LUTZ BUSINESS INSIGHTS
5 THINGS TO CONSIDER WHEN CHOOSING A PAYROLL PROCESSING VENDOR
ERIN BAAS, Client Advisory Services DIRECTOR
There is no element of running a small business that can be more complex than payroll processing. Furthermore, getting it wrong can be disastrous. Not only are your employees counting on you, but federal and state taxing agencies are watching you.
Outsourcing payroll processing to an outside provider can be a good solution. If you are considering that route, there are several things you should consider about vendors before choosing one.
1. How much will it cost compared to what I’m doing now?
This is probably the first thing that comes to mind, and the question has many components, including:
- The price of doing your own payroll. What costs do you currently incur? If you are doing it manually, staff time accounts for much of it. If you have automated it, how much have you spent on hardware and software and staff time?
- The price of penalties. Payroll errors are expensive, and they diminish trust. An inexperienced inhouse employee can be more prone to costly mistakes than a professional.
- The price of outsourcing. Payroll service fees are all over the map. There may be a base fee plus an additional charge for each employee or one price per pay run or some other combination of charges. Are there other fees that you should learn about upfront?
2. What do you know about the vendor’s reputation?
There are payroll vendors that are household names in the industry. This popularity can speak to their reliability, but they tend to be some of the most expensive options. The bigger the vendor, the less likely you will get personalized customer service. If you are looking at a smaller vendor, make sure to do some investigating online to learn about their history and their level of client satisfaction. Do they have experts who can ensure that your payrolls and related HR requirements will be handled in compliance with state and federal regulations?
3. Will the vendor be able to accommodate you as your business expands?
Most vendors will tell you how many employees their services are able to handle. Keep this in mind as you consider how your company may grow.
4. How does the vendor handle communications with clients?
How do you report each payroll’s hours and other compensation and deductions? Will you be assigned a dedicated payroll expert or team who you can call or text or email with questions?
5. What are the vendor’s deadlines for pay runs?
Are they willing to do off-cycle payrolls when needed and is there a charge? What happens if you, or they, miss a deadline?
Our outsourced payroll services use innovative technology and payroll specialists who have many years of experience working with small businesses in numerous industries. Our staff gets to know who you are beyond salaries and hours and deductions, and we provide personalized, comprehensive service that you won’t find from vendors who only process payroll. We can even assist when you need to add or change your employee benefit plans, or when other areas of your business need attention. Contact us, and we will be happy to answer any questions you might have.
ABOUT THE AUTHOR
ERIN BAAS + CLIENT ADVISORY SERVICES DIRECTOR
Erin Baas is a Client Advisory Services Director at Lutz with over 15 years of experience. She provides business accounting and advisory services to a wide variety of industries with a special focus in private physician medical practices.
AREAS OF FOCUS
- Business Consulting
- Outsourced Accounting
- Healthcare Industry
- Private Physician Practices
- Professional Services Industry
- Financial Reporting
- Provider Compensation Plans
- Internal Control Reviews
- Strategic Planning
- Budgeting and Forecasting
- Practice Benchmarking
AFFILIATIONS AND CREDENTIALS
- American Institute of Certified Public Accountants, Member
- Nebraska Society of Certified Public Accountants, Member
- Nebraska Medical Group Management Association, Member
- Certified Public Accountant
- BSBA in Accounting, Creighton University, Omaha, NE
- Nebraska Wildlife Rehab, Treasurer
- 7 Steps to Improve Physician Retention
- Essential Healthcare and Financial KPIs to Begin Tracking Today
- 2021 Form 1099 Filing Best Practices for Medical Groups
- 6 Bookkeeping Tips to Keep Your Private Practice Healthy
- 5 Things to Consider When Choosing a Payroll Processing Vendor
- 6 Benefits of Outsourcing Your Accounting During Times of Crisis
- Still Doing Manual Accounting? It's Costing You Money
- Does Your Business Need a Financial Audit? Hot to Prepare
- Are You Making These Five Common Accounting Mistakes?
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