Profiting From the Payroll Opportunity

Profiting From the Payroll Opportunity
Presented by Don Uhl
Accountant's Advanced Marketing Network
Contact Don at donuhl@afdcenter.com

Thursday, July 26, 2001

Visit the AccountingWEB Workshop Calendar for upcoming sessions.


Summary

The complete transcript of this workshop will be available here, Friday, July 27.

The Payroll Business is HOT. With all the constantly increasing complexities of payroll processing, an unbelievable number of small to medium sized businesses are now outsourcing payroll or will do so in the near future.

Aggressive payroll and outsourcing firms are exploiting this opportunity! As quoted in Forbes Magazine April 16, 2001, it is estimated that “integrated outsourcing” (of which payroll is a large part) will grow to a $15 billion business by 2005!

How Large is the Payroll Market and the Opportunity?

There are over 10 million businesses in America with 1 to 100 employees. The “Big Two” (Paychex & ADP) combined have only 700,000 to 800,000 of this available market. Let us assume that the rest of the payroll service companies have another 300,000 to 400,000 clients (which is tremendously high). This puts the market, that is currently using a payroll service, at around 1.5 million. These businesses are extremely vulnerable to changing especially if offered another choice... like a local professional accounting firm! That also leaves the 8.5 million businesses currently NOT using a service! What an opportunity!

There are also tremendous advantages that the payroll business has for practicing accountants. Bottom line Profits are over 100%, once breakeven is achieved. If a monthly business client also has their accounting firm do their payroll, the payroll processing is almost pure profit! Doing a client’s payroll also tremendously increases retention of that client. Additionally, for every $1000 of payroll business an accounting firm acquires, it directly increases the accounting business by $3000! Payroll turns out to be an amazing way to market accounting services and acquire higher fee clients!

The obvious question is “How can I profit from this opportunity and take advantage of this potential bonanza?” Don Uhl, Executive Director of the Accountant’s Advanced Marketing Network Association, has taken their successful system of marketing for entrepreneurial accounting firms and developed it into The “Value Builder” Payroll Marketing and Selling System. This system gives accounting firms a step by step system to profit from this payroll opportunity
The training objective of this system is to initially answer these 3 questions.

  1. How do I differentiate myself from all others in my market strategically so that I have an advantage in the market?

  2. How do I develop a plan of action to get in front of more potential payroll prospects on a consistent basis? Appointments in volume and with consistency!

  3. How can I make presentations to potential payroll prospects so that my services are perceived differently from all my competitors and I create a situation so that I do not have to sell only on price?

Workshop participatns learned how to take advantage of the hot payroll business!


July 26 workshop sponsored by Don Uhl & Associates, Inc.


Transcripts:

Session Moderator: Welcome everyone, and thank you for joining us today! I'm happy to introduce Don Uhl, who will be presenting a workshop on Profiting from the Payroll Opportunity. Don Uhl is the creator of the Value Builder Marketing and Selling System and the Executive Director of the Accountants Advanced Marketing Network. He has spent the last decade exclusively teaching and consulting with practicing accountants across the nation in helping them professionally and more effectively market and sell their services.

Don's career has come full circle from acquiring a BA in Education from Glassboro State College (NJ) in 1970 to spending years going on sales calls with business owners to developing his soft sell, value selling techniques and beginning in 1990, teaching his unique system to accounting professionals. In 1996 in his quest to provide continuous education and retraining in practice development, Don formed and now heads up the Accountant's Advanced Marketing Network, a nationwide group of actively marketing accounting firms. Don's specialty is training and teaching accountants and their marketing staffs his a step-by-step value selling system. His approach is that business people do not want to be sold but love to buy. The system allows business owners to buy what is of value to them rather than just selling and creates a situation where fees are rarely an issue and almost always completely differentiates his client's services from all others in the marketplace.

Five years ago Don discovered and recognized that the payroll business was an extremely lucrative opportunity for his clients and adapted his step-by-step system to take advantage of the payroll opportunity. Don's message is simple: There is no competition for an accounting firm offering live payroll and using his system. Bottom line, payroll is extremely profitable for the practicing accountant and leads to a multitude of other opportunities. Today's workshop is being sponsored by Don Uhl & Associates, Inc.

Thanks for joining us today, Don, and welcome!

Don Uhl: Welcome Everyone! It's a privilege to conduct a workshop on AccountingWEB the most exciting portal available to entrepreneurial accountants I thank the talented staff at ACCOUNTINGWEB for the opportunity to share with everyone the unbelievable possibilities that are available to accountants in payroll. Today I'm going to discuss what it takes to handsomely profit from payroll and more important how to market your other services thru payroll marketing. My organization is the only practice development firm in America that has developed a step-by-step system for payroll marketing and teaches and coaches accounting firms our proven system. I'm going to open by giving you some basics of the payroll opportunity. As I do, write down your questions or concerns you would like to have addressed.

Don Uhl: My rough estimates tell us that there are almost 10 million businesses in America with employees. The Big Two combined, only have approximately 700,000 - 800,000 of these potential clients. Lets assume that the rest of the total payroll services company's have another 300,000 - 400,000 clients, which is tremendously high. This puts the existing market at under 1.5 million businesses using payroll services!

That leaves 8.5 million potential payroll prospects!! Lets estimate that over the next 24 to 36 months that 15% of the remaining businesses, not currently using a service, decides to employ someone to do payroll for them. Bottom line: the current market doubles! The problems or obstacles in the way of you truly taking advantage of this opportunity is that:

With all the competition how do I separate myself from all others in my market so that I have an advantage in the market place? How do I create a situation so I do not have to sell only on price? How can I get in front of more potential payroll prospects on a consistent basis? (appointments in volume and with consistency).
How can I systematically acquire more new payroll clients without selling on price only?

Solve these problems and the market advantage and the profits that accompany it can be yours. Why Concentrate on Selling Payroll as a Stand-Alone Process?

Consistent increased cash flow. Payroll is work that can be delegated without the firm owner(s) or partner(s) having to do the work. Because of this the increased billings are limitless. Increased profitability - Stand-alone payroll clients create a 50% gross profit, however when payroll services are sold to existing monthly accounting clients, the payroll is almost PURE Profit. With the process of actively marketing payroll, your accounting firm will get in the doors of business you wouldn't have necessarily gotten into otherwise, plus these businesses will be larger and result in higher fees.

For every $1000 of payroll business coming into an accounting firm it will produce $3000 of accounting work. Thus payroll is an extremely effective way to market the rest of the firm's services. Thus payroll is an extremely effective way to market the rest of the firm's services. With all the competition how do I separate myself from all others in my market so that I have an advantage in the market place? Based on the facts of the mindset of the market, this dictates that if we present our services like all other payroll companies, then we are perceived like all others and become a commodity and a commodity is governed by price.

Additionally, if a business views a payroll service solely as an expense, this strengthens the motive for lower price. Unless your payroll service differentiates itself, then the battle for the available market becomes price driven. To have a better chance of capturing more of your market, the marketing and selling process must differentiate you from all others. Also, since people are reluctant to change, then the process of selling your payroll services must utilize certain techniques and methods to make businesses more susceptible to change.

  • Analyze -The Competition in the Market
  • The BIG TWO sell on name recognition and credibility.
  • The others sell on price.
  • Over one half of your competitors will give a price quote over the phone or by fax
  • Most of your competitors do not do face-to-face presentations.

This analysis tells us that in order to competitively differentiate you from others in the market do the following and you can dominate the market. Develop a payroll presentation that differentiates your service from all other services. Present ourselves as PAYROLL CONSULTANTS instead of sales people selling payroll services. Sell the benefits of your payroll service instead of the features and reports. How can I get in front of more potential payroll prospects on a consistent basis (appointments in volume and with consistency).

  • Recruit 1 or 2 inside marketers to make outbound phone calls to your marketplace!
  • Initial Presentation and Dialogue.

The call is designed to grab the suspect's attention by utilizing a pre-designed script with a set of dialogues for whatever the prospect says. We are producing 7 to 15 appointments per week for payroll only and the businesses have never had an accounting firm call before on payroll. Usually people say NO out of habit. Coming back with a preset dialogue brings their attention to why you are calling.

How can I systematically acquire more new payroll clients without selling on price only? This obviously after you have gotten multiple appointments. There is a system and a talent that is needed for this. Some of our inside marketers have been in the system for 2 to 4 years. Develop a set strategy for your face to face so that it concentrates on your unique payroll strategy. Present all these points of your strategy. Establish your firm's downplay position on price.

Offer all the other conveniences that everyone else does. PLUS Emphasize all throughout the payroll meeting all the value-added and unique services your firm offers based on what the prospect says is important to them during the probe.

  • Probe in these areas
  • Guidance Questions
  • Communication and Accessibility to Accountants
  • Your Firm vs. Nationwide Publicly Held Company
  • Talk about Value-Added service-Objective. Differentiate our unique payroll service from all our competition
  • Sell the benefits of value-added services
  • Develop a unique company story

Don Uhl: May I tell you how our unique payroll service works ___________ ? As an accounting firm as well as a payroll service, we don't take on any payroll client unless we believe we can help them with what they're trying to accomplish with their business. There are a lot of computer processing type companies that can print checks and reports. We're not interested in acquiring you as a payroll client unless we might be able to help you accomplish your payroll and business objectives. Also, as you are well aware, payroll is a very sensitive, and sometimes, a complicated factor in the health and profitability of your business. So I'd like for you to tell me a little about your business. This way I can really understand what you do here and how payroll might affect your business.

Then begin to probe to get them to tell you what kind of issues or problems they may have. I'm doing all the talking so let's get into specific questions you may have! Is anyone aggressively marketing payroll?

Jesse R Bisbal: Is tax impounding a feature to offer

Don Uhl: Yes because we must offer what the Big Two are doing. We just go way beyond what they do

Don Uhl: Hi Leisa do you market payroll?

Leisa Gill: Yes, we have a payroll outsourcing company as part of our firm.

Nannette Fretwell: In offering all the conveniences that the "others" do, this would seem to create a negative cash flow on any firm (in general) regarding EFTPS. What is your prospective on this benefit offered by the "BIG TWO"

Don Uhl: Does anyone have a payroll? What do you mean negative cash flow? Payroll should always be a positive cash flow at about $100/hr. We have some accountants that are using our system. What has been your experience with aggressively marketing payroll? I should say accountants that are on this workshop!

Roger Veal: The system that I saw put into place here in Dallas was payroll.

Jesse R Bisbal: The big two always impound the tax money before it is remitted; take their fee in advance, too; thus no "negative" cash flow

Nannette Fretwell: I guess my meaning/question comes down to the possibility of a client's own cash flow being under funded for the auto deductions for the tax payments. Do you recommend that they make their own EFTPS payments or that we have the payments withdrawn from their bank, deposited into ours with us being responsible for the payment? Is there a way around this for us as a firm? So you're saying that if the funds are not available, then service and payment of taxes will not happen?

Al Noll: If the client can't afford to have the taxes impounded at the check date, they have a business problem.

Don Uhl: Take it for them. It will totally eliminate any compliance problems and/or IRS notices. Plus it is expected since most of the market does it

Jesse R Bisbal: That's correct!

Al Noll: One of the big challenges with tax impounding is finding a bank that understands how it works. They all think they know, but few really know.

Don Uhl: Once you get the processing down to a science,(impounding etc.) the sky is the limit for an accounting firm doing payroll.

Al Noll: Don, What is the value of payroll as an asset vs accounting or tax?

Nannette Fretwell: Thank you Don, Jesse and Al.

Don Uhl: Who in this group is aggressively marketing payroll?

Al Noll: We are very aggressive. Looking to hire Salesperson # 2 & 3 within the next week.

Roger Veal: am I the only one marketing payroll

Leisa Gill: We market our payroll services on multi-levels, through the accounting firm, through our employee benefits group, through our other affiliates...you know cross-selling.

Don Uhl: Payroll not only adds about 30% to new monthly billings but also fuels the sales of added services. As I said before, for every $100 of payroll business brings in $3000 of accounting. This has been happening for 5 years. That's $1000 not $100!

Kent Beilharz: That $1000 to $3000 is in how big of a market place, population size

Al Noll: We just sold a payroll in Phila PA for $220, the Paychex price was $165.

Don Uhl: Al, How did you build value?

Al Noll: SERVICE

Jesse R Bisbal: Service sells more than price.

Leisa Gill: Yes, services does sell more than price, but are you telling them the same things the other guys are telling them on service? Don't the "other guys" promise service too? There must have been another factor.

Dennis: So we can sell payroll at a fee above the national companies if we stress Service

Don Uhl: Kent-Our smallest client is in a small town in Miss. and we have clients in LA. Location does not matter

Roger Veal: The other guys treat you like a number

Al Noll: The other guys promise service, but everyone knows they don't deliver.

Dennis: We can stress that we have accountants reviewing the payroll, the national companies rely on clerks and experience a high rate of employee turnover

Don Uhl: Leisa- If you looked at what you are as an accounting firm and them as a payroll-processing firm, who would you buy from . There is no comparison. For everyone-If you present your payroll services differently you will win the business more times.

Jesse R Bisbal: I usually said we have accountants on staff that will answer your questions in relation to a payroll inquiry

Al Noll: One of our new clients was at an industry meeting and everyone was saying they move from ADP to Paychex then back. Their biggest fear is trying a local company. Once you get over that it gets easier.

Leisa Gill: I am not questioning accounting vs payroll processing at all...just pointing out that the difference is more than "service". The difference is the total package - the reliability, credibility and confidence you put with a CPA firm over a processing company. That was my point!

Don Uhl: Leisa- That is the point! You got it! Bring that passion to the table and you'll win all the time!

Kent Beilharz: So are sales people or advertising the key?

Jesse R Bisbal: The fear is that they believe that "bigger" is always better. Most local payroll company do not advertise at all

Leisa Gill: We do...We have great success when we go up against these guys in our market.

Dennis: that is true most local accountants don't advertise either

Don Uhl: We teach accountants this unique approach and it is a step-by-step system. Anyone wanting more details is urged to contact us.

Dennis: how do I contact you

Don Uhl: Kent- Sales people is the key. You may be that salesperson or you may want to have one

Roger Veal: The best part of accountants vs ADP is that you are an accountant and people like to hear that

Kent Beilharz: Not at this time, Thanks.

Session Moderator: Don - thank you so much for an excellent workshop! and thanks to Don Uhl & Associates for sponsorship of this workshop!

Don Uhl: Thank you everyone and I hope you have a new prospective on payroll

Session Moderator: thank you all very much for joining us today!

Don Uhl: Are there any other comments or questions?

Session Moderator: Dennis - Don's e-mail is donuhl@afdcenter.com


Biography

Don Uhl is the creator of the “Value Builder Marketing and Selling System” and the Executive Director of the Accountant’s Advanced Marketing Network

Don’s Workshops and On Site Consulting cover:

  • Value Selling Step by Step
  • Setting up a Marketing Strategy of Differentiation
  • Recruiting, Hiring, Training Inside and Outside Marketing Staff
  • Building a Profitable Monthly Accounting Firm
  • Individual Training and Coaching of Marketing Staff
  • Increasing Referrals, Retention of Clients and Raising Fees
  • Cross-Selling Additional Services
  • Building a Payroll Only Department

Mr. Uhl has spent the last decade exclusively teaching and consulting with practicing accountants across the nation in helping them professionally and more effectively market and sell their services. Don’s career has come full circle from acquiring a BA in Education from Glassboro State College (NJ) in 1970 to spending years going on sales calls with business owners to developing his soft sell, value selling techniques and beginning in 1990, teaching his unique system to accounting professionals. In 1996 in his quest to provide continuous education and retraining in practice development, Don formed and now heads up the Accountant’s Advanced Marketing Network, a nationwide group of actively marketing accounting firms.

Don’s specialty is training and teaching accountants and their marketing staffs his a step-by-step value selling system. His approach is that business people do not want to be sold but love to buy. The system allows business owners to buy what is of value to them rather than just “selling” and creates a situation where fees are rarely an issue and almost always completely differentiates his client’s services from all others in the marketplace.

Five years ago Don discovered and recognized that the payroll business was an extremely lucrative opportunity for his clients and adapted his step-by-step system to take advantage of the payroll opportunity.

Don’s message is simple: There is no competition for an accounting firm offering live payroll and using his system. Bottom line, payroll is extremely profitable for the practicing accountant and leads to a multitude of other opportunities.

Don’s other specialty is recruiting, hiring, training, coaching and mentoring salespeople for the firms in the network. His organization helps manage and coach a sales force of 31 outside sales people for the firms within the network, which includes 5 “Payroll Only” salespeople, along with continual coaching and retraining of partners and owners.

Don is a regular speaker at accounting industry functions including multiple appearances at Creative Solutions Users Conferences, National Association of Small Business Accountants, various local AICPA board functions and other industry vendor conferences.

E-mail-donuhl@afdcenter.com
Website-www.afdcenter.com


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