Do you dread tracking time cards, calculating taxes and deductions, and processing payments each pay period? You're not alone. Over thirty percent of small business owners struggle with managing payroll internally.
What’s the result?
A major time drain each month as you run payroll yourself—not to mention the risk of costly errors and penalties from missing tax deadlines or filing incorrect returns. The good news is you don't have to go it alone. Partnering with a local payroll provider can prevent these headaches.
This post will outline some advantages of partnering with a local payroll partner, three options to help you find the best payroll solution for your small business, and how to narrow down your best fit.
Local Payroll Services For Small Businesses: The Benefits
Keeping up with payroll, taxes, and compliance is challenging, especially for small businesses with limited resources. That’s why finding a payroll provider with expertise in these complex regulatory requirements can be a huge asset to your business.
The right local partner saves you time and resources thanks to their more extensive toolkit and experienced team. And though you are paying for their services, outsourcing an experienced team usually far outweighs the price of finding, vetting, hiring, and keeping an in-house payroll expert of your own (or working with a big box provider.)
Let’s now explore our list of the top three options you may consider for local payroll services for your small business.
3 Options for Payroll Services
Regarding payroll, you have many options beyond the big national names dominating the space. Considering local options uncovers capable payroll partners who can fully manage your payroll functions and provide the personalized guidance and support you need. Here are three types of payroll services to research in your own area:
1. Full-Service Payroll Companies
Full-service payroll companies handle the entire payroll process for you, from calculating paychecks and tax withholdings to filing payroll taxes and producing year-end tax documents. Searching for "payroll providers near me" can better connect you with local payroll services for small businesses that might offer key advantages big box providers can’t.
A few specific advantages include:
Local support and responsiveness
Local payroll providers offer personalized service and quick responses when needed. If an issue pops up with payroll or you have questions, you can easily call your rep or go into their office to promptly resolve your problem.
Larger national companies tend to offer slower and less individualized customer support — you’ll waste time stuck on endless phone hold waiting to have your questions addressed. Local providers also cultivate relationships within their community and are naturally more invested in keeping you happy as a part of it.
Tailored services that meet small business needs
Local payroll providers can also design their systems for smaller businesses and workforces. This approach lets them customize services to align closely with your unique needs and tighter budget. They shape their tools, reporting, and processes around your payroll volume and functionality instead of "one-size-fits-all" models made to accommodate multinational corporations down to mom-and-pop startups using the same technology.
Potentially lower costs than national companies
Focusing exclusively on local small businesses often lets payroll providers and local affiliates deliver more affordable rates and packages than large national payroll firms courting huge companies. Their pricing models factor in the modest payroll volumes of most small companies to keep rates reasonable for more limited budgets without sacrificing the quality of the service and support they provide.
If you’re considering a local provider, keep these questions in mind to vet your best pick:
- Do you offer an integrated timekeeping solution?
- How are payroll taxes paid? Do you file them on my behalf?
- What happens if there is a payroll issue?
- Is there a dedicated contact for my account?
- Can I log in online to access payroll reports?
- Is direct deposit free, or do you charge per transaction?
- Can my employees use multiple direct deposit lines to fund additional checking or savings accounts? Is there an additional cost?
Work with a Local Option: ConnectPay
At ConnectPay, we tailor our payroll service, software and pricing for small businesses. Our customized solutions let you work on your business, not in it, while we make sure payroll runs seamlessly in the background, month after month. Did you know we’ve got 12 ConnectPay branches around the country?
One ConnectPay customer shares,
“I’ve been with ConnectPay for 6 years, absolute top-notch service, all the Reps are more than happy to help, My Rep specifically goes above and beyond every week and checks in with me every week to run my payroll on time. She is a true professional and a pleasure to work with. My sales rep is also always available to answer questions, I highly recommend ConnectPay to anyone in need of payroll services.”
2. Accountant or Bookkeeping Firms
Many local accounting firms and professional bookkeepers offer local payroll services for small businesses, including tax preparation, financial reporting, and compliance support. These trusted advisors likely have a long track record managing finances for companies like yours.
Taking advantage of accountants or bookkeeping firms also delivers big-picture visibility that big-box processors lack since they’re likely focused on larger customers. These local pros have years of experience and insight into how payroll impacts balances, cash flow timing, tax liability, and more to spot potential issues or opportunities you might face.
3. DIY Payroll Software Providers
Are you considering taking payroll functions in-house? Most payroll software programs can integrate directly with popular small business accounting platforms you might already have, like QuickBooks or Patriot Payroll.
Upon first glance, DIY payroll tools can appear to be more cost-effective than an outsourced provider–butthese self-managed payroll tools have downsides, too. DIY payrollshifts the workload onto yourself, or your already-busy internal team. Running payroll on your own also requires some training and expertise to avoid costly mistakes.
If you have the bandwidth to (or can designate a team member to) handle tax calculations, deadlines, form revisions, compliance updates, and direct tax payments, make sure you know your specific state's payroll laws and filing deadlines to stay compliant. Do you have employees working in different states? Don’t forget to brush up on Nexus regulations.
Choosing the Right Local Payroll Provider
Selecting the right payroll service for your small business requires understanding your operations and resources. As you weigh your options, keep these key factors in mind:
Your Integration Needs
Do you use accounting software like QuickBooks or Xero that you want payroll to sync with? Are there any other systems you want to consolidate, like scheduling, time tracking, or HR services?
Syncing payroll with your existing platforms saves manual imports/exports time and ensures your data is accurate and consistent across finance functions. Automation and integrations are incredibly helpful, especially for small teams.
Your Team Size
While local providers effectively handle up to twenty employees, forecast how fast you want to grow and scale your team. The bigger your team, the more likely you’ll exceed a small vendor's capabilities. Building out infrastructure to support payroll across 50+ employees may mean you need to upgrade to an ADP or Paychex down the road. But it’s okay to start small if you’re just launching.
Your Ideal Service Model
DIY payroll software has advantages but can distract your small business teams from their core priorities. Full-service local payroll services for small businesses, like ConnectPay, offer a hands-off option but let you maintain insights and control over your payroll. No matter your choice, set your expectations for automation, customization, and reporting upfront. Then, make sure that the provider has the bandwidth to meet them.
Available Pricing and Plans
Vet each vendor's fees for core payroll activities and additional services like contractors, 401(k) plans, etc. Understanding the total cost helps small businesses narrow what fits budget realities.
Ask fellow small business owners in your community about their experiences with different vendors and options to uncover limitations or pitfalls from others in your same boat who are navigating similar payroll decisions. You can also look at online reviews and get references to guide your choice.
At the end of the day, choosing payroll technology is significant but also fluid—start where your small business is now and stay open to reevaluating as your needs evolve.
Getting the Most From Local Payroll Services for Small Businesses
Though all three of these options may be able to meet your needs as a payroll provider, why not enjoy the best of both worlds with advanced technology and local service and expertise?
At ConnectPay, our Connected Payroll model takes payroll off of your plate and puts you in touch with local experts for taxes, Workers’ Comp, and more, ensuring you have all the information and context you need to run payroll confidently each cycle.
Curious about what ConnectPay can do for your business? We can talk through your biggest payroll blockers and provide suggestions and solutions. And if it’s a match, we can start working together to make your payroll run like a dream. Schedule your free Payroll Tax and Compliance Review today.