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Leo L.:
Do you know that there are over 30 million businesses in the US and that 88% of them have less than 20 employees? That’s right. Small businesses are the engine of the economy. But here’s the problem. Payroll, it’s a very complicated, exhausting thing, and it can get you into a lot of legal trouble if you don’t do it right. So in today’s video we’ll be talking about the five reasons why you must outsource your payroll today and who the best payroll service provider is.
Leo L.:
Hey everybody, welcome to Scaling to Seven Figures And Beyond. I am your host Leo Landaverde and today I have my great friend and trusted payroll partner, Josh Gilbert, here with us to talk to us about payroll. Let’s do this.
Leo L.:
If you’re ready to grow your business to seven figures and beyond while creating the financial freedom and the lifestyle that you want, then subscribe to this channel. And don’t forget to hit the bell so you’ll be notified every Wednesday when new content comes out. Hey, as I said at the beginning, payroll can be a very complicated and potentially risky thing for you as a business owner. So here are the five reasons why you need to outsource your payroll.
Leo L.:
Number one, is convenience.
Josh Gilbert:
What’s up everybody? So Leo, we talk about convenience. The first thing we need to look at is how easy does your payroll company make it for you? So what are some of the ways you want to talk about? Phone in your payroll? Email, fax, do it online. It’s about half the cost to outsource your payroll as opposed to doing it in-house.
Leo L.:
Wow.
Josh Gilbert:
Yeah, can be a big savings.
Leo L.:
How often did you find your clients outsourcing?
Josh Gilbert:
Quite a bit. A lot of people want to move from in-house to outsourcing because of some of the things that you can do. You can make changes on the fly with employees. Calculations are done for you. All the checks are processed for you and it’s so easy to update the information.
Leo L.:
So the next one is functionality. Josh, what’s the deal with functionality?
Josh Gilbert:
Functionality is important because we have to look at what the payroll company can actually do for you. What kind of services do they offer? Direct deposit. That’s a simple easy one. But are they making the tax deposits for you? Are they doing electronic onboarding of employees so that the new hire paperwork is significantly reduced for you? Tax credit processing, integrating your worker’s comp premiums with the payroll, being able to integrate your benefits. Time and attendance systems is also a big thing. And now you can do things like facial recognition and biometric time clocks. Those are the types of things you need to look at.
Leo L.:
So number three is accuracy. Josh?
Josh Gilbert:
Accuracy is a big deal because there are a lot of stories that will come out about small payroll companies seemingly making the deposits for our client. And then before you know it, they’re living on a yacht somewhere. So you’ve got to make sure they assume the liability for the work that they do, and that they’re actually making the deposits for you, because the average tax penalty is about $800 for a small business employer. So are the taxes being done? Are the quarterlies being filed? Is the year end work, like the W2s and 1099s, being done for you? This needs to be done and if a penalty comes up, the payroll company is going to absorb that for you.
Leo L.:
Okay, so number four is compliance and this is a big one, Josh. Tell us why.
Josh Gilbert:
It’s a scary topic because every state has different regulations that you have to follow as a business owner. Here in California, for example, we’ve had over 40 labor law changes in the last three years alone, but a few things to think of that go across the board. New hire reporting for child support enforcement, sick leave and PTO, minimum wage changes, things like that.
Josh Gilbert:
But another thing is reducing your legal fees. A lot of payroll companies now can help you with human resource services. Do you have an employee handbook? Are your policies and procedures up to date? Do you have your labor law posters? Are you doing background checks? All of those things can be handled by talking with HR certified professionals.
Leo L.:
Number five is service. Now, I know compliance was a really big deal on the last point. Service is a big deal for me. I know what it’s like to get good service from a payroll company and what it’s like to have bad service. And let me tell you, service can make or break a payroll company. What do you think, Josh?
Josh Gilbert:
I think service is everything because even if you have a good setup on the front end, if you have bad service, you’re not going to stay with that company. So what kind of support are you getting from the sales professional you work with, as well as the client services team on the inside. But you also have to look at some things up front. Are they getting great ratings with the Better Business Bureau? A plus rating is the best you can have. What are the client satisfaction surveys look like? And then there’s also something called a net promoter score. It ranges anywhere from negative 100 to plus 100 and it measures things like client satisfaction, loyalty, and would they refer that payroll company to someone that they know in business? Anything over 50 is considered excellent. How does your company measure up?
Leo L.:
Please comment below and let me know how you’re currently handling your payroll. Are you doing it by yourself or are you getting the help of a payroll company? And what challenges, if any, you’re experiencing with doing your payroll? Your opinion is very important to me. Let me know.
Leo L.:
Also, if you want to join a community of like-minded successful entrepreneurs just like you, then join our Facebook group at the link below where I share tips, tactics, and strategies on how my clients are growing their businesses to seven figures and beyond.
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