ADP Targets Small Business Clients through Android Payroll Platform

May 27th, 2011 by Trefis Team
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ADP (NASDAQ:ADP), a leading provider of human resource outsourcing and payroll services in the U.S., serves many large businesses and also caters to a sizeable number of small businesses (fewer than 50 employees).  The firm recently announced that its popular payroll management platform for small businesses, RUN Powered by ADP, is now also available for the Android smartphone operating platform. ADP’s competitors in this space include names like Paychex (NASDAQ:PAYX).

Added Mobility Likely to Boost Small Client Base

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The Android platform launch of RUN Powered by ADP follows the firm’s highly successful first mobile payroll app for the iPhone platform in October 2010. The firm also plans to offer RUN Powered by ADP on Blackberry devices in the near future.

According to a 2010 nationwide survey conducted by ADP Research Institute, small businesses are leading the trend toward increased mobility with the ability to schedule payroll runs on calendar, set up an appointment and run payroll on the day it is due. [1]

Trefis believes this push to mobile platforms will likely provide a boost to ADP’s sales to small business clients, which have taken a hit in the past few years due to the economic recession.

We currently expect the number of ADP’s small business payroll clients to increase from as estimated 380K in 2010 to about 440K by the end of our forecast period. However, a faster growth in the number of small business payroll clients to 550K-600K during this period, driven by ADP’s expansion to mobile platforms, would imply an upside of 3-4% to our $62.54 price estimate for ADP’s stock.

See our full analysis of ADP stock here

Notes:
  1. ADP Announces Availability of Payroll Platform on Android Smartphones, smallbiztrends.com [↩]