Building a thriving payroll practice: A practitioner’s perspective
As an independent payroll provider, securing and keeping your clients is your biggest challenge when your competition includes major corporate payroll providers. Why would small-business owners work with an independent payroll provider like you? Those were the exact thoughts running through my mind when I started my payroll practice over six years ago. Today, my small team and I service hundreds of clients, and Cirrus Payroll is growing faster than ever.
If you want to grow your existing practice, or start one from scratch, you need to implement four key strategies.
1. Define your company work style
You must decide up front what kind of payroll service you want to build. Set a vision that meshes with your lifestyle. We started out with a couple key priorities:
- We will operate as an online company, where employees can work remote, rather than congregating every day at an office. This means we needed a secure, cloud-based payroll software. (We use Payroll Relief from AccountantsWorld)
- We will be 100 percent paperless. This was a huge decision, because it meant that we would not be printing and mailing paychecks. Instead, our clients’ employees are paid via direct deposit, pay card, or in-house check printing.
2. Define your processes
I read the book “The E-Myth” right around the time my business started. It drilled into my head the importance of creating the right processes, and writing them down. This means that new client onboarding, payroll processing, quarterly filing, year-end tasks, and even client terminations are documented step-by-step, so there’s never a question of how to get the job done.
Too many payroll services don’t have consistent processes in place, catering instead to their clients’ whims. In our experience, defining good processes for our clients is what has created a delightful experience for everyone. For example, we don’t allow our clients to call or fax in payroll. Hours must be submitted by the client via their online portal. This drives huge efficiency within our service.
When you have good processes, you’ll be amazed what your employees can handle. I’ve seen some accounting firms whose staff struggle to process 50 payrolls. That is a symptom of poor processes. When your processes are streamlined, one staff member can handle hundreds of payroll with ease, generating extreme profitability for your payroll service.
On top of that, your employees will love their jobs! There’s nothing quite like a company where employees are passionate about what they do, and everyone knows their role and exactly how to get it done.
3. Define your ideal clients
We decided early on that we wouldn’t go after the “big fish.” We would focus on small businesses that are comfortable working with an online service. If clients are too big, or aren’t comfortable working with a paperless company, or if they have complex needs that our software cannot handle with ease, we kindly let them know that we aren’t the best fit.
The market for small-business payroll services is huge. If a client isn’t right for us, we simply move on to the next prospect!
4. Market like it’s your full-time job
Most payroll companies are terrible at marketing, with confusing websites, no social media presence, and zero differentiation from competitors. There are few key areas you should be focusing on:
- Fix your website. If it looks like every other website in your industry, something is wrong. Use compelling copy to showcase how your payroll service is different from the national competitors. And make it easy for people to do business with you, but providing “Get a quote” buttons and offering live demos.
- Request online reviews. Many of the national payroll bureaus have bad reviews online, so this is an area where you can stand apart. Start by asking your best clients to write a review for you on Google and Facebook. Once you get some good reviews, request reviews as part of your new client onboarding process. And don’t be afraid to ask repeatedly for reviews. People are busy and need friendly nudges.
- Network with the right people. What kind of professionals hear about client payroll needs before you do, and can refer them to you? Typically it’s other bookkeepers, accountants and tax preparers, and bankers and attorneys. These are the kinds of people you need to meet and demonstrate the value you can provide, so when they hear the need, they’ll think of you.
Remember that these tips are just the beginning. You must have the will to succeed and the wisdom to make prudent decisions. But with the right vision and execution, you can build a profitable payroll service of your own.