We’d like to talk in this blog about something that can save your recruitment agency money. A way to make you more efficient. Something that frees you up to really focus in on your core competencies, a catalyst for streamlining your operation, and reducing risk.
DOES IT SOUND TOO GOOD TO BE TRUE?
Maybe it does, but it’s something that is available to you right now. We’re talking about outsourcing. Non-core internal processes can easily be outsourced to an external company, so allowing your management team to be totally focused on the areas that impact directly on helping to deliver customer and candidate value and as a result, increased profits.
Areas that are ripe for outsourcing are those that are process-driven, such as administration and finance.
AND YET MANY RECRUITMENT DIRECTORS ARE RELUCTANT TO CONSIDER IT AS A STRATEGY
Whilst outsourcing sounds straightforward; we regularly come across concerns when directors are asked to pass over control of certain areas of their business to an ‘outsider’. Usually, it comes down to some misconceptions about the role of outsourcing and how it works. So below, we aim to bust some myths, specifically relating to outsourcing accounts and back-office functions.
IT WILL COST ME MORE
We promise you it won’t. Think about the infrastructure and associated costs that you need to deliver an accounts function effectively: recruitment, salaries, pensions, office space, furniture, computers, software licences, stationery. The list goes on. Directors often think that outsourcing is expensive, but the reality is that a third party can deliver a comprehensive service at a fraction of the cost of handling it internally.
I WANT FULL CONTROL
Many agencies start small, with the founder being used to being involved in everything – especially the financial side. As the company grows, that director still feels more comfortable being hands-on. It’s totally understandable. But successful agencies reach a point where that is no longer viable. We find that as soon as the director builds trust in an outsourcing partner, it becomes easier for them to let go. And once they do, they realise how outsourcing is freeing up their time to spend on customer-centric activity.
IT’S LESS EFFICIENT
Surely it’s easier just to do things yourself than brief an outside party to take over? Well, think about what it would mean to outsource your back office. No more invoices, payrolls or timesheets to juggle. More time to spend developing relationships, talking to customers, agreeing on contracts. As agencies grow, so do the burdens of admin. What was once manageable now threatens to engulf you. An outsourced company that can focus solely on running your back-office functions will be more efficient, not less. Things happen regularly, on time, every time. And with that certainty comes the peace of mind that tax returns have been submitted and payrolls run.
MY AGENCY IS THE WRONG SIZE TO BENEFIT
Small agencies often feel that it’s not worth outsourcing and that the cost will be too high to make it worthwhile. On the other hand, large agencies worry that an outsourced partner won’t keep track of multiple placements and high numbers of internal consultants. Neither view reflects reality. Any size of agency can benefit from the efficiencies and costs savings that outsourcing can deliver. It delivers more time to small agencies to concentrate on growth, and more focus to large agencies to plan and strategise.
IT WILL EXPOSE WEAKNESSES
This is a sensitive one, but sometimes agencies are run hand to mouth. Juggling their accounts and cash flow to just about manage but in reality, causing sleepless nights for directors who are trying to deal with the financial challenges as well as keep the agency operating. Rather than exposing weaknesses, outsourcing will help to clarify and address your challenges. You’ll know exactly where you stand, and a great outsourcing partner will help you to manage your finances more professionally and move to a more secure position.
Here at TBOS, we specialise in providing an outsourced back office and accounting service for recruitment agencies. Many of our clients have initially been reluctant to convert to outsourcing. But we can genuinely say that all of them recognise the advantages once they have come on board and learned to trust us.
Our pricing is based on placements made rather than turnover, so it is ideal for start-ups or smaller permanent agencies as well as larger contract agencies.
For more information on how TBOS can help you outsource the back office and accountancy of your recruitment agency, please contact our office.