E-CHX, Inc.

About E-CHX: Payroll processing services.

Rank on Top 100: 36

Top Executive: Mr. Richard Aab

Employees: 78

Website: www.e-chx.com

We asked Richard Aab, Chairman and CEO, to talk about his business.

Question: Tell me briefly about your business.
Aab: Founded in Rochester in 2001, E-chx provides payroll services anytime, anywhere to over 6,000 clients throughout the U.S. and is one of the fastest growing companies in the payroll industry.

We furnish clients with paychecks, summaries, earning histories, and all payroll tax returns. We integrate with partners to provide Human Resource services, 401(k), Workers' Comp, Section 125, and more.

We have become one of the premier independent payroll companies in the USA over the last six years.

Question: Who are some of your competitors?
Aab: PAYCHEX , ADP, Ceridian, and many other local and regional payroll processors across the United States.

Question: What differentiates E-CHX, Inc. from its competitors?
Aab: Our number one differentiator in the marketplace is our payroll technology platform. E-chx has created an instantaneous solution through our proprietary software, Encore. It is flexible and extremely user-friendly versus the cumbersome input processes and batch processing done by many national and local payroll providers. Real-time processing and reporting gives the control to the client and our customers really love it. Also, our payroll specialists are given a lower number of clients to manage. It's a great way to build long-lasting relationships with our customers and ensure their needs are being met.

Question: What does it mean to your business to be on the Top 100?
Aab: It is wonderful recognition for the E-chx team that our hard work and determination to build and grow a successful company that is contributing to Rochester's business economy is succeeding.

Question: What additional services can the Rochester Business Alliance provide to help your business?
Aab: Keeping us informed on the changing business landscape in upstate New York would be helpful. The panel discussions and forums have been helpful. Let us know how we can participate and add value to the local economy.

Question: What would you like to see happen in our region, and in our state, to help businesses thrive?
Aab: The single largest challenge for New York State continues to be the extremely high cost of doing business, caused by the onerous tax structure in our state. We consistently rank at the top in terms of tax expense among the 50 states. This is true for all types of taxes: personal, sales, property, and business. Until we can reduce the burden on both businesses and individuals, it will become increasingly difficult for us to attract and grow new businesses, and to retain existing companies in our state. We are seeing this in particular in upstate New York with the steady decline in manufacturing jobs in our region, and a very low growth rate in new jobs. This in turn leads to declines in population growth and property values. We need to work with our elected officials to come up with solutions that will reduce the tax burdens which will lead to a healthier economy.

Also, we need to be aware of and proactively prevent legislative actions that create excessive employer liabilities inconsistent with other states, such as certain aspects of our Workers' Compensation law.

Question: What trends are you seeing among your customers in terms of preferences?
Aab: Our customers are starting to look for more of a "bundled" or full service approach to business services. 15 years ago payroll companies primarily just processed payroll, handled payroll taxes, and offered direct deposit. Now customers want to integrate their insurance, retirement plans, benefits, and human resources with their payroll.

Question: What are the biggest opportunities you see ahead, as well as the biggest challenges?
Aab: One big opportunity for E-chx is as our industry migrates into other related lines of business (insurance, retirement plans, human resources), we have the potential to increase our revenues by broadening our product lines and by finding other large, strategic referral source partners in these lines of business, that see the same vision for growth that we do.

Another big opportunity is given that we have grown significantly and proven that our platform is enormously scalable, we can provide private branding of payroll and related services to larger strategic partners and key affinity groups looking to bundle payroll in addition to their successful products.

Our biggest external challenge will be from increased competition as banks and other non traditional companies get into the payroll processing business.

Our biggest internal challenge is the same as any growing organization- continue to find talented, motivated, and loyal people who share the same passion for the business.