When it comes to running a small business, every dollar counts. Most small business owners run their business on a tighter budget compared to the larger companies. Because of the tighter budget, it is even more important to maximize each dollar.
No matter the industry, running a business has a ton of moving parts. While some business tasks can be taken care of by the business owner and their employees, some of the other tasks may require more specific knowledge and skill.
Due to the high demands of running a business, many small business owners choose to outsource different components of their business. Depending on the nature of the business and the business owner, there are different levels of outsourcing.
For small business owners who are looking for a full-service outsourcing relationship, the Professional Employer Organization (PEO) model can be a great fit.
However, as with everything, there is not a one-size-fits-all approach to small business needs. Just as every small business is unique, the perfect package of business services for each small business is also very unique.
Understanding more about the business and the services that would aid in helping the business grow is key. Each of the following relationships can be a great solution for small business owners.
The deciding factor is dependent upon which services are the best fit for the needs the business owner wants to meet.
1) Insurance Broker – The role of an insurance broker is to assist business owners with finding the best insurance policy for their business. Brokers tend to work with multiple insurance providers. This helps the insurance broker find the most competitive offers for the business owner to choose from.
This option may be the best solution for your business if insurance is all you need. Insurance brokers do insurance. If that is what you need, this option would be worth looking into.
2) Administrative Services Only (ASO) Model – The ASO model allows small business owners to outsource their human resource administration, payroll processing, benefits administration and compliance regulation to a single third-party outsourcing company – the ASO.
The main difference between the ASO and PEO models is the co-employment relationship. With an ASO, there is no co-employment arrangement.
This option may be the best solution for your business if you are looking to outsource some administrative business tasks. The ASO model allows the business owner to choose the services that best fit their business needs. A reason why a business owner may choose the ASO model over the PEO model is the flexibility it offers with insurance carriers. With an ASO, business owners can shop around with multiple different insurance carriers because they are not tied to a master policy like with a PEO. If you prefer a particular insurance carrier but want to outsource some administrative tasks, the ASO model may be the answer.
3) Professional Employer Organization (PEO) – A PEO is an outsourced solution for payroll, human resources, benefits and compliance. The main difference between this model versus the ASO model is the co-employment relationship. Unlike the ASO model, the PEO operates around a co-employment relationship. The relationship is between the PEO, the small business owner and their employees.
A) The PEO becomes the employer of record for tax and benefit purposes. The role of the PEO is to keep the business compliant with laws and regulations.
B) The small business owner maintains the day-to-day control of decisions and operations. The employer is always the owner of the company; that never changes in the co-employment relationship.
C) The employees gain access to high quality benefits at a lower cost. This is an added benefit that is not always available to employees who are working at small and mid-sized businesses.
This option may be the best solution for your business if you are looking for an outsourced full-service business package. The PEO gives business owners access to a rich suite of benefits with high quality health insurance at an affordable price.
Doing business with a PEO allows small business owners and managers to dedicate more time to growing their business, knowing that the back office administrative tasks are being taken care of by the PEO.
Because PEOs work with a number of small business owners, they are able to harness the buying power of thousands of worksite employees – in turn, having the ability to offer more affordable health insurance rates.
As a Professional Employer Organization (PEO), we understand first hand that small business owners are unique. Along with running their businesses and helping them to grow, business owners need flexibility and choices.
At Focus OneSource, we allow our customers to strategically choose the services that best meet their needs. Depending on the business needs, we can act as the insurance broker, handle Administrative Services Only (ASO), or serve as a full-services PEO. With our a la carte service option, our customers can hand pick the services they need if one of the above models does not quite work.
Focus OneSource is unique, just like the business owners that we serve. Rather than only offering the PEO package, we adapted to the needs of the local businesses around us. We are a full-service PEO but can also serve as the broker of record, and everything in between.
We offer a rich suite of benefits that will satisfy the
needs of many small business owners. Our rich suite of benefits includes:
- Health Insurance
- Dental Insurance
- Vision Insurance
- Life Insurance
- Flexible Spending Accounts / Health Savings Accounts
- Long Term Disability / Short Term Disability
- 401(k) Retirement Savings Plans
- Employee Wellness Program
- Employee Assistance Program
- Payroll Administration
- Human Resource Consultation
- Benefits Administration
Focus OneSource is Iowa’s premier PEO for a reason. As the only locally domiciled PEO in the state, we understand our customers better than the competition. If you are considering outsourcing some business services but cannot decide which model would work best for you and your business, we encourage you to contact us. We would love to hear about your business and help find the best fit for you.
Marketing & Wellness Coordinator