Statistics from 2017 show that the total value of outsourced payroll in the U.S. is in the neighborhood of $74 billion annually. More than 300,000 businesses are involved in the payroll sector to some degree or another, employing more than 1 million workers. Outsourced benefits administration is even more impressive. Just over 29,000 companies involved in the sector are generating upwards of $78 billion in revenue.
These numbers should tell you something. What, exactly? That demand for both outsourced payroll and benefits administration is significant. What the numbers do not tell you is that you can save time and money by outsourcing both payroll and benefits administration to a single provider.
We are one such provider. In fact, we are an industry leader in both payroll and benefits administration. We would be able to speak with you about how our services can make your business run better. If you're not quite sure of the advantages of going with a single provider, consider the benefits listed below.
1. Lower Overhead Costs
You already know that keeping payroll and benefits in-house involves some amount of costly overhead. One of the reasons you've outsourced is to reduce that overhead. But think of this: each of your providers also has its own overhead to worry about. Going with a single provider reduces total overhead by keeping both payroll and benefits under one roof.
Because there is so much duplication in payroll and benefits, you are duplicating overhead by going with two providers. A single provider utilizes the same staff to handle both. It uses the same computer system, the same software, and so on. Save money with one provider by eliminating the duplication.
2. The Economics of Scale
It is generally bigger companies like ours that offer both payroll and benefits administration together. And just like any other industry, larger companies can provide their services for less based on the economics of scale. Larger companies are more apt to earn profits on volume rather than per-unit pricing, giving them a competitive advantage. We certainly do. We can charge less for our services because our customer base is so large.
We can also save our clients a bit of money on some of our benefits packages. We work with nationally known providers to offer great plans at great rates. And once again, we get these great rates thanks to the economics of scale.
3. A Single Account Support Team
Your account support team members are your experts in all things payroll and benefits. If you work with multiple providers, you undoubtedly have multiple account teams to deal with. That means more time to sort out problems. It means more time spent getting answers and modifying services. On the other hand, a single provider saves time by presenting you with a single account team capable of handling everything.
4. Consolidated Software
A single provider offering both payroll and benefits tends to utilize a consolidated software package that keeps everything in the same place. That means your HR team only has to learn one software package. They have just one online portal for data input, checking records, making changes, and so forth. One piece of software means less time spent on administrative tasks.
You can continue to outsource your payroll and benefits administration to two different providers. If you're outsourcing one while keeping the other in-house, you can continue following that strategy as well. We recommend consolidating both under one provider, though. A single provider saves you time, money, and plenty of headaches. We know. We are experts in payroll and benefits administration. If you're interested in learning more about outsourcing both payroll and benefits administration to one source, request more information today.
1. IBISWorld – https://www.ibisworld.com/industry-trends/market-research-reports/professional-scientific-technical-services/professional-scientific-technical-services/payroll-bookkeeping-services.html