THE OLD WAY of running a small business
Traditionally, many small business owners in Hawaii were struggling to keep up with all the paperwork a growing company requires. From payroll and administration to employee health and retirement benefits to workers' compensation insurance, state and federal compliance issues and even worker training - small business owners were spending countless hours managing their HR needs, which was getting in the way of scaling their companies.
THE NEW WAY of managing a successful small business
Now, many small businesses in Hawaii rely on a Professional Employer Organization (PEO) to help scale their businesses. PEOs manage HR, benefits, payroll, risk management and all other aspects of employee administration for small, midsize, and large businesses. Because of their large networks, PEOs purchase insurance and benefit plans with significant discounts, enabling small businesses to offer higher-quality healthcare and benefits options that attract and retain skilled employees.
PEOs allow many small to mid-size businesses in Hawaii to focus on growing their business. In fact, small businesses that use PEOs grow 7 to 9 percent faster, have 10 to 14 percent lower employee turnover, and are 50 percent less likely to go out of business. Instead of being bogged down with administrative work, business owners that outsource their HR efforts are able to focus their time, energy, and resources on generating revenue and growth.
PEOs could be the competitive advantage your small business is looking for - Below are three questions you should ask yourself to find out if partnering with one is the right choice for your business.
Are You Spending Too Much Time on Administrative Work?
Administrative tasks such as payroll, taxes, and workplace safety can be challenging and can drain your precious time and company’s resources. Furthermore, compliance errors - innocent or negligent - can create lots of unnecessary work for your organization.
This is where a PEO can step in. By managing the HR tasks that small to medium-sized businesses don’t have the resources or expertise to take care of in-house, a PEO allows you to focus on the big picture. If you find yourself drowning in paperwork, a PEO can help.
Are You Having Trouble Attracting and Retaining Your Best Employees?
As hiring and keeping talented employees becomes increasingly more difficult, many successful companies in Hawaii are strategically leveraging employee benefits as a recruitment and retention tool. By partnering with a PEO, small companies gain access to many resources typically found only at large companies, such as experienced and certified HR professionals to assist with:
- Compliance issues
- Health care plan selection
- Workers’ compensation claims
- Certified payroll and employment tax
- HR and safety compliance training
Another area that HR experts can help with is making positive shifts in company culture in order to keep employees happy.
“It’s important to always be aware of what’s going on, culturally, in your organization and also when you can benefit from changing. Places, people, things all change. If you’re stagnant, people won’t want to work there anymore.” - Dennis Brown, President of the Hawaii Chapter of Big Brothers Big Sisters
When an employee leaves, it costs your company 20% of their salary to replace them. That’s a cost many Hawaii businesses cannot afford. If your employee turnover is higher than you’d like, a PEO can help keep your best people around.
Are Your HR Needs Getting in the Way of Scaling Your Company?
Owning a business is tough; owning a business in Hawaii is tougher. You went into business to provide a product or service - to pursue your passion. As your business grows, so do the responsibilities and commitments that take you away from that focus. With complex employment and labor laws that are always changing, the federal Affordable Care Act and state PrePaid Healthcare Act, as well as our reliance on importing and exporting - your time and energy is better spent on strategic business pursuits than trying to keep up with regulations. A PEO can alleviate the pressure of HR tasks and help you get back to what you love doing.
Finding the Right PEO for your Business in Hawaii
If you find yourself nodding along with any of the above scenarios, outsourcing your HR department might be the best strategic move for your growing business. When it comes to hiring a PEO, it is extremely important to do your due diligence. We’ve pulled together the 10 most important questions to ask in selecting a partner for your HR needs. The PEO will be an extension of your company; you should treat the process as if you were hiring an executive for your company.
And we can help you get started. Contact us for a free consultation to determine if our team of experts can help your business grow. At the end of the day, small businesses that choose to partner with a local PEO find it is worth the time, cost savings, and most importantly, peace of mind.