Small Business Owners Go It Alone
More than half of small business owners are handling payroll, human resources and benefits administration by themselves, according to a new survey.
The survey, by payroll service provider Paychex, found that more than one-third of those relying on a service provider to administer such functions say peace of mind is the most important reason for doing so. The results were included in the company’s latest Paychex Small Business Snapshot.
According to the Paychex Small Business Survey, of the more than 300 business owners surveyed, 56 percent of small business owners are administering payroll on their own. Sixty-five percent say they are handling HR administration themselves, and 59% reported taking care of their own benefits administration.
“Whether you’re a small local bakery or the owner of a 300-employee construction company, payroll, HR, and benefits are all critical functions for your business,” said Paychex president and CEO Martin Mucci in a statement. “The challenge lies in managing and integrating these functions while staying compliant in today’s highly complex regulatory environment. That’s why we recommend relying on the expertise of a partner like Paychex to help provide peace of mind where these key business functions are concerned.”
For the accounting community, the ability to counsel clients on how to best manage such tasks can help to reinforce the relationship between a client and his or her most trusted adviser.
According to certified public accountant Todd Zgoda of Bruce Zgoda, CPA, in Buffalo, N.Y., the risk of potential repercussions tops his list of reasons to recommend clients enlist a service provider to administer business functions such as payroll, HR and benefits.
“From forgetting to file returns or make payments on time to unknowingly failing to comply with new regulations, the hard lessons business owners can learn are very real,” Zgoda said. “Many times, it only takes one financial penalty to waste whatever money a business owner thought they were saving by administering key functions like payroll themselves.”
Overall, 40 percent of survey respondents said the biggest benefit of outsourcing payroll is the peace of mind it provides where regulatory demands are concerned. That number increases to 63 percent for those businesses with 20 to 99 employees.
Twenty-three percent of survey respondents said relying on the expertise of professionals was the biggest benefit to outsourcing payroll, while 19 percent said saving time is the most beneficial aspect of choosing to work with an outside service provider.