How much valuable capital could you be saving?
A whopping 45% of service companies such as staffing firms fail by just their fourth year in business (Statistic Brain), with insufficient funds as a leading reason.
It’s no question that acquiring and saving as much money possible is incredibly important for a growing staffing firm, or any business trying to establish itself. But when the owner of a small-medium sized staffing firm is handling their payroll duties all by themselves, there are certainly a number of financial burdens and risks at play.
Let’s talk about two key ways outsourced payroll services will help you to avoid strenuous and unnecessary costs:
In-house payroll services and provisions cost a pretty penny.
Expending valuable money on training and employing an in-house payroll manager (or multiple) can be very costly for a small to medium sized staffing firm. In fact, Officevibe.com reports that the average cost per new hire for a business has soared to $4,000 per hire. Aside from paying your payroll employee or employees a regular salary, there are also benefits, vacation pay, potential maternity leave, and other employee expenses that can weigh heavily on your available finances.
On the other hand, the software and hardware needed to manage payroll in-house will also cost you. Payroll software can be expensive and typically requires a lot of upgrading. Cost of a quality printer, ink and paper which must be constantly refilled, checks, etc. – it adds up.
These are all investments that you don’t even need to spend a dime on if you chose to outsource your payroll responsibilities to a back office solutions company. But thankfully, the many expenses of in-house payroll management need not be an issue when you outsource to the pros that are already equipped with all of the necessary tools.
Payroll errors are very easy to make – and the fines are substantial.
The IRS states that around 33% of employers make payroll errors that ultimately cost them billions of dollars in penalties annually, and 40% of small businesses dish out an average penalty of $845 annually due to late or incorrect filings and payments.
Not only are these penalties and fees financially draining, but a payroll error that puts your employees in financial distress can seriously anger them and break their trust – potentially costing you a diligent team member, or several. In fact, according to Glassdoor.com, the average (U.S.) company spends roughly $4,000 hiring a new employee, which can also take up to 52 days to fill. And, according to hundred5.com, the average company can lose anywhere between 1% and 2.5% of their total revenue just to bring their new hire up to speed. So it’s certainly critical for companies to take every precaution necessary to keep their valuable employees on board.
It can be easy to miss a remittance deadline as our tax law and regulations are frequently undergoing modification to make paying on time even more difficult. With that being said, these regular changes are something that every busy and focused staffing agency owner shouldn’t have to keep up with. Fortunately, outsourced payroll mitigates the risk of having to pay such hefty fines, and ultimately saves your staffing firm important funds.
Outsourcing payroll is in your Canadian staffing firm’s best interest.
If you’ve been managing payroll in-house, you’ve been dedicating valuable time and effort to something you don’t even need to be thinking about. An experienced, reputable payroll and back office solutions company will help you ensure your staffing agency is putting its time, money and effort in the right places.