Spoiler alert: It’s payroll services. You might not think of it as your firm’s bread and butter (that title might already belong to advising or tax planning), but payroll can be pretty lucrative—if you play your cards right.
Although manual payroll has long been a snafu for accounting professionals, leading some to steer clear of it altogether, cloud payroll software changed the game. With it, you don’t have to spend precious time scouring the internet for annual changes to federal, state, and local payroll tax rates and laws; filing and depositing taxes; and generating reports.
Payroll software does it all for you (thank you, technology).
So in today’s day and age, you can’t ignore the cash cow that is payroll services any longer. Here are three scary things that could happen if you fail to pay attention to it:
- You could miss out on a lucrative service
- Your competitors who do offer payroll could come for your clients
- You could lose out on attracting clients looking for payroll services
Benefits of offering payroll services
If you haven’t thought seriously about offering payroll services, now’s the perfect time to start. After all, it’s hard to pass up profitability, marketability, and the ability to stay competitive.
Take a closer look at the three big benefits of adding payroll services to your firm’s repertoire.
1. Profitability
Turn a profit in your sleep, they say. It’ll be fun, they say. In this case, “they’d” be right—well, sort of. If you use software, offering payroll services is both profitable and requires minimal effort.
With payroll software, you don’t need to worry about manually running payroll for your clients or updating tax law and rate changes (cloud payroll updates are automatic). And if you want to avoid tax filings and remittance, just hand the responsibility over to a trusted payroll partner.
To maximize payroll service profitability, team up with a payroll software provider. The provider bills you for the software. Then, you can charge your clients a premium for handling their payroll. And if your payroll provider partner gives you special pricing (which they will, if you partner with the right one!), cha-ching. You’re on your way to profiting in your sleep.
2. Marketability
“I have enough clients,” said no accountant ever.
There are millions of businesses in the U.S. that have to do payroll. And sure, they may need accounting, budgeting, or tax planning advice too, but their main focus may be payroll. So if you want to attract new clients, you may want to start offering payroll services.
Through payroll services, you can attract a new demographic of clients, then upsell your other services to them—and vice versa. You may even be able to expand your services out of your locality or state since you can run payroll online.
3. Ability to stay competitive
Thousands of accounting professionals are offering payroll services. Do they know something you don’t? Yes, yes they do. They know that payroll is a valuable service that appears more time-consuming than it actually is.
Current or potential clients are looking for payroll services. Your competitors offer them and you don’t. Should they stay with you, or should they go to them? In some cases, you could miss out on or lose clients to competitors who offer a broader range of services than your firm.
And since payroll is such a hot commodity, it could be the missing link your practice needs to source and retain clients.
Not to mention, offering payroll services can help you become your clients’ trusted advisor in all areas of business, which could lead to increased brand loyalty (not today, competitors trying to poach your clients).
Getting started in the realm of payroll
Intrigued? Use these three steps on how to offer payroll services to get started:
- Look for a payroll partner
- Come up with your pricing structure
- Put a little oomph into your marketing
Look for a payroll partner: Unless you have tons of time on your hands, you can work smarter by partnering with a payroll software provider. Find a payroll partner who’s reliable and reputable with strong user reviews. You may also want to find a partner whose software is cost-effective and chock-full of time-saving features.
Come up with your pricing structure: Charge too little for your payroll services and your profit margin shrinks or disappears. On the flip side, charging too much for payroll services could send clients running. Come up with a balanced pricing strategy that takes into account the price of software, plus the work and time you put into managing payroll on your clients’ behalf. Look for a Payroll Partner who offers special pricing to their partners to maximize your profitability.
Put a little oomph into your marketing: Partnered with a payroll software provider? Check. Settled on your pricing structure? Check. Your next move in making your new revenue source work for you is informing people that it exists. You can let current and potential clients know about your new payroll services through email marketing, social media marketing, direct mail marketing, taking out some ads, and updating your website. Your payroll software provider may even have free marketing materials you can download and distribute to your clients.
Looking for more? Take our downloadable guide with you
If you’re just discovering the benefits of offering payroll to your current and potential clients, you may have more questions.
Over at Patriot Software, we created a downloadable PDF, “An Accountant’s Guide to Offering Payroll Services to Clients.” In it, we cover the benefits of offering payroll in more depth, what to look for in a payroll provider partner, and how to market payroll services to your accounting clients.
The best part? It’s free (cue the applause!) and available for download here.
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Tags: Benefits, Payroll, Technology
