Every business is good at one thing. Hershey’s makes really good chocolate. The Warriors are superb at basketball. Boeing makes reliable airplanes….well, maybe not Boeing, but you get the idea. Every business specializes in what they do.
Most businesses do not specialize in payroll, onboarding, and the other administrative tasks that go into recruiting and hiring. These types of tasks are costly in two ways. First, they take management time away from producing the good or service the company specializes in. Second, hiring is amongst the most costly things a business can do. According to SHRM, it costs companies about $4,200 to hire a single person!
Many businesses incur this cost because they want to hire the right person, and this is something we completely support. A good hire needs the right hard and soft skills to succeed. What many business don’t realize is that almost 50% of all new hires do not work out! This is crazy. Here is some math:
You are responsible to hire, on average, 50 warehouse workers per year. Your company is pretty efficient at hiring, so your cost is $3,500 per person. Over the course of a year, your company will spend $87,500 each year hiring, onboarding, and training employees that will not last. This does not account for the management time spent reviewing resumes, doing background checks, and so on.
So what can you do? One option is to consider using BOLT (or a company like us) as a payroll service provider. Here is how it works:
- You decide who to hire
- You send them to BOLT. From there, BOLT does the following:
- Background check
- Skills testing
- ACA compliance
- Reference checks
- Sick pay tracking
After a certain period of time, when you know the employee is going to work out, you can convert them over to your payroll. It’s that easy.
Payroll services are not for everybody, but if your company is experiencing high costs dealing with employee turnover and HR administration, it could be something to consider!