Have you ever wondered when/if you should outsource payroll processing services? Whether you have a few employees or many employees, assigning the payroll processing and other payroll responsibilities to somebody else can save you a lot of money, time, and a headache.
What is payroll processing?
Payroll processing refers to the task of managing the payment of wages, including bonuses, by a company to its employees. The steps involved in payroll processing typically include gathering employee time information for a selected time period, managing benefits & deductions, and distributing employee pay for that time period.
When should you outsource payroll processing services?
While the process varies from company to company, the process is not simple and things can get complicated rather quickly. Errors can be made and be rather costly. Take a look at some of these statistics about payroll:
- 66% of Americans would experience financial difficulty if their paychecks were delayed by one week. (National Payroll Week)
- 36.5% of U.S. private businesses pay their employees biweekly, making it the most common pay period. (Bureau of Labor Statistics)
- 54% of employers state there is room for improvement in their current payroll policies and practices. (Earnst & Young)
New businesses and start-ups may want to consider outsourcing payroll right from the beginning to avoid this costly mess and rather challenging process. Outsourcing payroll processes is a great way to increase operational efficiency. When you outsource these services, you have more time to focus on your businesses core business functions that will increase your bottom line.
Consider your reasons for outsourcing. Your goals should include:
- Gain more time and resources to focus on core business activities
- Lower costs and business risks
- Streamline payroll processing as your business grows
While you may think you’re saving money by managing payroll in-house, it is actually opposite. Calculate how much time your employees are devoting to payroll activities—it’s probably a lot more than you think. Compare how much you’re currently spending to the plans payroll providers offer. The amount you’ll save by outsourcing will likely surprise you.
Contact an payroll services professional today and schedule your free consultation.