Ask any entrepreneur or senior-level manager who their most trusted financial advisor is and their answer almost invariably will be their CPA. After all, few other employees or vendors are as intimately knowledgeable about a business’s inner workings and true state. So, when seeking prospective new clients, savvy payroll service bureaus know that a referring CPA can be a godsend.
Because a CPA has the inside track on clients’ businesses and personally knows the owners, any lead for payroll or related services will certainly be considered “warm,” – and warm CPA referrals on average result in an 85 percent close rate. Plus, since successful referrals often bring mutual benefits, CPA firms increasingly are partnering with payroll providers for five primary reasons: Service expansion, competitive edge, additional revenue, improved customer service and limited liability.
- Service Expansion: The opportunity to effectively expand product offerings is, perhaps, the top driving force behind CPAs partnering with PSBs. This is particularly true for smaller accounting firms and those that continue to operate on outdated platforms or with older technology. Agreements with payroll providers who can bring to the table the latest solutions, particularly cloud-based technologies that offer 24/7 online payroll access, can significantly enhance a CPA’s suite of services. And PSBs boasting additional services including timekeeping, employee onboarding and development, benefits enrollment and Affordable Care Act compliance are in prime position to land potentially profitable CPA partnerships.
- Competitive Edge: More options means more money. It also means a higher likelihood of attracting new clients and maintaining those client relationships over the long term. That’s because utilizing a one-stop-shop for multiple solutions can help streamline any business’s outsourced operations and keep their costs affordable. Being that streamlined, multiple-solution provider makes a CPA firm a far more attractive choice than a series of one-off competitors and boosts retention rates.
- Additional Revenue: Partnering with payroll providers also can mean additional revenue streams for CPA firms. This can happen either via white-labeling your payroll and related products and services under their brand and having you fulfill orders, or simply by referring clients to your PBS for a commission. Many payroll providers prefer to license their white-labeled services to accounting firms because it maximizes profitability while minimizing the burden on resources. In such cases, the CPA is virtually selling the services for you, often allowing you to boost your business while only having to deal with a single point of contact.
- Improved Customer Service: While CPA firms are increasingly interested in offering payroll and related services, many are not well versed in actually providing those additional options. After all, nothing about payroll is one-size-fits-all. Savvy payroll providers know that solutions must be effectively and efficiently tailored for clients’ unique situations and needs, particularly as laws change, technology advances and younger generations of employees bring new expectations of employers, corporate cultures and access to information on their pay, benefits, etc.
- Limited Liability: Laws and regulations governing payroll, benefits and related issues vary from state to state and are impacted with legislative changes on both the state and federal levels. For CPAs, venturing into such unknown territory without in-depth and constantly up-to-date knowledge of these issues can prove troublesome, even catastrophic when mistakes are made. As a top-notch PSB, you can help CPAs confidently offer payroll and other services while you take on the burden of risk.
If you’re a payroll provider, utilizing back-office product and service suites offered by providers like Atlanta-based Apex HCM and developing relationships with CPA firms already serving the types of clients that you want to target can prove a highly effective two-punch hit to your competitors.
This Apex blog post guest authored by Rebecca Yinko, Managing Partner of Payroll Solutions in Madison, Wisconsin. Rebecca can be reached at email@example.com.