Whether you're a CPA looking to enhance client value beyond your financial expertise, or an insurance broker considering the broad implications of introducing a PEO to your clients, it’s important to understand the potential risks and benefits.
We’ve come up with a few essential questions that those interested in partnering with PEOs should have answered before making a final decision, including:
At the end, we’ll also discuss how partnering with a PEO can specifically benefit CPAs and brokers alike.
If you’re thinking about partnering with a PEO, it’s essential that you find one that matches your business goals and values. Here’s how to make sure you’re in alignment:
Look for PEOs that are accredited by recognized bodies like the Employer Services Assurance Corporation (ESAC) or those that meet the Internal Revenue Service's (IRS) certification requirements.
Such accreditation is a testament to the PEO's commitment to upholding high industry standards, financial stability, and reliability.
Evaluate the PEO's approach to client relationships. Look for case studies or testimonials that can illuminate their philosophy. Do they view client relationships as purely transactional, or do they prioritize meaningful collaboration?
Try to find out how the PEO works with its current partners as well. The best partnerships are those where the PEO acts as an extension of your services, offering expertise in areas such as HR, risk management, and compliance, thereby enabling you to focus on your core offerings.
Research the PEO's client satisfaction and retention track record. A high retention rate is often a reliable indicator of the PEO's ability to provide consistent value and support to its clients and partners.
Make sure the PEO has experience and a solid understanding of the specific challenges and regulations of your industry. This is particularly crucial for partners in sectors with complex compliance requirements, such as healthcare and finance.
Partnering with a PEO can significantly enhance your business's service offerings and provide a competitive edge in attracting and retaining clients.
Beyond payroll processing, a PEO offers a wide array of HR services, including but not limited to employee benefits administration, talent acquisition, and performance management.
This allows businesses to provide their clients with a one-stop solution for all their HR needs, enhancing client satisfaction and loyalty.
Whether it’s navigating workers' compensation, implementing effective employee development programs, or optimizing HR processes, an experienced PEO can provide tailored solutions for any company.
Further, PEO services are designed to be flexible, scaling up or down according to the client’s business lifecycle stages. This scalability ensures that clients receive the right level of support at every stage of their growth, from start-up to expansion and beyond.
PEOs can offer economies of scale that reduce costs related to HR, payroll administration, and employee benefits.
This cost efficiency can be passed on to clients, helping them optimize their financial resources and invest more in growth-oriented activities.
Through their risk management services, PEOs also help businesses and their clients mitigate risks associated with workplace accidents. A proactive approach to risk management can help improve satisfaction with insurance premium costs and the longevity of the relationship.
We’ve broken down some of the risks that come with not choosing the right PEO service.
You can avoid these pitfalls by doing your research to find a PEO partner who understands the value of long-term partnerships for mutual business success.
One of the primary concerns for brokers is the potential loss of direct control over client accounts. Traditional PEO models may seek to centralize client services under their umbrella, diminishing the broker's involvement and weakening their client relationships.
Some PEOs may offer a narrow range of insurance products or possess exclusive arrangements with certain carriers, potentially limiting clients' options and resulting in less competitive coverage terms.
PEO partnerships can introduce complex fee structures that may be difficult for clients to understand. Hidden fees or charges for ancillary services can lead to client dissatisfaction and strain the broker-client relationship.
CPAs and brokers can gain tremendous value through a PEO partnership, enabling them to extend their service offerings, enhance client relationships, and streamline operations.
However, understanding how to leverage these partnerships effectively is crucial for maximizing benefits and minimizing potential risks.
Partnering with a PEO can significantly amplify the value CPAs deliver, particularly in areas beyond their traditional expertise, including:
A key concern for brokers is the potential for PEOs to assume direct control over client services, including insurance policies. Choosing a PEO that values collaboration over competition is essential to avoiding this.
Brokers should seek PEOs that respect their ongoing client relationships and work to enhance, not replace, the services the broker offers.
A partnership with the right PEO can enable brokers to offer a more comprehensive suite of services to their clients. This includes access to competitive insurance products, advanced risk management strategies, and tailored HR solutions, strengthening the broker's role as a comprehensive solutions provider.
Understanding the key aspects of a PEO’s business philosophy, the value that PEOs can offer their partners, and the potential risks involved in forming a partnership with a PEO can give brokers, CPAs, and any other business thinking of partnering with a PEO a competitive advantage.
A PEO partnership with BBSI can elevate your service portfolio, enhance client satisfaction, and foster operational efficiencies that drive growth.
BBSI is committed to collaborative success, offering transparent and flexible solutions tailored to supporting our partners and their clients.
If you're seeking a PEO partnership that prioritizes mutual growth, transparent communication, and comprehensive support, contact BBSI today.