$86,000
Against the proposal on the table
Capped at 8%
Next year’s renewal
Bars are drawn against a 0–100% scale, so the length is the reduction itself rather than a comparison between engagements. Every figure here is stated in the text above.
The situation
A manufacturer of commercial-grade cleaning products, over a hundred employees, operating across twenty-one states, in the middle of acquiring one of its chief competitors — an acquisition that would double the size of the organization. The firm being acquired had used a PEO for years and had a good experience of it, which was a large part of why the model was on the table at all.
The company had been a payroll client of a national provider for years. When its insurance broker delivered a 20% medical renewal increase, that provider’s PEO division was introduced through the payroll relationship, and it moved quickly. By the time BRG heard about any of it, the client had been negotiating with them for two months and had given a verbal commitment to proceed.
The broker who asked us to look had held the relationship for thirty years, alongside an affiliated banking division. They were about to lose a thirty-year client to a competitor they could not match in the open market.
What we did
We had roughly two weeks, set by the medical renewal effective date rather than by anyone’s preference. That is not a timeline we would choose and we said so. What made it possible was that the work of knowing which providers can underwrite a multi-state manufacturer at this size had already been done — the fortnight was spent marketing the opportunity and normalising what came back, not learning the market from a standing start.
The outcome
Nearly $86,000 in overall savings against the proposal already on the table, with significant further savings on workers’ compensation insurance. The medical proposal came in 7% better than the national provider’s, and next year’s medical renewal was capped at no more than 8% — a term worth as much as the first-year number to a company about to double in size.
The alternative also carried human resources compliance support the company did not have, and a significant upgrade to its payroll platform with better reporting. The client’s own assessment was that the technology was the stronger of the two and would better support the growth ahead.
The part we would flag
A referral partner asked us to compete for a decision that had effectively been made, and we did, and it worked. It is worth being clear about what that means: a comparison run inside two weeks against a fully negotiated proposal is a narrower exercise than a proper market process, and the reason it produced a better answer is that the incumbent proposal had never been tested against anything. Most decisions of this size are made the same way — against one option, thoroughly negotiated, and never compared.
If this resembles your situation
A verbal commitment is not a contract, and a renewal date is not a deadline for choosing — it is a deadline for having something in force. If you are two months into negotiating with one provider and have never seen a second proposal, the cost of finding out is a fortnight and nothing else.
Published outcomes follow BRG’s confidentiality standard: industry category and outcome only. Fuller detail is shared in the live discussion. Related practice: PEO / ASO Advisory.
