Although it has been some time since the credit crunch, many businesses are still only just recovering from the effects of such a large, global economic crisis. While recovery has now become more of a waiting game than a distant hope, you may still find that a lot of companies are preferring the flexibility of contractors over the cost of a permanent member of staff. For recruitment agencies who aren’t already taking advantage of this trend, this is a chance for you to create more profitable opportunities.
1. Higher Fees
Contractors will usually be charging at an hourly or daily rate that is much higher than the equivalent cost of a permanent candidate. Businesses are happy to pay for the extra flexibility, and your margins will stay roughly the same, making your total rewards much higher.
2. Persistent Revenue
Because your fees will be based on the length of the contract placement, you will continue generating revenue from your contractors even if you make no placements during a period. As long as you have contractors in place, you are essentially generating revenue without working. Many contracts will also be renewed at least once, leading to even more revenue with only a renewal contract to sign.
3. Greater Versatility
When you focus your recruitment on contractors rather than permanent placements, you become a more versatile solution for your potential clients. With greater versatility comes more referrals and repeat business, as well as a greater ability to secure deals with potential clients.
4. Building Relationships
As you will likely be liaising with your client throughout the contract placement, you will also be given the opportunity to gain inside knowledge of their company and processes, giving you a lead on upcoming placement opportunities. You will also be getting to know the people within the company, making you a much more likely go-to option for future recruitment needs.
5. Impress Investors and Buyers
The day may come when you grow tired of your business. Whether you want to seek experiences in pastures new, or simply want the opportunity to retire on the money you’ve made, you may want to one day sell on your business. A business with ongoing contracts is a business with ongoing profits and turnover, very valuable selling points which will let you sell it on for a higher price.
6. Invoice Finance is Readily Available
Funding contractors can seem difficult at first, but the ready access to funding solutions (such as those provided by Fund My Contractor) make maintaining your contractors and cash flow inexpensive and easy.
So, if you aren’t already making use of contractors, or want to justify the benefits of increasing this area of your business, then these are just a few of the reasons you should be doing so.
Fund My Contractor offer financing solutions that are specialised for contract recruitment agencies, making your transition from permanent recruitment to contractor placement as easy as possible, whether you want to fully convert or just put your toe in the water.
Discuss your finance options with our team now by calling 0845 8811 112.