When starting up a new business, there are many things to consider. Hiring the right people, implementing the suitable infrastructure, and engaging the right clients are all priority. You need to scope out the competition you’ll be facing, and research the appropriate rules and regulations surrounding trading in the relevant industry. However, one crucial element is often forgotten – payroll.
As soon as you employ just one person, processing payroll automatically becomes a necessity for your business. If you’re starting up, implementing a payroll solution as soon as possible has tangible impacts on how your business will progress. Here’s why:
Trust is key to employee retention
Employee retention is an ongoing battle for many businesses. Research conducted by PwC found that Australia is falling way behind in the race to retain good talent. Out of 11 developed countries researched, Australia sat last with 23% of staff turnover experienced in a year. The Netherlands were the best performers, with only 4% annual turnover of staff. Employee retention is considered a key driver for business success. Each time a new employee needs to be hired, significant resources go into recruiting, onboarding, and training that new staff member. A high level of turnover therefore leads to increased overheads not experienced in businesses with high employee retention.
According to research by The Workforce Institute, payroll errors (late or incorrect wages) could be a large contributor to high employee turnover figures. Employees need to be paid correctly, and on time. The Workforce Institutes’ research found that 25% of employees consider seeking new employment after one payroll error is made. That figure jumps to 49% after a second error. Payroll errors are about more than just money. There is a trust between employer and employee – the employee will work hard, and the employer will correctly remunerate them for their efforts. When paying an employee incorrectly, or a week late, there is a break in that trust. Your employees have their own financial commitments to meet, and if they aren’t being paid the right wage on time, it’s unlikely they’ll stick around. If you’re starting up a business, and you’ve employed talented staff that you want to keep around, a payroll solution is a must!
You can ready more about payroll errors and employee retention here.
Time is money
Processing payroll when you aren’t an expert at taxation requirements or modern awards is very time consuming. The phrase ‘time is money’ is even more true for startups, and the time spent trying to figure out how much to pay your staff could be more constructively used connecting to new clients, or bettering your product.
Choosing a payroll solution for your startup
Payroll might not be as shiny and fun as landing a new client, or hiring an ace new team member. However, it’s mission critical to your startup. As soon as you begin thinking of starting up a business, you need to invest in a payroll solution. There are even software on the market that are complete HR solutions, saving your business even more time and money. If you would like to read more about choosing a payroll solution, read our guide here.
Roubler offers the complete payroll solution for all business sizes, including startups. Our award-compliant, accurate and efficient service is backed by advanced technology and over 10 years’ experience in the industry. Furthermore, Roubler offers the complete management package, including recruitment and onboarding tools, rostering, time and attendance, and payroll all in one application. Plus, Roubler is integrated with Xero so you can look after all your finances in the same place. If you want your startup to get ahead, get in contact today.