Payroll Service Business Plan, Marketing Plan, How To Guide, and Funding Directory
The Payroll Service Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Payroll Service business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.
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There are a number of complexities are associated with processing payroll. There are numerous federal, state, and municipal agencies that require ongoing reporting as it relates to companies that have individuals on their staff. These ongoing reporting obligations are extremely complicated and for many small businesses they lack the necessary resources to maintain someone on staff to manage these forms and filings on a monthly and quarterly basis. As such, payroll services can be a highly lucrative opportunity for an individual that has an extensive understanding of how these filings work and can provide them with the services they need on an ongoing basis. The startup costs that are associated with the new payroll service are usually minimal given that it is a highly skilled full charge keeper or CPA that is launching these types of operations. A payroll service can be started for as little as $10,000 all the way to $200,000 depending on the number of initial payroll agents that will be hired at the onset of operations. The gross margins generated from payroll services is typically around 90%. The underlying cost of goods sold usually has to deal with the numerous amount of paperwork that needs to be filed with government entities as well as provided to clients. There are also significant costs relating to printing payroll checks were managing direct deposits on behalf of employers and employees. One of the nice things about these businesses is that they are almost always able to remain profitable and cash flow positive in any economic climate given the strong demand among small and medium-size businesses for outsourced payroll services.
For most people, they will launch a payroll service using their own funds for a small working capital one credit. Provided that the owner is a full charge bookkeeper or CPA then most financial institutions will extend this line of credit with very little collateral required. Most of the time it is the credit score of the individual, that will determine whether or not a financial institution will provide this type of capital support for this type of business. Of course, a payroll service business plan is going to be required and this document needs to feature a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page that features information that is standard to the payroll services industry. This payroll services industry generates upwards of $10 billion per year employs about 200,000 people.
Within any business planning document, a full demographic profile of the types of businesses that are going to be targeted should be included as well. This includes over viewing the number of small businesses within the target market, medium-size companies, and large corporations. The most frequent users of payroll services are small businesses and medium-size companies. As it relates to what types of businesses we target an examination of annual revenues, annual estimated profits, number of employees on staff, industries operate within, and other relevant information should be included within the profile. This profile used in conjunction with the payroll services marketing plan. There are a number of localized market research firms that can assist an individual is part of the business planning analysis given that this information can be hard to come by. It should be noted that there are a number of online services can also provide this information directly to entrepreneurs as well.
Although it is not frequently done, many payroll service business plans will feature a manual focusing on the procedures and protocols that are used in conjunction with rendering services. Many financial contusions that are determining whether or not to extend credit to the second business do not request this type of information, but it can go a long way in showing that this is a well planned out business.
A payroll service marketing plan needs to be developed as well. For most, a proprietary website that showcases the operations of the business, biographies of key employees, preliminary pricing information, contact information, and hours of operation should be included as well. Many payroll service companies will also feature functionality on the website that allows individual its owners or managers of employees to sign-in to manually enter any type of new payroll information. This is quickly becoming commonplace within the industry and anyone looking to enter the payroll services field should potentially look to have a website developer that purport provide secure functionality so that individuals can review their accounts. The company’s website should be listed among all major search engines with a specific focus on Google, Yahoo, and Bing.
All this is a service business that targets other companies, a presence on social media is very important for payroll service. As many new entrepreneurs turned to social media groups to assist them with starting a new company, having a presence on platforms such as FaceBook, Twitter, Instagram, and Google+ can drastically boost the visibility of the business by providing the company with the opportunity to obtain new clients. This is especially true if the owner-operator is active with online communities that focus on small business development as well as startups. The cost associated with developing presence on social media are considered to be moderately low. It should be noted that there are a number of different services that can assist in entrepreneur with launching a presence on popular social media platforms.
Beyond this type of online marketing, flyers and sales literature showcasing the payroll services operations should be distributed to companies within a 50 mile radius of the business and central location. The return on investment for a print advertising campaign can be moderately high if it is done with a laser precision towards small businesses that have just started their operations. Many new companies failed to retain a payroll service company before they launch their operations and quickly find that this is something that is very much needed.
A payroll service SWOT analysis should be produced as well. As it relates to strengths, payroll services are only something that a handful of people understand how to properly do on an ongoing basis. As such, the demand for these services is tremendous and remain so even during times of economic recession. For weaknesses, there are a number of major corporations that provide these services to the business public. However, many smaller businesses and medium-size companies choose to work with a more local firm in order to provide a greater degree of face-to-face contact with the business owner. For opportunities, many payroll services have turned to administering 401(k)s as well as others with specialized programs that are funded through employee contributions. While there is a substantial expense in developing these types of services they can be highly lucrative for you and establish payroll company is looking to boost their revenue streams. For threats, there is always going to be the risk of automation as it relates to any business that is processing data. However, there are a myriad of laws that need to be addressed as relates to monthly filings, quarterly filings, yearly filings, and other information as it relates to providing employment. As such, while automation is a risk faced by all businesses there’s really very little that would impact the way that these companies do business over the next tend to 20 years.
A payroll service company can be an outstanding small business to run for an individual owner operator or a group of accountants and bookkeepers. These businesses are always able to remain profitable once they acquired their initial customer base and they are able to readily expand using economies of scale. They are expected to remain a popular company to own and operate over the next two decades.