By Jack Terrana
Some of you see your best activity during the summer months, while others in the staffing industry see a significant slowdown.
Late in the third and early in the fourth quarter seem to be busy regardless of market segment. And just like with spring cleaning at home, there comes a point in your business when you need to do a good clean-up.
It's a time to tidy-up and throw out what has not been used in order to gain space, or in the case of your staffing business, gain efficiency.
If you find that you have a lot of extra time on your hands - that your business does not demand too much of you- then you can stop reading now. But if you are like most business owners, then you are at work for 8-12 hours a day, only to come home and work for another 2-4 hours. Yes, those after-hours calls and emails do count! And you are not alone.
Each year in the staffing industry, the hours you work increase while the margin and profit you earn decrease.
The smart and successful staffing owners have figured out that financial mismanagement, unproductive employees and dated systems are their biggest handicap. They have also learned that once the decision is made to clean-up and trim the fat, they not only have more time to pursue new opportunities, but their employees are happier and their profits rise, too.
So where are you bogged down? Who or what is devouring your time for little or nothing in exchange?
You won't see a magic bullet - the culprits cloak themselves in surface efficiency. No, you can't see it, but you know it's there.
How do you evaluate your organization and clean-out your house? You know it needs to be done, so get started!
Dollars and Sense
This first tip may leave many of you scratching your heads. Perfect. To reach your destination, you need a road map. That road map is missing from many small staffing companies and success is virtually impossible without it. I am talking about financial statements.
Do you know exactly what your cash position is right now? Can you rattle off the critical metrics from 2007 or last week? If the answer is no, then you have work to do.
With my company, I am are fortunate to speak with staffing owners every day, and you would be amazed at how many don't know off-hand what their weekly or monthly sales are.
If you don't know what's coming in, you definitely don't know what's going out. Conversely, if you ask any entrepreneur you consider successful, the
y can tell you their numbers to within a couple of dollars.
Balance sheet, income statement, assets, liabilities... yuck, sounds scary. But if you graduated from the eighth grade and own a calculator, you have the ability to create workable financials. That's certainly better than using nothing more than the company checkbook and monthly bank statements.
You can either grasp it now or pass it on to someone else who may or may not be reliable or trustworthy. In the end, if you are unable to understand the money aspect of your business, you are probably sunk.
Similarly, financial modeling for the future is equally critical. Hazy goals yield hazy results. Know your business in terms of capital and you will mostly likely avoid financial ruin
Quality Resources = Quality Results
Second tip: be picky about your employees. It's no secret that employees are expensive, just ask Ford and GM. The producers are worth whatever they cost and the slackers are overpaid no matter how little they earn.
This clean-up is all about gaining efficiency; yes, the $10 per hour worker costs roughly $30,000 annually when all is said and done, but you pay for bad hires in so many other ways.
Employees take up space and use resources that you pay for. The bad ones can be a cancer in the office and influence other employees negatively.
It's funny how people in our business, alleged hiring experts, often don't practice what they are preaching to their own clients. Rather than finding a bargain, look for good value. There are no bargains when it comes to personnel, and that is typically truer in your staffing company than it is in the large organizations that are your customers.
The Technology Factor
Third, but certainly not least, invest in the best software you can afford. Again, like with your employees, don't look for a bargain.
Go for the platform that offers the best value. The industry is littered with staffing software providers all claiming to be the best.
Obviously, they can't all be the best, yet each has customers that will swear that it is. That proves that there are several good products out there, but the best ones will show you solutions that are affordable now and have the features you will need as you grow.
Some staffing software providers have programs that require no up-front charges and offer additional services like fully-integrated back-office processing and funding - an ideal scenario for new and small companies.