You want to be able to do more for your employees but cash flow is always a consideration. Any small business providing or seeking to provide benefits is already sweating the costs of benefits packages if they have done any homework ahead of time. You can buy your own plans, go with an online HRIS solution, or go full-boat with a PEO. There are some well known brands out there in the PEO and Payroll space right now. Zenefits has become a huge success in the HRIS space. Does A PEO cost more than Zenefits?
The First Rule In Benefits Club: We Donât Talk About Cheap
Starting off the conversation with which one of these is cheaper is the wrong direction to go in. Cheap solutions end up costing an awful lot in the long run. We should all know this by now. Automatically assuming the most expensive is the best one is not a good way to go either.
The question is, âDoes the a PEO cost more than a solution like Zenefits?â The answer is, âDepends what you mean by cost.â If you are looking to compare monthly bills then the answer is quite simple. Itâs Zenefits. What you need to ask yourself is, âWhat do I need?â Letâs take a better look at that question instead.
Throw the word âcheapâ right out of your mind. The cheapest benefits are the ones your employees pay for themselves but that produces the least job satisfaction and worst employee retention out of all of your options. Not to mention, replacing all those people over and over again costs a heck of a lot more than a PEO and Zenefits combined. Did you know the average small business pays about 6 to 9 months salary to acquire a new employee? Â How many times would you like to do that this year? So, the âget your ownâ model doesnât work because as we can clearly see, itâs not cheap.
The next cheapest benefits option is buying your own policies and making a go of it on your own. Does a PEO cost more than just doing your own policy and HR management? Again, if you compare monthly bills then the answer is, âYes.â The true cost of DIY HR is the time it takes to do it yourself. The real expense begins in the gamble that you are actually doing it correctly, legally and for the benefit of your employees. Lots of small business owners find out the hard way that they werenât as good a job at playing HR Manager as they thought. Some of those scenarios come complete with lawsuits. Not a good outcome for trying to save some money.
Which PEO Costs More Than Other PEOs?
If the first PEO you looked into was interesting but you were turned off by the price tag, take heart; they are not all priced the same. A PEO cost is not a commodity, meaning they are not regulated or required to all charge you the same fees. In fact, different PEOs have different ways of charging you. If the one PEO cost quote you got sent you reeling, there is likely another PEO that is easier on your monthly budget and still provides much of the same things you were originally looking for. A PEO costs more than Zenefits because it does far and away much more than Zenefits has any plans of doing.
If you just want to take advantage of pre-negotiated employee benefits rates with an online tool to do some HR Management then by all means, give them a call. Plan on still doing your own payroll, payroll tax payments and every other HR function yourself though.
Comparing One PEO Cost Versus Other PEOs Costs
Now that weâve established that comparing a PEO cost to Zenefits is not a fair comparison, the question is, âWhat do you compare a PEO cost to?â Thatâs where your friendly neighborhood PEO broker, like PEO Spectrum comes in. Just like shopping for car insurance, your PEO broker will assess your needs and present to you the best 3 options for you to choose from. You trust your car insurance agent to get you the best policy for the best rate, right? You can trust PEO Spectrum to do the same for you. Just like your own insurance agent, PEO Spectrum doesnât charge you for their services either. Breathe easier, stay within your budget, and cut through all the red tape. Thatâs what a PEO broker can do for you.