Case Studies: Payroll
With the right technology, firms are discovering that payroll can be a lucrative service offering that’s less time-consuming and cumbersome than it used to be. We spoke to three firms about their experiences working with some of the major payroll providers to solve their clients’ payroll headaches.
Firm: Payroll On The Go
Commencement date: May 2016
On record: Owner & founder Chris O’Connor
Process: Payroll On The Go has been in operation for three years, but has only been using SurePayroll since May. Currently, the company has four firm users on SurePayroll, which O’Connor has found “extremely simple” to implement and use. Starting with 15 clients, Payroll On The Go had 24 clients on the solution at the beginning of July, and aims to add one per day.
“I made the switch because the previous software I was using was way too cumbersome,” O’Connor said. “There were too many things I had to do myself, as opposed to SurePayroll, which is really simple. You simply enter the hours and numbers — with the other software I had to impound, manage where all the money went, and so on. With SurePayroll, they handle that.”
O’Connor said that the implementation process was “wonderful,” because once he entered the client and employee information, SurePayroll handled all the numbers, including historical data. Because of this, the transition from the previously used software to SurePayroll was smooth.
Advantages: Because of its simplicity, SurePayroll is “an excellent solution for the under-25-employee employer,” said O’Connor. Often, small employers do not want to deal with complicated data management and simply want to enter number of hours worked. “The taxes go where they need to go, the money goes where it needs to go, and when it needs to go. You don’t have to worry about timing.”
And as an accountant, O’Connor said, he likes not having to worry about getting his clients’ taxes paid. “Once I run the payroll or my client runs the payroll, it’s done — there’s nothing else to worry about.”
“One of the best things about SurePayroll as a company is its accessibility,” O’Connor shared. “One of the things I do with my sales rep every week is send him a list of things I would like to see updated, and I can actually see progress from their team. And they always respond, too, which is wonderful. I send an e-mail to [my sales rep] on Friday and they respond by Monday. I know at least my concerns are being heard, whether or not it gets addressed right away.”
SurePayroll offers a 10-minute demonstration that O’Connor said puts worried clients at ease once they observe how easy the program is to use. “It’s a real easy sell,” he said.
Challenges: The difficulty with SurePayroll lies in its interaction with larger employers. If, for example, a company is trying to switch to SurePayroll from a different program but has its 401(k)s and insurance rolled in with that program, switching becomes very difficult.
“Sticky products, I like to call them,” O’Connor said, because of the implications involved with rolling them over. “However, if the company has its 401(k) outside of its payroll provider, it’s a piece of cake to bring that over.”
SurePayroll also does not offer insurance services to every type of industry, with some exceptions being certain construction contractors (but not all) and bars.
“There’s a little bit of hit or miss with that that makes my selling a little difficult, because I have to reach out to somebody else [at SurePayroll] before I know whether I can get certain new client insurance or not as opposed to just running with it myself,” O’Connor said.
Next steps: As Payroll On The Go adds more clients, O’Connor’s goal is to “help be the influencer within the company to help them grow as well.”
Because SurePayroll’s team is nimble, O’Connor said he is able to close out deals at “a phenomenal record pace.”
Dollars for time
Firm: Michael Sandidge’s H&R Block franchise
Product: RUN Powered by ADP for Partners
Commencement date: January 2015
On record: Franchisee Michael Sandidge
Process: Sandidge just happens to be the kind of accountant who likes to know every little detail involved with the tools he uses. Because of that, the implementation of ADP’s payroll software took him a little bit of time — but it’s not difficult. Sandidge’s franchise previously used Intuit’s QuickBooks payroll product, so implementation of ADP’s product was simply a matter of knowing what to click for which function.
“Once you get past the learning process, ADP makes it pretty easy,” Sandidge said. “They have a full implementation service if you want to use it, but with that you give up a little bit of control in how you want things laid out. [With] a really small client, I’ll set this up myself; [with] a huge client, we’ll pay ADP to do it all. It’s a learning process of when to do it ourselves, but overall it’s very simple.”
Sandidge added that for an existing client, training one of his employees on how to implement them in ADP takes an hour or less.
Advantages: The major benefit of ADP’s payroll product is the “massive time savings.”
“That was the ultimate incentive,” Sandidge said. “We cut our workload maybe 60 percent because we just enter hours and deal with the day-to-day operations of payroll. We’re not printing checks or stuffing envelopes. All that is gone. We log in, enter hours, hit submit. We don’t send reports because the client can do that themselves.”
H&R Block also offered incentives for franchisees who made the switch, such as the elimination of quarterly and W-2 reporting, giving the franchises breathing room to focus on taxes.
Challenges: The other side of the time savings coin is cost. While ADP’s payroll product saves a lot of time, it is more expensive than some other options on the market.
“When I talk to people, I say we are turning our dollars into time,” Sandidge explained. “You put in dollars so you get time back — but there will be people who don’t need that, because they have the time and they don’t have the dollars.”
However, features such as free direct deposit, free viewing of check stubs through a mobile app and payroll reporting accessible to the client are the carrots with which Sandidge attracts his clients.
ADP provides a broad payroll product with a range of capabilities, but doesn’t give users too much control over customization. “ADP is in charge and responsible for everything, so there are a lot of things they won’t let us change,” Sandidge said. “It’s very cumbersome to fix things, so don’t make mistakes!”
Next steps: Sandidge hopes that in the future, ADP will provide payroll as more of a white-label service so that H&R Block can brand and customize it.
Secondly, Sandidge sees ADP’s cloud-based payroll service as a stepping stone to get his clients using more cloud-based accounting solutions. “It’s an in for our clients,” he said. “So you’ve just experienced cloud-based payroll — let’s take the next step. Let’s experience cloud-based accounting software and cloud-based applications to get you in the 21st century. You don’t need to own a computer and sit there with a copy of QuickBooks and update it every three years. Let’s get you modernized.”
Firm: Cirrus Payroll
Product: AccountantsWorld Payroll Relief
Commencement date: 2012
On record: Founder and president Tyler Winn
Process: Before Winn implemented AccountantsWorld’s cloud-based payroll product Payroll Relief, he did a “full investigation” of the other products on the market.
“Payroll Relief fit the bill because I was looking for an online solution,” Winn said. “I wanted to be a completely paperless, online payroll company. My employee and I work in separate physical locations but are able to work on the same platform and do things pretty smoothly.”
Payroll Relief is an “out-of-the-box solution,” and Winn was able to white-label the product with his branding and logo easily. When his clients log into the system, they see Cirrus Payroll’s logo. They do not deal with AccountantsWorld at all, and Winn is able to be the true intermediary.
“Implementing the software, it didn’t take more than a day or two to get all my information populated,” he recalled.
Advantages: The biggest advantage of Payroll Relief is its ability to provide Winn true mobility. When he founded Cirrus Payroll, Winn’s vision was to create a company that was entirely paperless, and Payroll Relief has enabled him to do so.
“On their side, the clients most definitely appreciate the paperless aspect,” Winn added. “Some companies have paperless systems where you can go in and pull all this stuff, but they insist on continuing to mail a packet every week or two weeks depending on the employer’s pay schedule. I always tell people I’m not going to put more paper on your desk, because frankly, nobody wants it.”
Clients have access to pull reports around the clock, and they can access it on their computers or phones. “We make all that available to our clients online,” he said. “And employees can pull their paystubs too, so there’s no reason to mail anything.”
Nonetheless, for client comfort, Winn makes sure he always has “boots on the ground” in Tulsa, Okla., where his company is based. But his clients are spread over 20 to 25 states, and materially, with the way Payroll Relief allows him to function, location doesn’t make a difference.
Winn also noted that Payroll Relief is particularly user-friendly for accountants, with reports and information organized in a way that makes sense to a CPA.
Challenges: Payroll Relief does not yet provide 401(k) services, but this is actively in the works. Because Winn keeps his clients at the under-50-employee range, he hasn’t found this to be a disadvantage, as his current clients do not need him to provide 401(k) capabilities.
One of Cirrus Payroll’s first clients was a restaurant, which is an industry where, very often, not all employees will have direct deposit. Because Winn was determined to be entirely paperless, this presented an early challenge. But this client was using QuickBooks for their bookkeeping, and he quickly found out he could send them a PDF of hard checks. All they had to do was print them out using the QuickBooks checks template.
“To be perfectly honest, if I had major challenges, I would switch,” Winn said. “It’s very important to me to have a smooth process. If there were major bumps I wouldn’t be with the software.”
Next steps: Winn often partners with accountants who don’t want to provide payroll services to their bookkeeping clients. His goal is to create more of those partnerships, working with peers to show them that, when done the right way, payroll can be a lucrative business.