ARE YOUR TOP BILLERS LEAVING TO START THEIR OWN AGENCY? WE MAY HAVE AN ALTERNATIVE SOLUTION
Over the past few months TBOS has been approached by a number of recruitment agencies who have come up with a unique way of ensuring they do not lose their top billing staff members to start their own agency.
As any agency director knows, there is always the risk of any billing consultant wanting to leave and start their own recruitment business especially when they are the highest biller in the company and control some of the largest accounts.
When a consultant leaves an agency the impact on profitability, turnover and staff morale can have a detrimental effect and the directors will have to take the time and effort to monitor their ex-staff member’s activities from afar to ensure they are not breaching their restrictive covenants.
Recently TBOS has been approached by some agencies who have decided to offer some of their top billers the opportunity to start their own recruitment company with the caveat of providing the start-up capital and expertise to get the business off the ground.
These new businesses are set up with both the top biller and the agency owner as the directors. There is also a shareholder agreement in place providing the start-up funding in exchange for a portion of the shares. As the agency grows over the years and hits certain profit targets the shareholding is decreased and the start-up funding is replaced to allow the top biller to become the majority shareholder.
As this new business needs to stand on its own, TBOS has been asked to administer the back office and accounting services for the agency and also provide the valuable reporting required by the shareholders to monitor the cash flow and profitability. TBOS acts as a third party within the agreement to ensure that the bank funds are used correctly and that all parties are transparent.
This process is still in its infancy stage with the agencies we are working with, but has helped the agencies to show their other staff that there is further progression within the company. Also, once the process is refined this can easily be replicated for other staff and other agencies.
If you are interested in talking to TBOS about how we can help implement this process within your own agency and need some help and guidance on outsourcing the back office and accounts functionality then please do not hesitate to contact our office