HR Outsourcing vs In-House HR: Which Is More Cost-Effective for Malaysian SMEs?

Companies often wonder: should we build an HR team or outsource to a specialist?

This article compares both options by exploring costs, risks, and hidden burdens for Malaysian SME businesses.

💵 In-House HR: True Cost Breakdown

1. Employee Total Cost (CTC)

Salary, EPF, SOCSO, benefits = RM4,500/mo average

2. Technology Costs

HRMS subscriptions and upgrades

3. Training & Development

Onboarding, compliance and statutory training

4. Overtime & Additional Tasks

Seasonal workload, churn, or statutory changes

💡 HR Outsourcing: Real Costs & Benefits

Fixed monthly fee simplifies budgeting

No benefits, office space, or training costs

Expert handling of compliance, payroll, HR admin

Scalable service as your business grows

🧮 Breakdown of Estimated Cost

Cost Component

HR Salary + Benefits

HRMS Subscription

Recruitment Costs

Training & Updates

Total Monthly Cost

In-House HR

~RM4,500/month

~RM500/month

RM2,000/job

~RM300/month

~RM5,300/month

Outsourcing to FIND Global

N/A

Included

Included*

Included

from RM600/month

⚖️ Which Option Is Right?

HR Outsourcing is ideal if you have limited headcount (<50), fluctuating HR needs, or want to avoid HR admin burdens.

In-House HR becomes viable when multientity operations or internal culture/strategy are priorities.

✅ Why FIND Global’s Model Wins

Modular approach: HRAS, payroll, and recruitment in one package

Transparent service—no surprise fees or hidden charges

Local compliance expert in Malaysia

Flexible scaling as your business demands

Ready to compare HR solutions? Book a free consultation today.

FIND Global connects individuals and businesses through job placements, HR outsourcing, payroll services, and upskilling programs.
We empower the modern workforce with career tools, training, and language classes—helping people and companies grow together.