One of the skills needed to run a successful staffing agency is knowing how to find and get profitable clients. The Canadian staffing market is very competitive. Many temporary employment agencies are often chasing the same contracts. To succeed, you must know where to find these opportunities – and how to get them.
In this article, we discuss 12 ways to find and get a temporary staffing contract.
Note: If you are just starting an agency, you can also read “How to Start a Staffing Agency”.
Why are you better than competitors?
Before looking for clients, you must first determine why they should buy from you. Bottom line: Why and how are you different? And better?
A common answer to this question is to say that “you provide great service.” Unfortunately, that won’t cut it. Not only does everybody say that, but it is expected as part of your service. The market weeds out those companies that don’t offer good services. You have to do better.
Maybe you provide better employees? Or have better training programs? Or access to a large pool of staffers? You must get your sales proposition well defined before looking for clients.
How to get clients and contracts
Due to the competitive nature of the industry, getting a contract requires effort and dedication. You must be good at identifying your target clients, their needs, matching their needs to your value proposition, and, ultimately, making the sale. Here are 12 points to help you find and retain clients.
1. Become an expert in your niche market
Your goal should be to become an expert at fulfilling the staffing needs of the industry you are serving. This objective takes time, but building a great reputation is the best long-term strategy to get clients. All other strategies for getting clients work better if your company achieves expertise in your target industry.
Learn everything you can about the needs of clients in your industry. Examples include:
- What skills are in high demand?
- What skills are in short supply?
- Where do they usually look for candidates?
- Are they affected by seasonality? If so, how?
- How are they affected by economic downturns and upturns?
Building this expertise allows you to forecast your clients’ needs and serve them better. This level of expertise will motivate clients to contact your agency whenever they have staffing needs.
2. Identify your ideal target clients
Identify your target clients before you start looking to place staff with them. In general, the industry is divided into three purchasing segments. Clients can be “volume buyers,” “boutique buyers,” and “everyone else.”
Volume buyers are large companies that have large staffing needs. In principle, getting a “volume buyer” sounds great. However, they usually shop for the lowest price. Can you price your services low enough to beat a large national competitor? And, even if you could price low enough, do you really want to?
Boutique buyers are companies that need temporary hires with very specific talents. These buyers are very sensitive to quality. The wrong staffer could have a large impact on the business. More importantly, boutique buyers are less sensitive to price and can provide solid margins.
Lastly, there is everyone else. This category is a catchall for everyone who is not a boutique buyer or a large buyer.
3. Gather referrals
Referrals are the best way to build any business. These can come from clients or from hires. They provide valuable information, insight, and can help you make inroads with new buyers.
Unfortunately, referrals are hard to come by – especially if you are just starting and don’t have a solid track record. Consider putting a referral system in place. However, don’t expect it to produce early on.
4. Ramp up networking
For many agencies, networking is where they get the most clients. Like referrals, networking takes time and effort to work. Unless you have prior experience in the industry, you are not likely to see results quickly. However, you should always consider networking, as it is a good way to slowly build a reliable pipeline.
5. Attend trade shows
Trade shows can be a great place to meet potential clients. After all, you get everyone in your target industry in one place. The problem is that for many small agencies, a national trade show might be overkill. They can be expensive to attend, once you factor in travel and accommodations. Things get even more expensive if you want to get a booth.
Local trade shows, on the other hand, can be very useful. They are often moderately priced and provide good value.
6. Frequent industry associations
Industry associations in your target industry can be a great resource to grow the business. Many associations have local chapters which meet regularly. These meetings can be a great place to meet potential customers and get sales meetings.
7. Visit LinkedIn often
Most recruiters use LinkedIn to find employees (it’s saturated, by the way). LinkedIn can be a valuable resource to find clients. The simple approach is to search for clients and contact them via the messaging function.
However, LinkedIn serves a much better purpose as an intelligence-gathering tool. Use it to learn the background of the executives you want to connect with. Their profiles, likes, or posts give you clues about their latest projects. These projects are opportunities that may need staffing resources.
Here is an important tip. Do not contact a prospect or a company without doing proper research. Nothing is more off-putting to an executive than getting a pitch from a person that did not bother to do a little basic research.
8. Consider cold calling
Everyone hates cold calling. Executives hate receiving calls. Salespeople hate making calls. Most calls result in hang-ups or no-goes – except those that don’t and eventually lead to sales. For better or worse, cold calling works well for some companies.
Cold calling is relatively cheap. All you need is a phone line. You can build a client list using a combination of Google and LinkedIn. When done correctly, cold calling is a good (albeit hard) way to build up clientele.
9. Be transparent about your fees
Always be transparent about cost and fees. Nothing kills a relationship faster than hidden (surprise) fees.
10. Develop a proper follow-up process
It’s very likely that you may contact a prospective client at a time when they don’t need your services. Develop a system to communicate with prospective clients regularly. Mix up your communication style/venue so that follow-ups don’t become boring. For example, follow up with a call the first time. Use an email for the second time. Meet for coffee for the third time, and so on.
11. Not every client is a good one
Not all clients are good. Some clients may not pay well or on time. Other clients may harass or mistreat your employees. The list of potential challenges goes on.
If you have a bad client and the situation cannot be fixed, consider firing them. Follow your contracts to the letter and be professional. Never mistreat bad clients. That’s how companies get bad reviews.
12. Payment terms are important
As we mentioned in item #11, not all clients pay well. Some clients, especially large companies, often demand net 30- to net 60-day terms. This demand can create cash flow problems if you cannot afford to wait. Consider using payroll financing, a form of factoring that is designed for staffing companies. It provides payments for slow invoices, providing you with funds to make payroll and grow. Here is how it works.
Do you need payroll financing?
Does your agency need funds to make payroll? We are a leading payroll financing (factoring) company and can offer competitive terms. Click here for a quote or call (877) 300 3258.
Marco Terry is the Managing Director of Commercial Capital LLC and has over two decades of experience in asset-based finance. He has worked with small and mid-sized companies across the United States, Canada, and Australia. Marco holds a Master of Science in Finance.