot of the market in El Salvador, where you may wish to contract a back office services provider

Advantages of outsourcing back office services in El Salvador

National Palace of El Salvador, in San Salvador city, where most foreign executives hire back office services in El Salvador.
National Palace of El Salvador, in San Salvador city

Outsourcing back office services in El Salvador when doing business in the country carries a number of advantages, including:

Streamlined operations: By outsourcing legal services, accounting and taxation, recruitment, or a variety of other functions, you significantly reduce the amount of in-house staff you need to directly employ, as well as the amount of administration your people have to oversee.

Increased efficiency: With administrative tasks taken care of, those staff who you do employ will be able to dedicate themselves to operational concerns without distraction.

Cost reduction: While there will be fees to pay your back-office services provider, they will likely be more than offset by the savings you make thanks to the agility you enjoy entering and leaving the market.

Market agility: When you outsource back office services, you are able to increase or reduce that service provision at short notice, knowing that your provider will have the staff you need on hand as and when you need them, providing you greater agility in the market, which also allows for a rapid departure from the market where all local staffing is outsourced.

Guaranteed compliance: Your back office services provider will have ample experience in the market and a track record of complying with all local norms and regulations, meaning you can rest assured that your operations will be in full compliance with local laws.

Specialized advice: The experience your provider has in back office services in El Salvador will mean they are well placed to advise you on unexpected pitfalls you may encounter, as well as to offer advice on services and other considerations that past clients have found beneficial.

What do back office services consist of?

Back office services in El Salvador can include a whole series of services aimed at supporting your company in its day-to-day operations, as well as through periodic statutory reviews. In some cases, a service provider will be focused on one particular service, or one area of service, such as accounting & taxation or legal services. However, other service providers are able to offer a more comprehensive package that covers both of those, as well as the likes of recruitment, commercial representation, and company formation.

Below are some of the key back office services that may be of interest to investors entering El Salvador, or elsewhere in Latin America and the Caribbean.

Accounting & Taxation

A back office service provider with accounting capabilities will be able to oversee your accounting and taxation to guarantee that you are fully in compliance with local norms, while also seeking out opportunities to manage your taxes via tax advisory services.

Commercial representation

A man signing a document, representing a man outsourcing back office services in El Salvador.
Legal Services are crucial to your business expansion

Whether you are planning to establish a legal entity in El Salvador or elsewhere in the region and do not intend to be based in the country, or you simply see the benefit in having expert advice from someone with years of experience in a market you are getting familiar with, seeking out a back office services provider to provide you with commercial representation could be a good choice. Because they will be able to help you safely navigate any foibles of the local market and run your operations as smoothly as possible.

Your commercial representative should be able to offer advice in the following fields:

  • Market opportunities
  • Main competitors
  • Feasibility of your product
  • Distributors/sales agents
  • Potential strategic alliances and industry groups

When your contract back office services in El Salvador from a company that offers legal services, you will be able to count on a host of specialized corporate legal processes that go beyond simple legal advice related to your business. Those services include company formation and due diligence — which can be crucial to keeping your business in a healthy state and avoiding dealing with unsuitable partners — as well as the likes of visa processing.

Some key areas in which corporate legal support can add value to your operations in El Salvador include:

  • Advice on the proper legal structure of your company
  • Support in the process to obtain licenses to export or import products
  • Drafting of contracts with employees and suppliers

Hiring & PEO as back office services in El Salvador

Another key area of support you can receive for your business is in hiring local staff. When you go to a back office services provider with hiring capabilities, you tap into an established recruitment network, elevating your chances of finding the right staff in the shortest time possible. Where that service provider is able to act as a professional employer organization (PEO), they can even hire staff on your behalf without the need for you to have a legal entity established.

Meaning that, in effect, if you contract staff via a PEO, you could have a local workforce without having to go through the more costly process of establishing your business in the jurisdiction. Such an approach also makes a withdrawal from the market a straightforward process.

Biz Latin Hub can be your back office services provider in El Salvador

At Biz Latin Hub, we offer a full suite of back office services that can guarantee the success of your commercial operation in El Salvador. Through our high-quality market entry, commercial representation, legal, HR, and visa processing services, we can be your single point of contact to establish and manage your business in El Salvador and any of the other 15 countries across Latin America and the Caribbean where we are present.

Reach out to us now for personalized assistance or a free quote.

Learn more about our team and expert authors.

Infographic: Biz Latin Hub services
Our services offered at Biz Latin Hub

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