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To Hire or Not to Hire Professional Employer Organizations (PEOs)San Clemente Surf Startup Leverages Irvine HR Outsourcing Firm to Focus on Growth
Leaving the company he founded after 11 years, the highly acclaimed founder of Ezekiel Clothing thinks he just bottled lightning. His latest brainchild is Mada, an edgy, rock-inspired surf brand targeted at hip 13-25 year olds. Rock ‘n’ roll’s elite are bearing his threads – Tommy Lee of Motley Crue (and Pam Anderson, his x-wife and girlfriend) fame can be seen in tabloids and TV shows adorning the surf-company’s logo. With De La Pena's experience building brands and companies, he knows what it takes to get his brand to market. Yet with no one on staff to tackle critical employee management and HR functions, the entrepreneur is faced with a decision: does he add another headcount or does he turn to an employee management firm for help? Shopping for HR Outsourcing for an AnswerMuch like De La Pena, many entrepreneurs are exploring alternative methods to employee management. For a fraction of the cost, small businesses are finding refuge-and revelation in externalizing the burden of labor-along with the liability and hassle of being an employer. Although specific HR processes like payroll and recruiting have gained acceptance in previous years, today's over achievers are clamoring for one-stop-shop solutions. Like other business owners, Vince De La Pena needs simplicity. Professional Employer Organizations (PEO) TrendIn response to the need to focus on core business activities is the rise in Professional Employer Organizations, or PEO's that provide a soup-to-nuts approach to employee management. Supporting and assisting in critical HR functions like benefit administration, payroll, safety and workers compensation, and compliance issues, the PEO industry is seeing gains of approximately 20% per year according to the National Association of Professional Employer Organizations in Alexandria, Virginia. Although the average PEO client has 17, businesses with 100 to 150 employees can benefit even more through the replacement of unnecessary staff or vendors when engaging a PEO. Why Are Businesses Outsourcing HR?According to the U.S. Small Business Administration (SBA), between 1980 and 2000, the number of U.S. laws and regulations regarding employment policies and practices grew by about 60 percent, and the owner of a small or midsized business now spends up to a quarter of his or her time on employment-related paperwork. PEOs assume much of this burdensome responsibility and improve client compliance. Realizing the need to specialize in their areas of expertise, fast-growth executives are outsourcing at a rapid pace, and contributing to the rapid ascent of the $2.5 trillion dollar industry, according to HRO Today Magazine. They realize that a staff of experienced HR professionals who are the best in their field and the broad range of benefit plans and employee services can help get their organization to the next level. Faced with the decision. De La Pena added up the cost of managing his HR internally. The salary, employment taxes and benefits, workers' comp., resources and office space went beyond his budget. When he calculated the time, effort and cost to recruit someone who would really deliver to his growth expectations, his frustration led him to considering a PEO. Getting the support, systems and infrastructure of an HR company behind him provides him with the comfort level to focus on what he does best - making his fresh, hip brands like Ezekiel and Mada a household name. HR Outsourcing Provides Instant HR Infrastructure and Supervisor SupportAfter interviewing numerous firms and selecting Emplicity of Irvine, CA, Mada had online employee services, group medical, dental, vision and life insurance plans, direct deposit and 401(k). This helped to tip the scales when it came to attracting and retaining key design and marketing talent. Furthermore, the office staff gets a seasoned and non-biased HR Coach who reports to De La Pena on a part-time basis, to help him get up to speed with labor regulations and to advise him on day-to-day employee issues. When the time comes, this trusted business advisor will even terminate or coach employees on his behalf. Focusing on Building the Business While Outsourcing Human ResourcesGetting the expertise and infrastructure that are enjoyed by such industry peers as Quicksilver, Billabong and Hurley, Vince De La Pena can now begin to do what he does best. "I don't have the overhead and this alone makes my life easier. I can now focus on building my brand." With retail sales exceeding $3 million in their 2nd year, Mada is poised to make it big in the surf industry through the vigilant efforts of its talented design and marketing crew. . Hard work and intense focus landed Mada with and unprecedented two ‘Breakout Brand of the Year’ nominations two years in a row and ‘Men’s Apparel Brand of the Year’ by peer members at the Surf Industry Manufacturers' Association (SIMA). Is Human Resources Outsourcing Right For You?Finding the right human resources partner will simplify your operations, keep your labor expenses under check and ultimately make you more profitable and effective. Take our compatibility test and find out if Emplicity would be right for your company. |
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 7 Things
Other PEOs Won't Tell You
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