Menu

All questions

How do Costs Compare between Peo and Aso for Small Businesses?

When comparing costs between a PEO and an ASO, the primary difference lies in the fee structure and the scope of services provided.

Professional Employer Organizations (PEOs) typically charge higher fees because they assume employer-of-record duties and handle full compliance and risk mitigation. Their fees generally range from 3% to 8% of total payroll, though some models may charge between 2% and 10%. Despite these higher service fees, PEOs can provide small businesses with significant savings of 15-25% on total HR expenses by offering access to premium employee benefits at lower group rates through economies of scale.

Administrative Services Organizations (ASOs) offer a lower-cost alternative by providing administrative support without the transfer of risk or co-employment status. ASO fees are usually service-only, often ranging from 1% to 3% of payroll. While ASOs have lower base fees and offer more flexibility, they do not provide the same level of risk sharing or benefit-pooling advantages as a PEO. Additionally, businesses using an ASO should be aware of possible variable pricing and potential hidden fees, such as implementation or termination charges.

Related FAQs

Book A Call
Securities are offered through Finalis Securities LLC, Member FINRA / SIPC. Zaidwood Capital LLC (dba Zaidwood Capital / Zaidwood) (“Zaidwood Capital”) is not a registered broker-dealer, and Finalis Securities LLC and Zaidwood Capital are separate, unaffiliated entities. Finalis Securities LLC, Office of Supervisory Jurisdiction is located at 450 Lexington Ave, New York, NY 10017, 800-962-0418.
Finalis Privacy Policy | Finalis Business Continuity Plan | FINRA BrokerCheck | Finalis Form Customer Relationship Summary (“Form CRS”)
‍https://www.zaidwoodcapital.com (the “Zaidwood Capital Website”) is a website operated by Zaidwood Capital. This website is for informational purposes only, is not an offer, solicitation, recommendation, or commitment for any transaction or to buy or sell any security or other financial product, and is not intended as investment advice or as a confirmation of any transaction. Products and services on this website may not be available for residents of certain jurisdictions. Please consult with a Finalis Securities’ registered representative regarding the product or service in question for further information. Investments involve risk and are not guaranteed to appreciate. Any market price, indicative value, estimate, view, opinion, data, or other information herein is not warranted as to completeness or accuracy, is subject to change without notice, and Zaidwood Capital along with Finalis Securities LLC accepts no liability for its use or to update it or keep it current.
Investing in private placements involves a high degree of risk. These investments may be illiquid, speculative, and subject to substantial restrictions on transferability. Investors may lose all or part of their investment and should only invest capital they can afford to lose. Prospective investors should conduct their own due diligence and consult with their legal, tax, and financial advisors prior to making any investment decision. For your reference, Finalis’ Form CRS describes the services that we provide, how we are compensated, and other important information about Finalis Securities LLC.
Disclaimer: Corporate logos do not represent endorsements.
‍
Copyright © 2026 Zaidwood Capital. All Rights Reserved.