Banks are synonymous with checking and savings accounts. Car dealerships are known for selling cars. Coffee shops brew coffee. I could go on and on about the places you can obviously go to get the products or services you need. However, sometimes you might not know where to turn for an extra product or service. These types of things are known as ancillary products or services, because they are considered add-ons, as opposed to the provider’s bread-and-butter product or service.
So, what about your payroll company? Now, are you now wondering if your payroll provider offers any ancillary products or services? If so, you’ve come to the right place. Here are some helpful things your payroll provider may do, giving you a one-shop-stop for many of your business needs.
What’s the point of ancillary products?
Before we get into the list of possible ancillary products, let’s look at the purpose of the ancillary product. Sometimes I wonder why certain companies veer away from their main product line. After all, we’ve heard people say, “A Jack of all trades is a master at none.”
Nevertheless, most companies don’t do only one thing nowadays. For example, when I go to my hair stylist, I understand why there is a plethora of the most amazing shampoos and conditioners. I know that since she put all that hard work into my hair, she wants to be sure to offer me products and brands she trusts to maintain my hair until my next visit. However, I’ve noticed that she also sells skincare products and perfumes. Why would a hair stylist also sell those types of products?
Well, quite simply, those products give her a way to earn extra revenue, outside her main service. Think of it as sweetening the pot. This is the reason why most companies offer ancillary products; it not only benefits them by bringing in more money, but it also benefits customers by offering a convenient option for things they would have purchased elsewhere.
What should my payroll provider offer?
So, the main service of your payroll provider should be processing your employees’ paychecks. Now, some might include the tax service in with that, and others might not. Here, you are probably wondering why you would use a payroll company to process payroll and not withhold and pay taxes. Believe it or not, payroll companies can and do process payroll for 1099 or subcontract workers, even though they don’t withhold taxes.
Still, why would a company want to spend money on a payroll company if they aren’t withholding taxes? The reason a company would choose this option is because paying 1099s can be time consuming and tedious. Imagine if you must pay 25 subcontractors each week. You not only need to calculate their pay, but you also need to keep a lot of check stock on hand and take the time to print the checks. Then, you must keep record of everyone you’ve paid. Alternatively, you could type in the check amount, hit submit, and your payroll provider could process the payment through direct deposit, or send checks to your location within a day or so.
So, as you can see, the baseline for a payroll company is making sure your employees, regardless of what type of workers you employ.
After that, some providers will include a suite of services, followed by their ancillary products or services. The suite of services that are included with your payroll processing can vary, depending on the provider. So, while these items might be included in the payroll fee you pay, others might charge a separate fee for opting into them.
What are some common ancillary products or services?
While the ancillary products and services a payroll company offers will vary, there are certain items that you will often see on the list. Usually, the tax management portion of payroll is included at no extra cost. The purpose of this service is to withhold and pay taxes, which helps reduce errors and minimize liability. Still, there are other products and services that may or may not be included for a fee.
Popular ancillary products or services include:
- Onboarding & New Hire Reporting – The onboarding service will give you everything you need to get a new employee up and running, while the new hire reporting provides employment information to government agencies.
- Custom Reporting – The suite of payroll reports will give you different views of your payroll and tax payments over the course of the past year.
- Human Resources – The HR features some companies offer will vary in robustness. Some will provide a basic library resource or database to provide answers, while others will give employers the ability to speak with an HR representative for support.
- Time Clock Management – This is a tool that gives employers a way to efficiently manage employees’ punches, track breaks, monitor overtime, and many other functions related to timekeeping.
Additional ancillary products or services include:
- Employee Self-Service – The employee self-service offering gives employees a way to keep track of their paystubs, and to update changes to address, direct deposit, and other important information.
- Labor Law Posters – The purpose of these posters is to help keep employer in compliance with labor laws, and to make the laws visible to employees.
- Workers Compensation – Instead of estimating the approximate amount for workers compensation premiums, services such as these provide a pay-as-you-go options so that you won’t have to pay a lump sum upfront, followed by an adjustment after the year.
- Garnishment Services – This gives employers the ability to easily pay garnishments to the appropriate agency, potentially helping prevent lawsuits.
Some employers even take things a step further by offering things like discount programs. These are the types of services that can set some providers apart from others.
Keep in mind, while these are common especially in the small business offerings, there might be additional products or services for those operating midsize or large businesses.
As you can see, your payroll provider does much more than you may realize. While some companies are good about telling you their offerings at the first meeting, others might roll these options out to you slowly. So, if you don’t think you are receiving all the services you need, don’t settle! It’s likely they offer more than just vanilla. Reach out to your provider to see if they have the products or services you need as ancillaries. Ask for the sprinkles and cherries on top, too! Finally, try to not to view them necessarily as a Jack of all trades, but rather a master at meeting your needs.