If you’re self-employed or run your own small business, then the idea of managing payroll processes without the help of software might seem intimidating to you. However, there are some excellent payroll software programs that can make this process much easier than it otherwise would be. These programs can also help you save money on payroll taxes and help ensure that your workers are legally paid for all of their work. Read on to learn more about how to use payroll software to streamline your payroll processes so you never have to worry about them again!
5 Simple Steps to Navigate the Payroll Software Selection Process
Before you even consider picking up a piece of software, make sure your organization is ready. In order to ensure it’s a good fit, make sure you do your homework on these key questions: 1) What are our payroll needs? 2) What will be impacted by payroll software? 3) How much does it cost? 4) Which other options are out there and what features, such as generating clear paystub, do they offer that could be useful for us? 5) Have we considered alternatives or solutions that fall outside of a traditional software package? You’ll probably notice I only list five steps here, but don’t worry—just because I’ve kept it simple doesn’t mean I’ve made it easy.
1. Determine if you Need a Payroll System
Before you can determine if you need a payroll system, it’s important to understand what one does. A good place to start is by asking yourself these questions: Do I have more than one employee? Do they work remotely? Am I paid on an hourly basis? Or am I on salary? This will help you understand what features are available in different systems. For example, if your employees don’t work remotely or are salaried employees, you won’t need some of the capabilities of more advanced systems. If your company is fairly small—under 10 employees—and fairly straightforward, some basic programs might be just fine for your needs.
2. Evaluate your Needs
The first step in hiring payroll software is determining what you need your payroll system to do. You don’t have to spend thousands of dollars on a payroll program that does everything under the sun. Instead, take some time upfront to figure out what features are must-haves for your small business, and which are just nice-to-haves. For example, if you have employees in more than one state, you may need payroll compliance in every state where your company operates—but if not, it’s likely easier and cheaper to hire a bookkeeper who will be responsible for handling state taxes.
3. Compare similar Features among Similar Products
When you’re searching for payroll software, there are a few features that are fairly standard across all programs. Consider which features will make your life easier when it comes time to pay your employees. For example, some payroll systems automatically withhold taxes and other fees. Others let you store information about each employee (including bonuses, retirement accounts, contact information, and direct deposit instructions). Other options include online banking capabilities that help you pay your employees electronically in lieu of paper checks. Once you’ve figured out what you need in a payroll system, do some research on competing programs to see which one offers similar features at an affordable price. This way, you can ensure that your employees get paid regularly without breaking your budget or compromising their well-being.
4. Select a Vendor
You don’t need to go out and meet face-to-face with every vendor on your list. A call or two will help you narrow down your options quickly. Why spend an hour of your time chatting with five vendors if two are able to do what you need at a competitive price? After all, it’s not just about saving money—it’s about making things easier for yourself. That means reducing paperwork, streamlining processes, and cutting costs by automating tasks that might take up more time than they’re worth.
5. Conduct a Trial Run Before Hiring
Before you bring someone on as a full-time employee, consider hiring them part-time or as a contractor for a few months. The trial period will help you figure out if their personality and skills are right for your company culture. If it’s not, don’t hire them—and save yourself from wasting time and money on an employee who isn’t going to work out. You’ll also want to make sure that both your business and your new hire are making progress during their tryout period. This can be done by discussing goals at regular check-ins and setting weekly metrics you both expect to achieve over a six-month trial period.