Payroll Service: A Buyer’s Guide

Payroll Services

Payroll is one of the most important aspects of running your business.

Are you using the most secure and cost-effective payroll solution? Is your payroll complying with all local, state, and federal tax codes? What are you missing by handling payroll services on your own?

The Basics

Businesses are required to follow federal, state, and local laws regarding payroll processes.

That means employers are responsible for a) withholding appropriate taxes such as social security, federal income tax, unemployment, disability, etc., b) depositing these taxes into proper accounts or taxing agencies, and c) filing returns. Do all the complexities of managing payroll create more headaches and hassle?

Payroll service providers are experts at what they do. They have extensive knowledge of payroll processes. They will manage your payroll with ease and efficiency, even customize services to meet your unique business needs. Pay your employees in full and on time, every time. Make the process of reporting and filing with government entities worry-free.

Focus on what you do best: growing your business.

Managing payroll on your own? There are self-service options available to make the process more convenient. You can find quality payroll software from HR technology vendors that offer customer support to make your payroll administration painless. Or look to online payroll services as they offer an extremely streamlined approach to payroll that you can personally manage.

Perhaps you want to completely outsource your payroll. Here the options are vast. From bookkeeper and certified public accountants (CPAs), to companies that focus solely on managing other business’s payrolls. The great thing about outsourcing is that many companies provide other business administration and HR services that are easily integrated with existing payroll services to quickly streamline operations.

Many businesses outsource at least some aspect of payroll and tax-related responsibilities to third-party payroll service providers. This helps assure filing deadlines and deposit requirements are met and greatly unifies business operations.

Remember, you, the employer, are ultimately responsible for the payment of income tax withholdings and employee and employer portions of social security and Medicare taxes. Only when employers use the services of a professional employer organization (PEO) are they relieved of their liability for tax withholdings.

How Do Payroll Services Work?

Whether you choose payroll software, online payroll services, or a comprehensive payroll service provider, all payroll services work the same way.

You provide the necessary payroll information. This can come in the form of entering data manually for payroll software or submitting employee information to a third-party payroll service.

A payroll service calculates how much your employees should be paid each pay period.

A payroll service files and pays payroll taxes for you. This includes withholding employee taxes, filing tax reports, and paying tax withholdings to the proper government agencies.

Basic Payroll Service Features

• Automated Tax Payments and Filings: Both payroll software and service providers will file federal and state taxes.
• Employee Payment: Several options for payroll distribution are available through a payroll provider.
• Tracking: Vacation time, sick days, and paid time-off (PTO) accruals can all be tracked. Keep up with voluntary deductions and wage garnishments as well.
• Reporting: New hire reporting and tax report filing.
• Customer Support: Both payroll software vendors and payroll service providers deliver varying levels of customer support to keep operations running smoothly.

Payment Distribution Options

• Direct Deposit: This is the easiest and safest way to pay employees. Payroll is distributed directly to each employee’s bank account of choice. Paystubs can be printed out or viewed online, depending on your service.
• Printed Checks On-Site: Checks and paystubs are printed by your business using pre-printed computer check forms.
• Third-Party Check Distribution: Checks from your account are printed by your payroll service provider and delivered to your place of business for pay day.
• Handwritten Checks: You always have the option to handwrite checks and manually keep track of paystubs.
• Payroll Cards: If employees do not have a bank account, electronic deposits can still be made with a payroll debit card. If this service interests you, ask your payroll service provider how to get started.

What do you need to get started with a payroll service?

Both payroll software and payroll service provides require basic information to get your new payroll system up and running. To ensure quick set-up and implementation of payroll services, make sure you have the following:

• Business name, address, and phone number
• Business bank account
• Employer Identification Number (EIN)
• Employee information such as their name, address, social security number, tax withholdings, and pay rate
• Information on your payroll cycle–weekly, monthly, bi-weekly
• Payroll history

Types

In-House

When you decide to handle payroll yourself, you are keeping it in-house. In-house payroll works for smaller business and those businesses whose payroll needs are straightforward (i.e., all employees have consistent work hours).

Managing a small number of employees means there is less data to track and maintain and therefore can be easily managed using payroll software. However, the employee responsible for the payroll system must stay up-to-date on employee laws, salary norms, tax deductions/filings, and more.

Self-Service Software

Using software to streamline and automate the payroll process is common among smaller business. Payroll software is typically purchased through a payroll and/or human resources technology vendor. Payroll software automatically calculates withholdings, processes direct deposits, and has some reporting capabilities. Many software services also provide employees with online access to account information.

Advantages:

• Confidential: Data is not shared outside your business.
• Easily Integrated: Easy to integrate with other accounting software, such as QuickBooks.
• Affordable: Payroll Software is the most cost-effective choice for small businesses and/or businesses with simple payroll structures.

Disadvantages:

• Less Efficient: The payroll administrator must constantly stay abreast of employee payment structure, federal, state and local tax law, etc.
• More Mistakes: Manual data entry can lead to mistakes.
• Limited Reporting: You are limited to the type of reporting the software provides.

Managed / Outsourced

Small business owners spend an average of eight hours a month performing payroll functions. That amounts to 12 days a year that could be spent generating sales, prospecting new business opportunities, improving products or services, or servicing customers.

When you decide to outsource your payroll, you are opting for managed payroll services. Simply put, you are outsourcing the work of payroll management to a third-party.

Managed payroll services can come in several different forms, from online services to comprehensive payroll service companies. Whichever type of managed payroll service you choose, outsourcing can save you time and money. They will alert you to payroll issues and quickly remedy them as they arise. A payroll service provider can easily make payroll tax adjustments on a per state, per employee basis.

In other words, a payroll service provider handles all the details of the payroll process. You retain access to your company’s information and keep track of all your employees’ payments and deductions and are able to access reporting via an online portal. The price for services is dependent on the level of service your business requires.

Advantages

• Cost Effective: Reduce headcount by eliminating a specialized payroll management position. Use staff more efficiently.
• Efficient: Save time, money, and hassles by outsourcing. Easily keeps you in compliance.
• Accurate: A third-party service assumes liability for calculation payroll taxes and payment of those taxes
• Customizable: Outsourcing payroll helps you find the precise service you need for your business.
• Customer Service: Payroll service providers work for you and are there to address questions and concerns as they arise. You don’t have to maintain records of employees or concerned with tax issues.
• Reporting: Easily generate a variety of payroll reports.

Disadvantages

Four Managed Payroll Service Options

• Less Control: You may have less control over payroll by choosing to outsource.
• Security: More security measures must be in place when outsourcing to keep employees’ information private and your business in compliance.
• Higher Cost: Outsourcing may cost more than keeping payroll in-house.

Online Payroll

Online payroll is also called web-based or cloud-based payroll services. No software is installed or maintained–everything is online. With an online service, you can manage payroll anywhere you have internet access. As your payroll needs become more complex, online services can accommodate.

You’ll be able to pay both full-time and part-time employees as well as contract and freelance workers. According to TopTenReviews, a major complaint of business owners is that keeping up with changing government regulations makes managing payroll difficult. Online payroll services update your system as changes occur, so you don’t need to worry about violating tax code.

According to Business Weekly, basic online services should include the following:

• Payroll Processing: An online service will automatically calculate how much employees are paid each pay period. Online services consider overtime, holiday pay, and taxes. Payments are distributed to employees by direct deposit or check.
• Payroll Taxes: Online services automatically withhold employee taxes, file reports, and pay withholdings to proper government agencies.
• New Hire Reporting: Many online services will report new hires to the government for you. This includes applying for Federal Employer Identification Numbers (FEIN) for new employees.
• Integrations: Online services are easily integrated with other payroll/administrative programs that you may already be using, including accounting software, time and attendance systems, and human resource software.
• Tracking: Manage PTO. Employers and employees can view how many vacation and sick hours they have earned or taken.
• On-Line/Mobile Access: Employers and employees have online access to payroll information. You can view pay stubs as well as review PTO and tax forms. Some service offer mobile apps for easy access.
• Reporting: Wage and labor reports can be generated to provide an assessment of business operations.

Advantages

• Easy to Use: Online payroll processing is simple. Enter employee hours and employees and taxes are paid electronically.
• Speed: View  and enter information quickly.
• Accuracy: Calculations are done for you, keeping mistakes to a minimum. If your payroll is set up correctly and hours are correctly entered, then calculations are accurate.
• Cost Effective: No need to hire a comprehensive payroll service or a dedicated in-house employee to handle payroll. Update payroll information online every pay period. This cuts labor costs and takes minimal time from other important business.
• Convenient: Manage payroll when you want, how you want. Information is always accessible.
• Customer Service: Ask questions via online chat, phone, or email.
• Customizable: Find what you need online. Choose payment options, process W2s, generate reports to assess your payroll process, or properly file new hire, worker’s compensation, and wage garnishment reports.
• Scalability: As your business grows, payroll data can be accessed for human resource services and ensures zero duplicate entries.
• No Contracts: Online payroll services generally require no contract. You pay for services on a month-to-month basis.

Disadvantages

• Security: Online payroll services are not the same. Choose a service with high level of security.
• Less Control: In-house payroll still offers the most control.
• Cost: Online services are typically more expensive than handing payroll in house.

Comprehensive Payroll Services/ASOs

Comprehensive payroll services are provided by either a) a full-service payroll provider focusing exclusively on payroll services, or b) an administrative services organization (ASO). Both types of providers offer an extremely high level of customer service. Both manage payroll and all the tax and insurance filings that go along with payroll.

A comprehensive service provider model appeals to small and mid-sized businesses (SMBs) that don’t have the bandwidth to keep up with constantly changing compliance rules and tax codes. This full-service model also appeals to larger companies that need additional resources for payroll.

Speaking directly to ASOs, they fall under a larger umbrella of Human Resource Outsourcing (HRO).  Not only do they offer comprehensive payroll services, but they also provide broader human resource management. ASOs supply businesses with comprehensive human resource management including risk/safety management, recruiting, creating an employee handbook, revising job descriptions, and training and development.

If you only need payroll services from an ASO, you pay only for payroll services. As you increase layers of service, your cost will increase. ASO fees are typically contract or retainer based for a set amount of time and will depend on the types of services you receive.

Hiring a comprehensive payroll service provides your business with a high level of interaction between you and your payroll specialist. You submit employee information via phone, fax, email, or online. The more you work with your service provider, the better they get to know your system and the faster and more efficient the payroll process becomes.

Standard services provided by a comprehensive payroll provider should include the following:

• Payroll Processing: Comprehensive payroll service providers handle employee wage calculations and paycheck distribution each pay period. Payments are distributed to employees by direct deposit or check.
• Payroll Taxes: Your ASO will accurately withhold taxes, file reports, and pay withholdings to proper government agencies on the local, state, and federal levels.
• New Hire Reporting: Your provider will report new hires to the government for you.
• Workers’ Compensation: Your payroll provider can handle distributing worker’s compensation through its payroll services.
• Wage Garnishment: Full-service payroll providers handle wage garnishment.
• Tracking: A full-service provider manages PTO and provides a way for both employers and employees to view how many vacation days and sick hours have been earned or taken.
• Online Access: Many comprehensive payroll services provide an online portal for your business to access payroll information such as pay stubs and tax forms.
• Reporting: Full-service providers generate wage and labor reports to provide you with a full assessment of business operations.

Advantages

• Easy Transition: If you are using another type of payroll service, a comprehensive payroll provider will handle your migrations from the old payroll system including setup of all employee data and prior payroll data.
• Personalized Service: Only a full-service payroll provider provides comprehensive implementation and training. Find a service that offers a dedicated representative that will work continually with your business.
• Compliance: Comprehensive payroll service providers are experts in their field. They are responsible for staying current on payroll rules and regulations at the federal, state, and local levels.
• Security: ASOs must guarantee a level of security and privacy to their client to maintain compliance.
• Increased Employee Satisfaction and Retention: With a streamlined and accessible payroll process, employees can find what they need, when they need it.
• Multi-State Calculations: If you have multi-state employees, your comprehensive payroll provider will handle the varying tax codes and deductions from each state.
• Year-End Filing: Your provider will handle end-of-year W-2 and 1099 filing with the state, IRS, and the Social Security Administration. Any tax payments and forms are prepared and filed on your behalf. Copies are retained for you records.
• Integration: Easy integration of your comprehensive payroll services with accounting software (such as QuickBooks) which minimizes data entry.

Disadvantages

• Expensive: Comprehensive payroll services are the most expensive level of payroll management due to the high level of service provide.
• Under Contract: An ASO will provide services and contractually obligate you to those paid services for a certain amount of time. Other types of payroll services, including some comprehensive service providers, will work with you on a month-to-month basis.

Professional employer organization (PEO)

A professional employer organization, or PEO, is a company that offers a service where an employer outsources payroll management and other human resource services. This type of service is also known as co-employment or joint employment. For tax and insurance purposes, the PEO becomes the “for your company’s employees. As the employee of record, a PEO operates as the employer for tax purposes, while employees perform work for their hiring company.

In other words, a professional employer organization assumes risk for your employees. It processes wages for your employees based on hourly, salaried, commissioned, or tipped pay. When you seek the services of a PEO, you continue to oversee your employees’ daily activities but paychecks are issued by the PEO.

PEOs charge a service fee for taking over all personnel functions including payroll processing and funding, tax deposits and filings, and employee contracts and paperwork. This fee is typically a percentage of the total gross payroll (anywhere from 3 to 15%). Again, a PEO offers many different administrative services. You pay for only what you need. So, if you only need payroll services, you only pay for payroll services.

A PEO can save your business time and money. It eliminates staff that would be used to manage payroll and reduces legal liabilities that your business may have concerning employees. A PEO model appeals to small and mid-sized businesses and companies with under 200 employees.

By choosing a PEO, you provide consistency to your employees when it comes to payroll services. You are better able to focus on your business when you let payroll experts handle payroll services.

Signing on with a PEO is simple. If you have all the necessary business information, most PEOs can start processing payroll within five to seven business days.

Standard services provided by a professional employer organization include the following:

• Payroll Processing: A PEO handles employee wage calculations and paycheck distribution each pay period. Employees are paid by the PEO who prepare and distribute paychecks as well.
• Payroll Taxes: A PEO files local, state, and federal government paperwork under their company name (W2s, W4s, FICA, and more) and makes payments to appropriate tax agencies.
• Payroll Data Maintenance: A PEO handles all data related record keeping such as documenting new hires, employee retention, audits, inquiries, and all data maintenance.
• New Hire Reporting: Your provider will report new hires to the government for you. This includes applying for Federal Employer Identification Numbers (FEIN) for new employees.
• Worker’s Compensation: Your payroll provider can handle distributing worker’s compensation through its payroll services.
• Wage Garnishment: Full-service payroll providers handle wage garnishment.
• Tracking: A PEO will keep track of PTO including sick leave and vacation time.
• Online/Mobile Access: PEOs offer employees accessibility via an online portal or mobile app. View paystubs, tax forms, and update information at any time.
• Reporting: Full-service providers can generate wage and labor reports to provide you with a full assessment of business operations.
• Multiple Pay Cycles: If your business pays different types of employees on different payroll schedules, a PEO will handle this as well. For example, contract labor may be on a different pay schedule than full-time employees.
• Additional PEO Services: You can add additional HR services at any time to your service plan. PEOs oversee time and attendance, insurance and benefit programs, workplace safety programs, customized employee handbooks, training, recruiting, best practices, and job description revisions.

Advantages

• Increased Efficiency: PEOs are experts at payroll services. They provide an efficient payroll process for your business.
• Customizable: Choose the one or several services that best suit your business needs. Drop or add services at any time.
• Scalable: A PEO can meet the needs of your growing business.
• Speed: PEOs offer fast, easy payroll processing solutions.
• Customer Service: PEOs want to retain their client base. They often provide a dedicated account representative that functions as your business’s exclusive point of contact when questions or concerns arise
• Compliance: Professional employer organizations are experts in their field. They have assumed responsibility for your employees and guarantee implementation and adherence of all payroll and tax regulations on the federal, state, and local levels.
• Security: PEOs guarantee a high level of security and privacy to retain clients and maintain compliance.
• Multi-State Calculations: If you have multi-state employees, a PEO will handle the varying tax codes and deductions from each state.
• Year-End Filing: No more worries about end-of-year filings. The PEO is the employee of record and therefore handles W-2 and 1099 filings with the state, IRS and Social Security Administration.

Disadvantages

• Expensive: Just like a comprehensive payroll provider, the cost will be higher due to a more personalized level of service.
• Under Contract: Since a PEO becomes the employee of record, they require a service contract that takes a percentage of your total gross payroll.
• Perceived Inaccessibility: Employees must contact a PEO representative if they have any payroll questions. It may make employees less comfortable asking question to a payroll person that is not in-house.

Bookkeepers and CPAs

Another option for payroll services is to hire a bookkeeper or CPA. In addition to providing accounting, tax filing, financial reporting, and audits, many bookkeepers/CPAs will also offer basic payroll services to their client base. An accountant will prepare your financial statements and help you review financial data to stay in compliance with local, state, and federal tax code.

However, you may be responsible for submitting tax documents, administering paychecks, and maintaining employee data. Not all accountants and bookkeepers are well versed with security regulations governing employee record privacy including hiring data, salary, and time-off.

Advantages

• Convenience: If you currently use a CPA or bookkeeper, they can easily assume your payroll management.
• Customer Service: You can have a good line of contact with a local bookkeeper/accountant. Meet face to face at a physical address discuss any questions or concerns.
• Affordable: A local accountant may charge a low rate for payroll services in order provide other business services.
• Control: You have more oversight when working with a local individual in your city.

Disadvantages

• Limited Services: You may end up handling some payroll administration since an accountant’s knowledge of payroll may be limited. Reporting and payroll data assessment may be limited.
• Security: Does your accountant know the compliance laws when it comes to employee privacy?

Options

Pricing

The cost of payroll services is highly varied. On the low-end, you have payroll software that offers a self-service approach to payroll management. On the high-end, you have comprehensive payroll services and PEOs.

These managed payroll services offer a higher level of service at a higher price point. Many payroll services offer a basic set of services at a base price. Services such as tax filing and paycheck delivery can increase costs, and add-ons like direct deposit typically incur a nominal per-check charge.

Payroll Software Pricing Models

Payroll software is your most affordable option when it comes to payroll services.

Purchase payroll software through a payroll/human resources software vendor to ensure customer support with implementation. Each payroll software vendor offers different payment options for the payroll software and support that goes with it.

Per employee, per month

This is the most popular pricing model for payroll software. You pay a monthly fee for each employee in your organization, whether they use the software or not. The cost per employee tends to go down as you increase the number of employees using the software. Note that some software vendors charge a one-time setup fee as well.

Price Range: $1-$10 per employee, per month

Per user, per month

In this model, you only incur a monthly fee for those that use the software, meaning the payroll administrators. Again, vendors may charge a one-time setup fee. You should seek clarification from the vendor as to if you are paying per user or per employee.

Price Range: $5-$20 per user, per month

One-time payment

This model requires paying upfront for payroll software. Pricing is based on the features you need. The more features you use, the more you pay. Larger companies tend to look to this model. One-time payment options also come with an annual support fee and many add-on features (for a price).

Price Range $500-$10,000

Other software payment options

You may see free or open source payroll software options but you may be on your own to figure out how to implement the system and guarantee security to employee data.

Managed Payroll Service Pricing

Base Price Model

Pricing is fairly standard when it comes to the various managed payroll services.

Businesses pay a flat fee per month or pay period. For example, a per pay period provider will charge you for services each time you run payroll, while a per month provider charges one fee per month no matter how many payrolls are run.

Online services, comprehensive payroll services, and bookkeeper and CPAs function under base price models. This flat fee or base fee ranges between $20 and $200 per month.

Pay per employee: On top of your base fee, you will incur a per employee charge that ranges between $1 and $10 per month.

Pay per check: On top of your base fee, you pay a per check fee as well. Check fees range from $1 to $2 per check.

Tiered Pricing: You may also hear the term tiered pricing, where different levels of service are offered at different price points, from basic to more advanced services. The more you buy, the less you pay either per employee or per check.

What’s included in the base fee?

• Paycheck processing
• Online access for employers and employees
• Direct deposit
• Basic tax filing

Which services may cost extra?

• Replacement Checks
• Year-End Tax Processing–W2 printing, mailing, and filings
• Extra Payroll (in a 5-week month)
• Dedicated Account Representative
• Insurance and Deductions
• Electronic Filing
• Employee Onboarding
• Multi-State Filings
• Paycheck Delivery
• Check Signing

Contract/Retainer Model

An administrative services organization (ASO) offers tiered pricing under a time specific contract. You establish your base price plus per employee or per check fee and agree to those fees contractually. The negotiated cost of services depends on the number of services you receive.

PEOs charge a service fee for taking over your payroll and HR operations in the form of a percentage of total gross payroll (anywhere from 3 to 15%).

Additional Services Related to Payroll

• Human Resource Management
• Workers’ Compensation
• Time and Attendance
• Benefit Management
• Insurance Deductions
• Time and Labor Management
• Benefits Administration
• Employee Handbooks
• ACA (Affordable Care Act) Reporting
• Background Checks

Expert Advice

What to Look for in a Payroll Service Provider

Qualifications: Find a licensed and bonded payroll service provider. This safeguards your business from liability if financial mismanagement occurs. Ask for references from clients and consult the Better Business Bureau. Do your research.

Price: Know what is included in a provider’s basic service. Base fees and a la carte service fees should be straightforward from the start. You should be able to easily view a service price menu to know exactly what you are paying for.

Customer Service: You want a good line of communication with your payroll provider. Make sure your provider is staffed with qualified professionals to aid you in the payroll process. Do they have dedicated representatives? Do they offer online customer service?

Efficiency: How quickly can they turn hours entered into paychecks? How quickly can mistakes be corrected and checks reissued?

Accessibility: You want an easy-to use-system where tracking and updating employee information is quick and user friendly.

Questions to Ask Payroll Service Providers

• What size businesses do you work with?
• How do you keep employee records secure?
• Do you provide a dedicated account representative?
• Do you handle electronic filing? Does this include W-2s at the end of the year?
• What about multi-state employee filings?
• Does your payroll system integrate with QuickBooks or similar software?
• How much does your service cost?
• How long does it take to set up service?

Questions a Payroll Service Provider Will Ask Your Business

• How often do you process payroll?
• How many employees do you have?
• Where are you located?
• What other accounting or banking systems/software are you currently using?

Payroll Mistakes to Avoid

A payroll service provider will ensure that you put proper processes in place to avoid the following payroll data mistakes.

Misclassification of Employees

More and more businesses are moving away from sole reliance on full-time employees. They are shifting to non-conventional hires such as independent contractors, consultants, freelancers, and part-time employees. This diversity in the workforce offers businesses ways to save on labor costs, reduce liability, and have more flexibility in hiring.

However, it’s important to understand how to classify these non-conventional employees. The misclassification of workers typically involves labeling a worker as an independent contractor rather than an employee.

Why is misclassification an issue? The Affordable Care Act requires companies provide quality and affordable health coverage to full-time employees. Enforcement comes in the form of verifying how your employees are classified. You must follow the guidelines set by the Internal Revenue Service (IRS). A payroll service will help you properly classify your non-conventional employees.

Withholding Mistakes

As an employer, you are responsible for collecting and remitting withholding taxes. How much you are required to pay in taxes and how much you are required to withhold from your are two key elements to avoiding withholding mistakes. If a withholding mistake is made, it can snowball and affect other payroll and tax processes. The best way to avoid payroll withholding mistakes is gaining knowledge of federal and state tax laws. A payroll service provider is knowledgeable about tax codes and can properly document withholdings to avoid penalty and stay in compliance.

Missing Tax Deadlines

Employers must adhere to a bi-weekly or monthly IRS deadline to deposit withholding taxes and state taxes. Additionally, employers are required to submit quarterly and annual returns that are filed via W2 forms.

Missing these deadlines can bring penalties between 5 and 12 % of what you owe.

Know when the deadlines are. Know what type of documents are required for each deadline.  And know how to properly submit your tax forms. A payroll service provider knows these tax deadlines and can help your business file on time.

Poor Record Keeping and Inadequate Backup

Record keeping and data backup go hand-in-hand.

Accurate record keeping is crucial to accurate payroll management. If records are in disarray, you may misclassify employees, make withholding mistakes, miss tax deadlines, and incur penalties. Keep your employee and payroll data up-to-date. A payroll service provide can implement processes to keep your records accurate.

You can keep your records organized and current with a backup process in place. Cloud-based storage of payroll and employee information, along with hard copy files in the office, guarantee that you can keep your business running and your payroll system working even if there is data fail.

Choose a Service Provider

You have all the information you need to make a solid decision on payroll services. Now what?

Choosing the right provider can seem like an overwhelming task. 360Connect simplifies the process. We connect you with reputable payroll service providers. They deliver free price quotes based on your company’s payroll service requirements. Let payroll service providers compete for your business so that you get the highest level of service at the best possible price.