Developing a Growth Plan for Your Staffing Company


“No goal is achieved without a plan and no plan goes anywhere without being executed”

Although growth strategies for many businesses may be similar, the staffing industry  has its own unique realities that call for significant variations in their approach to growth  Therefore, in this article we will consider both the similar and unique elements, in five key areas for developing a sound growth plan.

These key areas are:  the staffing market, your company’s goal(s), your resources, retaining clients, and acquiring new clients by earning them.

#1 The Staffing Market – National, Regional, Local

No matter what individual staffing market you are in, or if you are just entering, it can be very helpful to get a more global indication of the size of the overall market and its distribution.  Much of this information is readily available from the staffing industry’s two major trade associations.  For example, according to the American Staffing Association (ASA)  staffing industry statistics, there are about 22,000 staffing companies in the United States accounting for about 39,000 offices.  That can tell you a lot.  First, it indicates that the average staffing company in the USA has a little less than two offices each.  Considering the number of  regional and national companies with hundreds of offices (some with more than 1000) we can reasonably estimate that the most numerous of the 22,000 staffing agencies are single office companies.  There is a reason for this that should be noted in your growth planning which is that many of the most profitable companies are small with niche, local markets

The size of the industry, in terms of dollar volume, is about 140 billion according to Staffing Industry Analysts (SIA) – 2018 list of largest US staffing firms. . .with 22.3% of the market share going to the top five companies.  The top 143 companies account for 58.6% of the market or about 83 billion. That still leaves about 41% or 57 billion of the industry dollars to be “shared”, however, unequally.

Of course, among the remaining 21,850 companies remaining or about 2.6 million each.

Local and Regional

Considering the above information about the national market and the implications for the local one, you may want to continue your study of the market by looking at the competition locally and regionally to see which staffing companies are “boutique”, i.e. with only one or two related specialties; and, which may be fairly large and serve many industries.  Make a list.  Any industries missing?  Any “low hanging fruit?”  Any niche opportunities?

You should certainly visit your potential competitor’s websites for information on the markets they serve. Sometimes a company will list more industries on their websites that they actually serve.  Look closely.  Your competitors Linkedin, Facebook, and Twitter pages will also prove fruitful in getting to know the market.

Look at a good regional map and pinpoint where there are staffing company offices.  Pinpoint businesses that are known to outsource some of their staffing needs. How competitive is the market?  How do you evaluate the quality of the competition?  If an area begins to look good, test it.  Call on a few prospects and introduce yourself.  Are there any good locations for an office?

If one of your goals is to expand into a nearby area this information will be critical, and equally so, if you are a newcomer to the industry looking for a place to begin.

As you close in on a potential office location, some other items on your checklist would be:

    • Other nearby business prospects
    • Detailed demographic data
    • Safety of the area
    • Public bus and rail service
    • Available parking
    • Hospitals and Urgent Care facilities

The investment of time in studying a market’s many details will be well rewarded.

#2 Your Company’s Goals for Growth

Usually, you might think “your company’s goals” would come first in an article like this, but I believe it is always a good idea to review the local and regional market before  thinking about goals.  Ideas for the growth of a business often grow naturally from a study of the market.  And, it’s amazing how, in so many areas, even 5 years can make a huge difference in a market, with new neighborhoods, new businesses, expansions, competitors, and yes, even lots of potential new clients.

So, what can your study of the market suggest in terms of potential goals: here is a short list:

      • A new market segment under exploited – plan to exploit it!
      • A great new branch location in an under served are – plan to be there!
      • New businesses in your market area – be the first to contact!
      • New businesses planning to move into your area. Contact before the move!
      • A competitor with significant vulnerabilities suggests a more aggressive sales initiative.
      • Competition density and quality suggests more modest growth goals.
      • Changes in the outsourcing market like the “Gig Economy”. Research it, understand it, then sell into it!

Your company goals should have maximum input from your staff because it not only helps with morale, but they are the ones who will be, to a large extent, implementing it.  Even a goal so often “closely held” by management like “increasing net income by 4%” will need the cooperation of staff in reducing costs and increasing sales.

I am from the school that believes everyone in the office should be on the selling and efficiency team.  It can be fun and there could even be bonuses!   A company “brain storming session” can be helpful (and fun) in suggesting many goal.

In addition to everyone’s favorite, like “increasing income”, here are a few more:

      • Establish an ongoing staff training program (software, interviewing, client interaction, etc.)
      • Attend industry conventions (ASA and SIA) with specific goals (payroll financing, compliance issues, staffing software, etc.)
      • Better workflow organization
      • Establishing or expanding a benefits program
      • Establishing a monthly “New Sales Day”
      • Improving your website and social media presence with specific and measurable effects.
      • Beginning an ongoing employee and staff survey (confidential and/or open)
      • Client appreciation day.

#3 Your Company’s Resources

Any plan for growth is also going to need a realistic evaluation of your current resources and future needs.  “Resources” are not primarily financial, especially when the focus here is “Planning for Growth” which could be a company just starting out, like “Russ” Kelly’s two girl team in 1946; or “Kelly Girl” today.

I wonder what Russ Kelly’s plan for growth was in 1947, 48, or 49?  His was a very small company indeed! Today a “small business” in the staffing industry is defined by our government as one with gross receipts of less than $30 million!

Being under thirty million in gross receipts is the eligibility standard for a staffing company to receive a business loan from the Small Business Administration.

But if you exclude the top 200 staffing companies from the total of 2,200 in the US market, the great majority would have receipts far less.  The annual receipts range for most staffing companies in the US is between $500,000 and 2 million.

The point here is that most staffing companies are “small” businesses and the primary resources in any small business is going to be you and the staff that you hire. That can be intimidating and limiting because a small business owner needs to wear so many “hats” that he or she is bound to be incompetent with, at least, a few of them.

Knowing this “grim” reality, and the humility it hopefully creates, allows you to more honestly consider the very positive personal resources that you bring to the business as well as the areas where you many need help. And the really good news is that help is always available. You can learn and you can hire.  Not “learn or hire, but both. So, if you are not a good “numbers person” you not only hire that skilled person but “learn” the numbers yourself. Ditto for not being a “people” person.  Hire one certainly but also learn to be a better “people person” yourself.

So, money is not the key resource for most staffing companies.  And, even if you do not have a substantial amount already, you can always earn it or borrow it; it is a commodity.  You and the staff you hire, train, supervise, are not.

So, the takeaway here is that you are the key resource for your business.  The key resource in planning for its growth and guiding that plan through the critical stages of implementation.

#4 Retaining Clients

I have often thought it strange how often state and local governments go all over the country to sell businesses on locating in their areas by offering tax abatements,  infrastructure improvements etc., while existing local businesses are often moving out.

Strange, yes, but many businesses do the same thing  Of course, losing clients may well be inevitable, but if you can sell new clients on coming over to you why can you not have, at least, an active plan to sell them on staying with you.

So, I changed the title of this topic from “Client Retention” to ”Retaining Clients”. It is a small but important difference.  The first is passive, the second active. “Client Retention” may be based on your good work at competitive prices etc.,  but it is still, essentially, a passive “plan”.  We assume they will all stay if we do our job right.  Wrong!

In our planning for growth, then, we need a very pro-active plan for the activity of retaining our existing clients or else we are simply playing “musical chairs”, or “spinning our wheels” rather that solid growth.

Play some defense as well.  Online you may want to visit a site called socialmention and plug in your competitors, their principals, and even yourself, to see if there is anything useful competitively; or, in the case of information about yourself, you may discover something to celebrate or to defend against. Always better to be aware of what is being said about you and your business.

Some strategies for the active retaining of existing clients are already being pursued and others are probably being developed as this is being written. Some are very cost effective, but cost effectiveness is always relative to the average value of a single client.

This varies widely in different businesses. What is the average client value, over the average, or potential lifespan of the account?

Here are a few ideas that you can evaluate alone and in combination:

      • None-sales personal visit, lunch or golf
      • A three question, 30 second satisfaction survey
      • Be competitive yet profitable
      • A personal note for appropriate occasions
      • Avery good and informative newsletter
      • Gift at Christmas, Hanukah or New Years’ (other)
      • Great customer service (responsive, competent, cordial, attentive, pro-active
      • Following client’s Linkedin, and Facebook pages with appropriate none-obsequious comments.
      • Know your client’s companies and recommend to others when appropriate.
      • Your thoughts?

#5 Acquiring New Clients by Earning Them

Finally, if your company has been following a plan that encompasses the above critical areas, you are more than halfway to having “earned” new clients.  Maybe you have even “fully earned” a chance with a new client to show what you can do for them  But, no matter how good you are, it is well to remember that you are never “entitled” to anyone’s business.

You will now get more referrals, making appointments will be easier; and, the direct sales presentation will be more confident and relaxed. You, or your salesperson(s), with credibility, be more of an advisor which is what a professional salesperson should be. Although cordiality is always welcome, the age of the backslapping salesperson ended long ago, although some may not be aware of this. There is no need to comment.

Planning for growth in a staffing company can be great fun and executing it competently, even more so.

I wish you great success!  Your planning and execution will have earned it