Hybrid Payroll software can yield big savings in a tight economy
Across every business, executives are hunting for fat to trim during the current economic downturn. For the HR and accounting departments, it seems like the wrong time to suggest software improvements. But some software investments produce a very fast return on investment (ROI) through cost cutting and increased productivity. Payroll software has that potential.
Can you dramatically cut your company’s payroll costs without sacrificing jobs or employee satisfaction? You bet.
Bring payroll in-house while outsourcing your tax filing and compliance and watch your savings add up. Some of our clients save tens of thousands of dollars each year with this strategy and also improve the accuracy of their payroll. Add a payroll card option to your direct deposit capabilities and you can save even more by eliminating paper paychecks.
Payroll processing expenses reduced by 70%
At Dresser & Associates, we implemented a hybrid payroll strategy for Henley Enterprises, Inc., a 600-employee, multi-location client who wanted tight control over payroll information but needed help with the complexities of tax filing and W-2 and 1099 printing. Henley Enterprises operates 65 auto care franchises on the east coast and had been spending in excess of $100,000 per year to outsource payroll processing. They were still doing 90% of the work and sometimes the payroll wasn’t even accurate – a real hassle for employees.
We implemented Sage Abra Payroll and reduced Henley Enterprises’ payroll processing costs to just $30,000 per year. It wasn’t long before our client had recovered the cost of the software and could enjoy more than $100,000 per year in savings, even after paying to maintain and support the Abra Payroll system.
In addition to the reduction in costs, Abra Payroll also provides Henley Enterprises with the flexibility to run unlimited trial payrolls, cut paychecks on demand, and process checks and direct deposits. By eliminating redundant, manual data entry, the payroll team saves one full day of labor each week. With complete control over sensitive employee data, they are enabled to produce a reliable payroll every time.
Tax compliance made easy
Next, we made sure that the accounting manager and HR manager at Henley Enterprises wouldn’t need to stress over complex payroll tax filings. To avoid potentially costly mistakes or penalties, we set up Henley Enterprises on Sage Compliance Services. This tax filing and payment service supports all filings, including federal, state, and local payroll taxes; SDI and SUI filing; and provides other services, such as W-2 and 1099 printing, and W-2 electronic filing. Best of all, our clients spend only about $1,000 per month on this service – compared to the $4,000 per week they used to pay for payroll outsourcing!
In total, Henley Enterprises estimates that it saves $15,000 every month with the hybrid payroll. The staff there continues to be pleased with their decision to bring payroll in-house with Abra Payroll while outsourcing tax filing and payments with Sage Compliance Services.
Payroll cards save another $1-2 per employee, per pay period
When you move employees from paper paychecks to electronic payment, your company saves a lot. NACHA Electronic Payments Association estimates direct deposit electronic payment to cost approximately $.60 per transaction. Printing and distributing a paper paycheck can cost $1-2 per employee, per payroll, according to the American Payroll Association. Need to reissue a check that has been lost or stolen? That’s another $10-12.
You probably already utilize direct deposit to pay some, or even most, of your employees. But up to 25% of Americans don’t have a bank account and therefore cannot participate in direct deposit. To increase the number of employees on electronic payment, consider adding a payroll card, such as Sage Payroll PayCard.
Sage Payroll PayCard works just like a debit card and carries the Visa® brand, with funds protected by Visa’s Zero-Liability policy. Sage Payroll PayCard is a perfect way for employees without bank accounts to receive their pay automatically, without the hassle and expense of check cashing services. For many companies, paycards significantly lower payroll costs by further reducing or eliminating the need to print paper paychecks. You can calculate potential savings with our Sage Payroll PayCard Savings Calculator.
Free Hybrid Payroll Webinars
Find out how your company can realize big savings with in-house payroll and outsourced tax filling. Join Dresser & Associates for a FREE Webinar that demonstrates how bringing payroll in-house can cut costs and deliver total control over payroll to your organization. Click one of the dates below to register.