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Generally, staffing firms are the answer for companies that need to fill essential positions.
Based on the employment needs of companies, the duration could be short-term, long-term or permanent. Often, they are required to fill the positions on a short notice. This requires a unique understanding by staffing firms who must meet the highs and lows employment demands.
Whether a company needs 200 workers for a short-term seasonal rush or an accountant on a long-term basis, staffing firms must find skilled workers. Companies have a workforce problem and staffing firms work diligently to provide a resolution.
Staffing Firm, Know Thy Customer
Staffing firms are keenly aware of the problems companies face that may lead to the need for their services.
Problem #1: Unable to Find Top Talent
Generally, staffing firms build a network of top-performing workers to respond to the call from companies unable to find the right employees. Some companies may choose to have several firms on speed-dial so that they can quickly access a pool of talent. Others might partner with only one firm that specializes in the type of skilled workers they need.
Problem #2: High Turnover
Hiring the wrong employees can be a costly, painful mistake. By nature, some industries experience high turnover of employees. Others simply have a hard time balancing the need to fill a vacancy with finding the right employee among thousands of resumes.
However, a staffing firm can screen quality resumes and present several dependable candidates. This frees the employer's time and energy to focus the business while the firm posts job advertisements and schedule interviews.
Problem #3: Need for Flexible Staff
During any given time of the year, a company might be either understaffed or overstaffed. Fluctuating demands need a flexible workforce and a staffing firm to address those needs. Using temporary employees can help with large projects, extended sick leaves and peak time coverage without having full-time employees on the payroll.
Employers can go from fixed to variable expenses by using temporary employees. Seasonal peaks are covered without the high dollar expense of overtime. Additionally, employers do not pay employee benefits such as health insurance and vacation time because temporary workers are employed by staffing firms.
Problem #4: Too Small for Full-Time HR Department
There are some staffing firms that offer HR outsourcing services for small companies that do not have a full-time HR department. Companies have more flexibility to hire HR expertise as needed for an extensive range of services such as payroll processing, compensation and benefits administration, and training.
Staffing Firms are Structured to Meet Demand
There are many advantages for companies that hire staffing firms to meet workforce demand.
Borrowing Against Receivables to Meet the Demand
Generally, staffing firms earn money to continue meet employment demands by charging fees based on the structure of the firms. Executive staffing firms, for example, conduct talent searches and charge employers for the services. Most staffing firms offer temporary, temp-to-permanent and direct hire services. The amount is usually deducted from the fee employers pay, minus the rate that temporary employees receive.
Regardless to the type of structure, there are times when demand may exceed the operating capital of staffing firms. When this happens, staffing firms can make sure they can answer the call – literally – by financing their receivables through a Factoring Staffing Company.
Fast growth and slow working capital can have a negative impact on the ability of staffing firms to meet workforce demands. The addition of new accounts or satisfying requests from existing employers can stall growth while waiting for invoice payments. Weekly invoicing can still take more than 30 days before payment is received.
Based on monthly sales volume, staffing firms can have quick access to cash for the holiday staffing recruitment event. This will close cash flow gaps and make sure employers do not call a competitor for staffing needs. Generally, financing accounts receivable allows staffing firms to prevent bad debt experiences with employers who do not honor invoices. They can also conveniently access their account online.
This is a win-win situation for staffing firms since their reputation rests on understanding employer needs and answering the call. With accounts receivable loans, they never have to make a choice between having sufficient capital and supplying top talent.