6 EXCUSES RECRUITERS WILL USE TO TURN DOWN OUTSOURCING THEIR BACK-OFFICE OPERATIONS

TBOS has come across many excuses recruiters will use to turn down outsourcing so we thought we would put together an article which gives our counterargument to each of the most popular used…

As you may of seen there is a growing trend for new and existing businesses to outsource internal processes to ensure their business runs efficiently and more cost effectively. This shouldn’t be any different with the recruitment industry, as with many recruiters their time is precious. That time spent raising a permanent invoice, chasing payment off a client or even uploading timesheets cuts into valuable sales time.

So why don’t recruiters take time efficiency and productivity more seriously?

TBOS have found that many recruiters will leave it until the very last minute to engage with an accountant to carry out their year-end accounts which can sometimes leads to fines, investigations, additional costs and in some cases loss of profit due to incorrect financial advice.

Here we list the most commonly used excuses for not engaging with an outsource company for their back-office & accounts operations:

MY AGENCY IS TOO SMALL TO BE OUTSOURCED

There are many tailored back-office solutions for single person start up’s right through to large scale existing recruitment agencies. By engaging with an outsource company, you receive a full accounts team who will take care of all of your back-office needs, giving you peace of mind and more time to focus on what you’re good at – recruiting. Additionally, as the agency grows the outsourcing company can provide informative reporting which will give you the knowledge to make important business decisions on how to grow the company moving forward.

I’M A PERMANENT ONLY RECRUITMENT AGENCY

Most recruitment directors believe that outsourcing your back office and accounts is only for contract or temporary recruitment agencies due to the additional administration on contracts, invoicing and funding.  However, outsourcing companies also provide a vital service to permanent only recruitment agencies so that these businesses can concentrate on making further placements instead of being distracted with raising invoices, credit control and bookkeeping tasks.

MY PAY-AND-AND BILL COMPANY LOOKS AFTER MY CONTRACTORS

When a recruitment agency makes contract and permanent placements they will often engage with a Pay-And-Bill company to manage their administration and funding on their contract placements.  However, they will often forget the administration required to maintain permanent placements and the company accounts.  These tasks are equally as important and it is advisable to find a company that can not only look after your contractors but also your permanent placements and accounting processes too.

WHY OUTSOURCE WHEN I CAN RAISE MY OWN INVOICES

As a way of saving initial start-up overheads, many directors will consider doing their own administration in the beginning, this includes raising invoices, chasing payments, making supplier payments and some general bookkeeping. Although the intention was to process these admin tasks short term it will often become a long-term situation for the director, leading to long days in the office and incorrections being made. It can also portray the agency as a small business with the recruiter speaking to the same person for the placement, invoicing and credit control instead of a range of employees.

MY ACCOUNTANT HAS LOOKED AFTER ME FOR YEARS

It used to be known that you were more likely to change your spouse than change your accountant as they were an invaluable asset to your business.  However, due to innovations in technology to improve processes and make accountancy a transaction-based commodity, the role of an accountant is often weighed against the work they will complete and the costs involved.  The thing to consider is that general accountants may not have the specific recruitment knowledge to provide the advice your agency needs and they may not want to provide the level of management reporting your business requires to grow.  Using a recruitment specific accountant or an outsourcing company that provides accounting services will mean your agency will stay compliant and give you the reporting you require.

MY INTERNAL BACK OFFICE TEAM CAN HANDLE ALL MY ADMINISTRATION NEEDS

The hardest thing for a recruitment director to consider is whether to take away their existing internal back-office and accounting team and move to a fully outsourced service. Although this may seem alien to the director it is worth looking at how cost-effective it is to have an internal team for the business. There may be also gaps in the team’s knowledge which could potentially put the business at risk. Additionally, there is the complexity of hiring staff, their HR needs and limiting the turnover of staff within your business. By outsourcing you are often provided with a comprehensive service which can fulfil all of the job titles required to run your back office and accounts, with the added benefit of a significant cash saving compared to hiring your own internal accounts team.

HOW TBOS CAN HELP

TBOS provides a full back office and accountancy service to any size recruitment agency who are looking after permanent and/or contract placements.  TBOS provides the same full back office and accounting services to all of its recruitment clients including timesheet processing (TBOS provides an online timesheet system), invoicing (permanent and contract), invoice finance management, contractor and supplier payments, full credit control process, bookkeeping, monthly management accounts, VAT returns and year end statutory work all under the agencies name.

TBOS provides a comprehensive service for new start ups to focus their efforts on making their first initial placements, giving them the best possible start in the industry. TBOS are also able to deliver huge annual savings for existing agencies, switching their invoice finance arrangements and internal processes to work for their unique recruitment business.

For more information on how TBOS can help your recruitment business please call 0345 504 6333, alternatively you can email enquiries@tbos.co.uk