Over the last 2 years the hiring and recruiting market has changed drastically. The COVID-19 pandemic and the rise in remote work has enabled employees to work anywhere, for anyone, at any time. Gone are the days of physical office locations, and 40 year careers at one company. Employees today desire flexibility, work life balance, and the ability to work wherever they are located. Have you ever heard of the “Gig economy”? According to a recent survey of job seekers done by Monster, “52% said they would like a long term contract with flexible hours.” This has affected the direct hire and contract recruiting markets, but it has specifically increased the need for contract workers. This has made many recruiting firms wonder, “how can we start offering contract and temporary staffing services to our clients?” Below we go over 6 simple steps to start offering contract and temporary staffing services to your clients.
Direct marketing to clients
You can’t get what you don’t ask for! If you want to start generating recurring revenue, you need to make it know that you offer contract resources. Simple steps to start are to list some of the below service lines on your website and social media.
- Contract Staffing
- Temp Staffing
- Contract to Hire
- Contract to Direct
- Temp to Hire
- Project based consultants
Allowing your prospective customers to find you for the services they want will begin the flow of inbound leads to your firm. Then from there it’s time to enlighten your current customer base. They most likely are receiving contract and temp talent from another agency already. So, simply asking, “do you ever need contract or temporary staffing?” is a good way to start the conversation. Letting your current customer base know you now offer contract and temp through email and other written communication is also recommended.
This mix of communications should kick start your contract staffing pipeline and enable to you begin developing your goal of recurring revenue.
Outside of simply posting your offerings on your website, there are a couple tactical strategies to generating contract and temp placements. There are two specific situations where you could propose a contract relationship to win a deal that is uncertain.
#1 The client is on the fence about a candidate:
If your client is on the fence about a candidate for a direct hire role, you may feel that the deal is slipping away. However, this is exactly where a contract-to-hire relationship would work. Positioning contract-to-hire as a “trial” or “try before you buy” technique has been proven to increase close rates. What this would allow your client to do is get the candidate into work, and see how they perform and interact with others. If they find the candidate to be a good fit, they can convert the candidate to a full time employee, and you can earn a conversion fee. If not, then the client can move on with little consequences or concerns, in hopes of finding another candidate, which you can help them find.
#2 Candidate on the fence about a job:
Interestingly enough, the same type of scenario would work if the candidate is on the fence about a job. They also could appreciate a temporary arrangement, to see if they like the role. If not, then they can move on quickly to find a new position, which you can help them with.
If you are working in the technology or management consulting space, you may have heard this term before. According to Toptal, “Staff augmentation is the use of outside personnel on a temporary basis to augment the capacity of your organization.”
We see this type of arrangement when clients implement new technology or process and need experts to stay onboard to integrate that change. This poses a great opportunity for recruiting and staffing firms to offer talent to help get them through those projects. 3, 6, and 9 month assignments typically are standard in these types of relationships.
Your client base may need to change if you are not targeting the proper buyer segment that uses this type of talent. Rather than targeting the end user of the new technology or process (which still may work), you may need to target the companies selling these services. Those could be consulting companies, systems integrators, value added resellers (VARs), and other organizations like this. They typically have a healthy need for contract and temp workers to help them complete projects for their clients, which are the “end users” in this case.
Extended Absence Backfill
Hiring managers are dealing with all types of issues every single day. As they try to run their department, many times their biggest concerns are related to being short staffed. In those situations, contract and temporary staffing can help them bridge the gap! Your ability to find temporary workers to back fill their open positions could be critical to them achieving their goals as a departmental leader. This can improve your relationship with them and creates personal value for your services.
Some of the most common short term vacancies are due to:
- Parental Leave
- Short term disability
- Long term disability
Becoming a trusted resource to provide the necessary support can build a strong brand and reputation with your customer.
Payrolling Self Sourced Candidates
It’s a new day in the world of hiring and recruiting. No longer are hiring managers solely reliant on recruiters to find candidates in private databases that they’ve built for years. Rather they can leverage a number of different sources for candidate sourcing at one time. Online job boards, referral networks, AI matching technology, and more allow them to self source candidates. They may even be doing this while working with you to fill a role.
However, if they are self sourcing contract talent they still may need to leverage a payrolling or Employer of Record (EOR) solution. That is where you can come in. Whether you become the EOR, or you use and EOR like FoxHire, you can use this type of arrangement to earn even more recurring revenue from your clients.
The benefit to the client is the same. They will save time and money, and mitigate their risk when leveraging a payrolling or EOR service for their contracted workers. Whether they source them from your recruiting firm, or themselves, does not matter.
MSP and VMS programs
Clients in all industries are continuing to work with Managed Service Providers ( MSP) and Vendor Management Systems (VMS) vendors. These vendors allow organizations to consolidate their vendors and evaluate their spend on hiring and recruiting more effectively. This along with a number of other perceived benefits is why we see an increase in VMS/MSP activity across the United States.
MSP and VMS programs allow you as a recruiting firm owner to gain access to job orders you otherwise would never be able to see. This can instantly allow you to start recruiting and filling roles, without ever having to speak to an end client in some cases.
That said, there are a number of risks you take on when working with VMS and MSP vendors. Additionally, these programs are highly competitive. Pricing and speed will be the determining factors of whether or not you are able to consistently win placements. There are many firms in these programs competing for the same job orders, which makes it difficult to win placements.
Taking the First Step
Now that you have some proven strategies, it’s time to start positioning yourself as a contract staffing agency. If you are still concerned about having the necessary infrastructure like payroll funding, workers compensation, benefits, and time sheets, you can partner with an EOR like FoxHire to handle those aspects for you. To learn more about FoxHire, please review our What We Do page on our website.