Depending on your business concentration and the competition in your region or niche, your staffing firm’s margins can be very slim. But don’t feel locked into your current margins. Here are a few suggestions to help you increase those margins and improve your profitability.
Choose Your Customers Carefully.
In any business, there are clients who will try to squeeze the last drop of value from their vendors. Unfortunately, those who demand the deepest discounts are often the most difficult to please. Evaluate your client base and determine if your high-demand/low-margin customers are hurting your business, more than helping.
Change Your Business Mix.
It is clear that high-volume staffing, like light industrial, can provide a lot of revenue, but at what cost? The margins are low, turnover is high and it’s tough to differentiate yourself from the competition. That doesn’t mean you must eliminate this part of your business entirely though. Just mix it up a bit. If you’ve built trust with a local manufacturer by providing them with quality service and reliable workers, why not leverage that relationship to gain entry to other portions of their organization?
Ask for introductions to those who hire for other departments or functional areas. Recruiting a few skilled workers or mid-level managers can increase your overall profitability and extend your reach throughout the business.
Automate What You Can
One of the biggest margin drains is spending too much time on nonrevenue-driving activities. Without the right systems in place, your team is not as efficient as it could be. Scalable staffing software will allow your employees to enter and manage data in one place, allowing you to create reports to analyze where you are underperforming and losing margin. Automating activities can help you to increase your margin, productivity and profitability.
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At Avionté, we provide solutions for staffing firms that help you to operate more effectively and keep your operational costs down. Our comprehensive staffing software delivers integrated software systems that make it easier to drive growth, maximize profitability and streamline your administrative tasks, so that you can focus on your serving your customers. To learn more about the many benefits of Avionté staffing software, contact us today.