Many successful staffing firms decide to expand their presence by opening new offices. In addition to new offices, perhaps you would like to expand into a new staffing niche. Much of the experience you’ve applied to your current staffing space can carry over, but there are also challenges. Here are some tips:
Conduct market research and create a marketing plan:
- Determine if there is a demand for employees in this industry.
- Discover if there is room for another staffing firm in your new niche of market area. If the staffing space is saturated you may have a hard time obtaining business.
- Ensure a sufficient labor pool exists.
- Familiarize yourself with the latest technological changes and new ways of doing things in a new industry. Staffing firms that grew the most in 2022, leveraged automation and digitization.
- Research potential clients in your new industry and define their needs. Review association websites for information. Are there events you can attend?
- Build a list of contacts you can reach with your marketing material.
- Make use of social media and blogging to get the word out to potential clients. The responses you receive can give you an idea if there is a market.
Develop a financial projection including sales, costs, margins and profits for the first six months:
- Can you pay you the salaries needed to recruit the best and the right people? Employees in a new industry might require different skill sets for some job descriptions e.g. administration.
- Determine how many clients you will need to be profitable. Are you dealing with small clients who may not require as many employees, or large clients who will need more?
- Calculate the cost of overhead. In addition to salaries, how much office space do you need for a full staff? Will you need to provide special training not offered by clients?
- Take into account the cost of insurance requirements such as workers’ compensation. Are you using a PEO, EOR, State Fund or Private Carrier? Here’s a chart to compare all these options.
- Calculate the costs associated with occupational health and safety rules and regulations.
Have a solid recruiting plan:
- Provide very specific job descriptions for what you need.
- Prepare a list of questions to screen out applicants that don’t meet client needs.
- Keep lines of communication open with all applicants. Just because an applicant isn’t fit for one position doesn’t mean that they won’t fit for another role.
- Use video interviews when possible to speed up the hiring process.
- Get client feed-back and act on it both for the benefit of your client and your employees.
Employ the same values that you practice in your current staffing business in your new niche/office:
- Remain client focused. Can you handle a crisis when it arises? Can you protect their information? Can you provide the same ease of hiring in your new niche?
- Listen to your job seekers. Do they have the resources to meet client requirements? Listen to their ideas on how they can contribute to your business, especially if they understand this niche.
- Continue the same safety practices and make sure your clients are too. Make yourself aware of new requirements and make them a part of your process.
Ensure your daily operations run smoothly with the right software choice:
- ATS/CRM – Ensure you have a workflow and compliance tool for managing applicants. You need an ATS where recruiters can create and post jobs, collect and organize applications and screen candidates and a CRM to strengthen communication with potential applicants.
- Accounting & Billing Software – can you current software run your payroll, handle A/R & Billing, AP, and General Ledger. Either have an all-in-one software or outsource this to a responsible 3rd party.
- Remote Hiring Software – your software should encompass online jobs, online applications, onboarding, employee and client portals and resume parsing.
Moving into a new staffing niche or opening a new office can be an exciting time for you and your staffing agency. However, it’s important to approach the process with caution and ensure you have a solid plan in place. Strengthen or build upon local networks and partnerships, your in-house team, develop a clear marketing strategy, and invest in technology and infrastructure if you haven’t done so already.