The best part of the PEO product is the services they provide, allowing their clients more time, energy, and resources to focus on increasing the company's bottom line. PEO's give you access to a team of specialists who provide expertise in a number of areas, including payroll, workers compensation, human resources, and compliance, benefits, and risk management. Funding companies provide accounts receivable management and working capital to grow your company. Without this capital many small or mid size staffing companies would not be able to stay in business. Finding a PEO and a funding company who will work together provides the best of both worlds.
You can bring these two vital parts of your staffing business together when you partner with a PEO Broker who has relationships with both PEO & funding companies. This scenario also allows for both the PEO & funding partners to be more competitive when proposing rates. The increased comfort level of the PEO knowing that they will be paid promptly for services rendered by the funding company allows for them to give slightly better rates. Funding companies have an even greater ability to be competitive because the PEO is handling all of the traditional functions that a funding company aside from the funding of operating capital & accounts receivable management.
Headaches, Confusion & Hassles
Unfortunately today's business environment is littered with areas where the small or medium sized staffing owners get overwhelmed, some, but not all of these areas are listed below.
• Payroll Services
o Federal Deposits ( FICA,FUTA )
o Quarterly Reports ( 941 and SUTA )
o Audits o W-2s, W-3 Transmittal , 940 Report
• Worker's Compensation
o Claims Management
o OSHA Compliance
o Audits
• Funding Working Capital
o Cash flow Management
o Accounts Receivables Management
o Expense Control "Variable vs. Fixed"
• Unemployment Management
o Unemployment Hearings
o Claims Management
• Benefits
o Cafeteria & 401K
o Insurances Plans
o COBRA
The PEO & FUNDING Advantage
Professional staffing people know there are many types of staffing companies. The big advantage that some of the larger companies have is access to the resources associated with back office support. Large franchises charge fees and percentages of profits for providing funding, payroll processing, workers compensation, centralized compliances and HR with safety and risk management support. Medium and small independent owners spend many hours at great expense providing these back office services because they are not a part of a large organization. These are the headaches and hassles a PEO teamed with a funding company can help solve. PEO's & funders save time, and decrease cost associated with the non-revenue generating functions of the business. This in turn allows you to re-direct those resources towards revenue producing functions of the business.
Outsourcing and how to determine what can be outsourced in your business?
Let's begin by asking what makes each staffing company the same? Whether staffing medical personal, light Industrial workers or clerical employees all these business have the same core functions that must be done. This is where we find a list of departments and services that can be outsourced e.g. (payroll, workers compensation, and HR & risk management, and accounts receivables management) the next natural question is how does one find these types of companies? A PEO Broker who has relationships with both PEO's & funding companies will be able to bring all these services to a staffing company.
Where the PEO Broker Fit's
A PEO broker who serves the staffing industry, that also has experience working with funding companies, will be able to bring these invaluable partners together for your staffing company. First, realize that most PEO's will not be able to underwrite the temporary staffing industry because workers compensation carriers do not favor this type of business. However, there are some very good PEO's that have strong and reputable carriers that will provide workers compensation for the staffing industry. It is the job of the PEO broker to give needed guidance in order to achieve the most cost-effective solution that will satisfy all of the staffing company's needs. The PEO broker who knows and has relationships with multiple PEO's and funders can be a valuable asset in finding the right fit for your company. Just as a good insurance agent need not represent only a single company, PEO brokers should represent many PEO's & funders and work to identify the one that is right for your company's particular needs.
The Back Office Puzzle
The staffing industry has many companies that provide outsourcing services.
Finding two companies that work together and understand that the need's of their client comes first, can be what's missing in your back office. Talking with a PEO Broker is the next step to finding out if the combination of PEO & funding that is the missing piece to your back office puzzle.
Marty Gray is the President of Staff Brokers Inc. He can be contacted at 877-416-0668, or by email at marty@staffbroker. net, or visit www.staffbroker.net
