About Paychex, Inc.
Paychex began as a payroll processing firm, but has since expanded to offer a variety of human resources-related services. The company provides payroll services through its SurePayroll online application, while its Paychex Flex platform integrates payroll processing with HR management, employee benefits administration, time tracking, and employee performance management. Paychex processes the payrolls of more than 680,000 clients, making it the second-largest payroll accounting firm in the US after Automatic Data Processing. The company focuses on small and mid-sized businesses and serves clients throughout the US and Europe.
Paychex organizes its operations into two main segments. Its Management Solutions includes payroll processing and other HR services and products, and accounts for about 75% of revenue. Its Professional Employer Organization (PEO) and Insurance Services are grouped together and account for most of the remaining revenue.
PEO operations offer clients a combined package of services that includes payroll, employer compliance, HR and employee benefits administration, risk management outsourcing, and the on-site availability of a professional HR representatives. Paychex serves as a co-employer of its PEO clients' employees and takes care of administrative duties so clients can focus on their core operations.
The company also attributes a small share of revenue (less than 5%) to interest earned from funds held for clients.
The Rochester, New York-based Paychex has offices throughout the US. It also has European branches and sales locations in Germany and Denmark, and a location in India for information technology staffing.
Sales and Marketing
Paychex markets and sells its services primarily through its direct sales force based in metropolitan markets. Sales representatives are supported by marketing, advertising, public relations, trade shows, and telemarketing programs. The company also solicits new client referrals through relationships with existing clients, certified public accountants, and banks. About 50% of its new payroll clients come from these sources.
Paychex has enjoyed year-over-year growth in revenue and profits over the past several fiscal years, experiencing strong momentum in its human resource solutions administrative services and solid sales performance in professional employer organization, retirement, and insurance services.
In fiscal 2020 total revenue increased 7% to $4.0 billion. Oasis contributed approximately 4% to the growth in total revenue.
Net income increased 6% to $1.1 billion on higher revenue. Paychex reported increasing expenses in 2020, especially from higher PEO insurance costs.
The company had $905.2 million in cash and cash equivalents at the end of fiscal year 2020. Cash from operations was $1.4 billion, while investing activities provided $771.9 million. Financing activities used $1.4 billion.
Paychex intend to strengthen and extend its position as a leading provider through continued investments in both our technology and service offerings. Key elements of our strategy include:
Providing industry-leading, integrated technology. Paychex continue to invest significantly in its award-winning Paychex Flex platform and mobility applications to increase efficiency and functionality for ots clients and their employees.
Increasing client satisfaction. Its flexible service model and technology-enabled service allows Paychex to provide a personalized service experience for its clients and their employees. Paychex continue to invest in artificial intelligence and machine learning and self-service capabilities to allow clients and their employees easy, intuitive, and flexible service how, when, and where they want it.
Expanding its leadership in HR. Paychex have a comprehensive suite of value-added HR Solutions for its clients and their employees. Greater than half of its revenues are from HR and benefits solutions beyond payroll. After several strategic PEO acquisitions over the past several years, Paychex are now the second largest provider of PEO services in the nation. With over 600 HR business partners, it have extensive expertise that believe sets them apart in the industry.
Growing its client base. The company believe there is significant potential to grow within its current target markets. Paychex have invested significantly in new demand generation and sales tools and expanding certain areas of its sales force. We continue to focus on sales productivity with the intent of expanding its market share across all its product lines.
Engaging in strategic acquisitions. In the past, Paychex utilized acquisitions as a mean to expand its portfolio, enter new markets or increase its scale. Paychex continue to evaluate and monitor potential acquisitions and will utilize this when the acquisitions are in alignment with its overall strategy.
Before founding Paychex in 1971, Thomas Golisano worked in a payroll accounting company that solicited the business of large firms. After discovering that 98% of all US businesses had 200 or fewer employees, he started his own company to cater to small business needs.
Several friends started branches in other cities, and by 1979 the enterprise had grown to 17 locations, some company-owned, some joint ventures, and some franchised. Golisano began consolidating Paychex, buying out his partners and friends. In 1983 the company went public. (In 1994, 1998, and 2002 Golisano made unsuccessful bids for the New York governorship.)
911 Panorama Trl S
Rochester, NY 14625-2396
Phone: 1 (585) 385-6666
Employer Type: Publicly Owned
Stock Symbol: PAYX
Stock Exchange: , NASDAQ
Chairman: B. Thomas Golisano
President and CEO: Martin Mucci
SVP, CFO, and Treasurer: Efrain Rivera
Employees (This Location): 900
Employees (All Locations): 15,800
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