Hiring a payroll company can save companies time and money. Payroll providers are known for masterfully navigating complicated tax regulations while assuring that payroll processes are carried out as accurately as possible.
However, some might hesitate to hire an outsourced payroll provider because of how critical the work is. It’s important that you can find a team you can fully trust with payroll duties and confidential information.
This article will define three factors to consider before engaging a payroll partner. These tips will enable you to select the best provider for your business needs.
Prepare for a Lengthy Relationship
It’s important to think long-term when hiring a new outsourced partner. If you take some time to think through your vendor’s priorities both now and in the future, you’ll enter the interview process with a general idea of the milestones for your partnership.
HR and accounting services, such as payroll, typically come with lengthier contracts than other partnerships. For instance, you may hire an app development company to create a platform. After that milestone is achieved, the partnership typically ends.
Payroll is a recurring and ongoing need, so it’s safe to say your partnership with a payroll services provider will be long-term. So, you should consider your short- and long-term expectations upfront.
According to a state of payroll services report from Deloitte, 69% of companies in the United States are satisfied or highly satisfied with their current outsourced payroll service arrangement.
These satisfaction trends indicate that businesses are thinking long-term with their payroll partners. Finding a partner that satisfies your needs creates a trusting, long-lasting relationship. Developing this relationship also benefits your business over time, as they’ll better be able to understand your unique needs.
Payroll providers should feel like a permanent, reliable part of your team. Foreseeing this long-term relationship early on will help determine which provider will best suit you and your business.
Discuss Your Part in the Relationship
It’s critical to discuss expectations for your team during the vetting process.
Payroll partners will have access to and a close understanding of your financial information, which may make some companies hesitate.
It’s important to remember that payroll services aren’t an all-or-nothing deal. Through managed payroll service providers, you’re able to select exactly which services you want to outsource to your partner. This prevents them from seeing proprietary information or from you losing too much control over your internal processes.
You’re always free to revisit this conversation after hiring a partner or request additional services you need. These partnerships are intended to be accommodating to your company.
Once you’re sure that a payroll company has the skills your company needs, engage them in a conversation about which services you need. Payroll companies can help you accomplish the following:
- Calculating payroll for all workers
- Determining tax obligations for each employee
- Printing and distributing paychecks
- Creating management reports
Technical and organizational skills are the core function of providers but finding a company that can effectively accommodate your priorities and preferences in working relationship will prove to satisfy you even further.
Find Referrals You Can Count On
Word-of-mouth recommendations are incredibly common in the HR and accounting industries as partnerships are long-lasting.
Deloitte found that outsourced payroll services are particularly popular in the United States. So, there’s a good chance that someone you know is already working with a payroll provider they like or knows someone that is.
Referrals from within your network are often strong contenders for the final contract. In fact, Nielson found that 92% of people trust recommendations from their network more than any other method of referral; especially if the referral is from a trusted colleague or friend. It’s easy to transfer your trust in that person to the company they’re recommending. This can be both comforting and convenient in a world of seemingly endless service provider options.
In addition to personal recommendations, it may be important to review objective material before making your final decision on who to hire. One way to vet a potential service provider is to read verified reviews from other companies about their experiences.
Once you’ve read first-hand accounts of working with various providers, you’ll have a better idea of whether or not they’re a good fit before even reaching out to them. From there, you can contact their representatives or do further research on their company website to determine if they’re a good match.
Combining word-of-mouth recommendations with objective reviews as research will make it easier to find a company with the skills and experience you need.
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Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.