As an insurance broker, partnering with a Professional Employer Organization (PEO)
can be a tremendous value add to your product offerings, primarily with small and medium-sized businesses. However, knowing which prospects benefit most from a PEO solution can mean the difference between growing your book of business or spinning your wheels.
Here are five tips to help you identify the high-value clients who are an ideal fit for PEO.
1.Focus on Companies With 10-100 Full-Time Employees
PEO companies provide access to HR expertise without having to add headcount. These services are best utilized by companies with limited resources and time to allocate to HR services but are looking to provide their employees with Fortune 500-level benefits.
Though PEOs offer a huge range of services
– from HR support to payroll to group insurance savings to benefits plan development – companies with employees numbering in the hundreds often find greater value from a Human Resource Outsourcing (HRO)
solution and selecting a benefit plan from carriers directly or on the open market.
On the other hand, companies with ultra-small workforces (1-10 employees) may not be the best fit either. These organizations may find it possible to handle their own HR services without additional investment in a PEO partner.
2. Look for Leadership With a Growth-Oriented Mindset
Working with a PEO enables owners and managers to focus on growing their business – not get bogged down by administrative tasks. Many mid-size business owners have grown their business since its inception and may find it challenging to relinquish control.
It’s best to remind employers offloading time-consuming HR tasks to a PEO partner frees them up to focus on high-value activities
. Working with extremely experienced human resources professionals enables business owners to access increased efficiency while also protecting their organization against compliance violations.
Finally, they will remain the employer of record for all staff, will still make all HR-related decisions, and their organization name and logo will still appear on payroll checks. Employees will be aware there is a third-party involved in HR administration, but they will still fully report to their current employer.
3. Seek Out Companies Who Desire Top-Level Talent
Small and mid-sized companies are often at a disadvantage when it comes to recruiting top talent, especially in industries where it comes down to a war on office perks and benefit comparisons. A PEO helps small and mid-sized companies offer otherwise-unaffordable benefits packages
. PEO companies also help smaller companies develop creative benefits packages that appeal to the modern workforce
Many PEOs also offer recruiting services
with teams of recruitment specialists experienced in helping clients design, launch, and manage the recruitment process in order to find the top talent clients need.
4. Pressure Test Efficiency of Existing Processes
Many employers are unaware their current human resources processes are disorganized, incomplete, or non-existent. Ask for specifics regarding how the organization is set up to handle future growth plans, compliance violations, lawsuits, or employee conflicts. If the response is vague or ad hoc, this company is likely a good candidate to partner with a PEO.
Evaluate how the company keeps HR records. Still using spreadsheets, Word documents, or disparate digital file systems? PEOs use advanced HR software
to manage everything from employee offer letters to online training, benefits registration, handbooks, and more. By leveraging a PEO solution, companies gain access to state-of-the-art time-saving software without investing in or maintaining costly technology.
5. Make Potential Clients Aware of Compliance Pitfalls
Many organizations possess a limited sense of how compliance requirements
apply to their industry or location. PEO companies protect businesses against compliance violations by keeping current with regulatory changes and enacting rigorous human resources processes to shield the organization from liability in the event of a lawsuit or other dispute.
Compliance touches every aspect of an organization. Regulatory requirements vary by state and industry, so employers with locations in multiple states are especially susceptible to inadvertent oversights. Recruiting, onboarding, paid time off (PTO), sick leave, workplace safety, sensitivity training, handbook development, termination procedures, licensing requirements, and record-keeping are a few of the many ways regulators monitor compliance. In addition to following the rules, organizations must be able to provide documentation demonstrating their actions. PEOs cover all these areas and more.
Win New Business by Focusing on Clients Who Benefit Most from PEO
Identifying the right clients for PEO is essential to your future success as a broker. Not every company is the perfect candidate for PEO solutions, so focusing your time and energy on identifying the right clients should be central to your new business outreach. Remember, not all PEOs sell the same. When evaluating a potential partner, look for “broker-only” PEOs
. If not, you risk facing competition from your PEO partner, potentially jeopardizing your own contract with the client. Broker-only PEOs provide support and solutions that prioritize your relationship with your clients. Connecting suitable clients with a reputable broker-only PEO will strengthen your clients’ organizations while promoting your own long-term success.
Want to learn more about what Extensis can do for your clients? Contact us today to discuss.