Payroll service for startups

There are a few steps you need to take before your startup can begin hiring. One of the most important things you must attend to is setting up a payroll system.

So what is payroll? In general terms, payroll is the process of paying your employees. The term refers not only to the distribution of paychecks but also to processes like financial bookkeeping and calculating relevant payroll taxes. With a well-functioning payroll system in place, you can track employee hours, issue paychecks on time, and pay payroll taxes. A good payroll system will also help your startup stay in compliance with regulatory laws by making necessary deductions for things like Social Security and Medicare.

In this article, we’ll take a closer look at what payroll services are and how they can help your startup. Read on for a general overview of payroll services for startups or click on any of these links to skip to the section you’re most interested in:

How to set up payroll for a startup

If you’re not sure how to set up payroll, you’re not alone. Many first time employers and small business owners initially have no idea how to establish and operate a payroll system for their startup. Although it takes some time and effort to get a payroll system going, it’s not as difficult as you may think.

To get your small business payroll system up and running, you’ll have to take a few basic steps:

  1. Set a payroll schedule to determine how often you’ll pay employees (i.e. weekly, twice a month, or monthly).
  2. Provide new hires with Form W-4 to determine withholdings so you can deduct the proper amount of income tax from their paychecks.
  3. Stay on top of IRS deadlines to avoid penalties.
  4. Compile your employee payroll information and keep it for your records.
Graphic: The basics of setting up payroll

Why should you use a payroll service for your startup?

For most small business owners, the idea of running payroll themselves every pay period isn’t exactly exciting. That’s because running payroll can be a tedious and time-consuming process. Additionally, to run payroll the right way, you must possess knowledge of tax laws and regulations at the local, state, and federal levels.

Making payroll processing mistakes can have serious consequences, such as unnecessary fees and fines from the IRS. Additionally, if you pay your employees the incorrect amount or issue paychecks late, it can contribute to employee dissatisfaction. In fact, 24% of workers report that they’d begin searching for a new job after experiencing a single paycheck error.

Text: 24% of workers say they'd begin searching for a new job after experiencing a paycheck error.

As a small business owner, you have a few different payroll options to choose from. There are three main ways to handle payroll:

  • In-house: Either you, one of your employees, or an in-house bookkeeper is responsible for running payroll for the company.
  • Outsource: Payroll is handled by a third party, such as an independent contractor or accounting firm.
  • Payroll service: Payroll providers and payroll software can handle all of the basic aspects of payroll management for your company. Many payroll providers and accounting software programs also offer add-on services like time tracking, tax filing, and processing tax forms.

Many small businesses choose to use a payroll service because it’s a convenient and often affordable option. Using a payroll service can save time and money by streamlining the payroll process, which reduces the amount of time you spend running payroll and minimizes mistakes.

Full-service payroll programs also include a number of helpful features that make setting up and managing payroll a breeze. Some of the most common features include: – Read more

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How to automate workflows so you can focus on your business

If you’re wondering how to automate workflows, chances are good that you’re exhausted with your current approach to running your business.

Maybe your typical morning looks a little something like this: You have your sights set on tackling one of your biggest business priorities. Let’s say you’ll be ironing out the details of the new service you plan to offer.

But first, you get sucked into your inbox and respond to dozens of emails. Then you get saddled with some data entry. Next, you need to resolve a customer support issue that keeps coming up. Before you know it, it’s three in the afternoon and you haven’t even touched the strategy you wanted to hash out today.

Sound familiar? We thought so—and it’s proof of the value of workflow automation.

What is workflow automation?

Workflow automation is when you identify a repeatable pattern of tasks and then use technology so that business process can happen without you.

Automation sounds complex and intimidating, and a whopping 73% of U.S. adults fear that artificial intelligence will eliminate more jobs than it creates. However, automation doesn’t need to be complicated. Many automated workflows can be accomplished in two simple steps.

For example, imagine that someone fills out the contact form on your business website. An automated workflow could take that response and automatically create a task in your project management software.

See? That’s a simple business workflow, but it removed a manual step from your own plate.

The benefits of workflow automation (hint: you’ll save time)

Process automation is all about reducing the amount of repetitive, manual processes that you and your team are responsible for. In and of itself, that removes bottlenecks, streamlines your systems, and keeps work moving forward.

But that’s only the tip of the iceberg. Let’s look at some of the other big benefits of workflow automation.

1. Workflow automation saves time

You spend more time than you think on repetitive tasks that could be automated. In fact, the typical office worker spends one-third of the working year on these types of administrative responsibilities.

As a business owner, these types of time-consuming tasks cut into the hours you could invest in working on your business—rather than in it. Research from The Alternative Board found that business owners spend only about 32% of their time working on important business development activities.

Process automation will save time and eliminate inefficiencies, so you can spend less time on mundane tasks and more time growing your small business.

2. Workflow automation reduces human error

Automated workflows happen without you. You’ll set up templates and other business workflows so that manual tasks occur reliably without your input.

Not only does this free up time, but it also reduces the possibility of human error. After all, you aren’t perfect, and you know that little mistakes can lead to a whole bunch of headaches.

For example, imagine that a customer submitted a question via email. You forgot to pass it along to the right team member, so that customer has been sitting without an answer for days—or even weeks.

With an automated workflow, that email could’ve been automatically directed to the right person, who would’ve been notified that a response was needed.

3. Workflow automation ensures consistency

Related to the above, automation also makes your business processes more consistent. When you’ve set up the automation, it happens reliably again and again—the exact same way.

No more worrying that one member of your sales team logs an entry in an Excel spreadsheet one way, while another employee does it completely differently. By cutting humans and real-time input out of the equation, you ensure greater cohesion of your repetitive tasks.

4. Workflow automation improves your culture

Some grunt work is unavoidable, but if it’s making up the bulk of your employees’ responsibilities, they’re bound to become frustrated. They want to do more than take care of mundane and mindless tasks.

Automation frees up more of your employees’ time so they can focus on job responsibilities that adequately use their skills, passions, and creativity.

Not only does this improve company culture, it also helps your business thrive, because you’re getting the most out of each member of your staff.

The building blocks: 3 basic components of a workflow

Your eyes have been opened to the perks of workflow automation. But how do you get started with streamlining and systemizing your own business processes?

Let’s start with the basics of a workflow. As digital workplace Kissflow explains, the basic components of a workflow are:

  • Predefined steps: This is a predetermined sequence of tasks that makes up the workflow.
  • Stakeholders: These are the people who carry out the various tasks in the workflow. Note that, in some workflows, steps are completely automated and don’t need an assigned stakeholder.
  • Conditions: These are the rules of the workflow that explain when a certain step should be taken.

Here’s a simple example of a workflow using these three components. Maybe you’ve turned your attention to your human resources processes, and you’ve noticed that you’re frequently answering the same questions from job applicants.

You decide to implement the following automated workflow: When an interested candidate submits the job application form on your website, they automatically receive an FAQ-style email that thanks them for applying and provides answers and links to helpful resources.

Within that workflow, your predefined steps are:

  • An applicant submits the application form on the website.
  • The FAQ email is sent to the applicant.

This process will happen without human intervention, so there isn’t a stakeholder. The rule is that the FAQ email will be triggered by the receipt of the application. – Read more

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What is ERP and how does it work?

Enterprise resource planning (ERP) software gathers all of an organization’s business tools in one virtual room to facilitate workflow and solidarity between departments. An ERP system helps to improve business performance through a number of different functional modules such as finance, sales, manufacturing, supply chain management, and human resources.

According to Gartner, the Enterprise Resource Planning market grew 8.8% to a value of $38.8 billion in 2019. As businesses grow and find the need to improve efficiency while maintaining a certain quality of service, ERP software becomes an attractive option. However, ERP systems can be costly and complex, and it is not uncommon for businesses to struggle with adoption and thus experience negative business impacts.

For these reasons it’s important to understand what an ERP is, the features these systems offer, and the tradeoffs your organization can expect from adopting one.

What is an ERP system?

An ERP system is a type of software used to plan and manage a range of business processes and tasks. Looking back at the history of ERP, these systems have evolved from paper-based scheduling models to today’s multi-modular computer-based systems.

Early history of ERP

The first recognized ERP was the Economic Order Quantity (EOQ) designed by Ford W. Harris in 1913. The EOQ was an inventory review protocol intended to help companies reorder at the right time to reduce inventory management costs. While brilliant at the time of development, this model assumed that demand, ordering, and holding costs all remained constant. Of course, no such assumptions are possible in today’s business environment.

ERP vs. MRP

MRP stands for Material Requirements Planning. This was the next major development in the history of ERP, when toolmaker Black and Decker computerized Joseph Orlicky’s MRP model in 1964. MRP was used to calculate the material and components needed to manufacture products.

In 1983, Manufacturing Resource Planning, or MRP II, came into use. As an extension of the original material resource planning model, MRP II software integrates other business functions such as general accounting, cost control, machine capacity, raw materials procurement, and demand forecasting.

Finally, in the 1990s, Gartner coined the term Enterprise Resource Planning to indicate the next evolution of enterprise planning software. Gartner defines ERP as a suite of business applications that share a common process and data model, covering a broad range of operational end-to-end processes. – Read more

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