Payroll services: Benefits of outsourcing administrative processes

For small businesses, outsourcing is assigning non-core, non-revenue-producing activities to specialists. It differs from contracting in that outsourcing is a strategic management tool that involves structuring an organization around what it does best, often described as “core competencies.” There are many processes that can be outsourced by a business, but services like payroll services and human resources (HR) administration are the most common. Why? Because not only do the companies that provide these outsourced services use leading technologies, they also bring exceptional experience and best practices that would not ordinarily be available to small businesses.

Aside from helping to alleviate hidden costs, outsourcing can be a flexible solution. Depending on the needs of your business, you can outsource as little or as much as you need to.

A Canadian payroll expert, Alon Kvil had this to say, “For most businesses, having staff that is dedicated to payroll is a money-burner. Focusing your finance team on something as time-consuming or tedious as payroll and time collection is under utilizing the talent within your organization. Focus those people on tax strategy, accounts receivable, financial planning, etc. and you will see a benefit that goes well beyond completing administrative tasks.”

Business focus
Outsourcing administrative processes gives you more time to focus on what your business does best – that means improved productivity. It also translates into more time and resources for strategic planning and growth, from streamlining your recruiting and hiring processes to improving your bottom line.

Because most outsourced payroll services are internet-based and hosted by the provider, they’re easy to use and don’t require expensive software programs or upgrades. Payroll data is protected by multiple levels of security and hosted off-site, which eliminates the need to constantly perform data backups and keeps you compliant with government legislation. By outsourcing, you can simply input or phone in employee hours, units or dollars, and your provider will take care of processing deductions and produce cheques or direct deposit.

Focus on employees
Attracting and retaining employees is becoming increasingly difficult, so HR plays a strategic role in the success of your business. Offloading tasks to a business administrative services provider so that you can focus on tomorrow’s needs – hiring and keeping the right people, and ensuring you can fill key roles from within your business.

Avoid ‘taxing’ headaches
Outsource providers are experts in calculating payroll and ensure that employment tax reports and end-of-year paperwork are submitted accurately and on time.

Assume compliance risks
Unless someone at your business keeps up to date with changing legislation and best practices, you could be at risk for costly compliance failures.

Seek expertise
In addition to handling processes on your behalf, an outsourcing partner gives you readily available experts who can leverage best practices, produce time savings and minimize the use of costly external resources.

Most businesses realize these benefits of outsourcing administrative tasks very shortly after implementation. By optimizing the expertise of an outsourced provider, you will see a significant increase in efficiency as well as a change in your organization’s way of thinking – from crossing items off a to-do list to developing strategies that grow your business exponentially.


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