What 98% retention actually looks like year to year
The math gets boring. That's the point.
A 98% client retention rate is a number. The reason behind it is a model. Understanding the difference matters if you're trying to figure out whether a PEO is going to be around for you in year three the same way it was in year one.
Retention is a lagging indicator
By the time a client leaves, something went wrong six months ago. Retention numbers tell you about relationships that worked, and the absence of the friction that kills them. At SIDECAR HR, 98% retention over twelve years means clients who started with us in 2015 are still here. Not because switching is hard. Because the service gets better every year.
The compounding effect
The longer your HR partner knows your business, the better the work gets. In year one, they're learning your org chart, your pay cadence, your benefits philosophy. By year three, they're anticipating problems before you call. By year five, they know which manager causes compliance headaches and why. That institutional knowledge doesn't transfer to a new vendor without a cost.
What it looks like in practice
The conversations change. Early on, you're explaining context. Later, your named contact already has the context and you're having the conversation one level up: about strategy, about cost, about what's coming next year. That's what retention actually looks like. The call gets shorter. The advice gets better.
If you're evaluating a PEO, ask for retention data and ask how it's calculated. Revenue retention and client count retention are different numbers. The client count one is the honest one.
You call. We answer.
And if we're not the right fit, we'll tell you.