Tired of Being Small? Try this Blended Service on for Size!

By: Ryan Kovach
Date: 3/1/2007

First off, if you are going to get anything out of this article, I recommend reading it in its entirety. No skimming allowed. This is important stuff that may very well revolutionize staffing, as we know it today.

What are the two most important aspects to sustaining and growing your staffing and recruiting business?

1. Access to working capital

2. Relentless advertising and marketing.

When I talk with my clients, I usually hear two things:

1. "We want to market ourselves and advertise so that we stay visible, but we have no budget for it."

2. "Our capital is tied up in receivables and we are barely making our 941s. But, we really do want to advertise!"

I ask you: what are the chances of growing your business without a successful advertising and marketing campaign? Zero! Sure you may maintain existing clients. You may have a sales rep closing a few deals here and there. You may even be doing "OK." If you are OK. with "OK" then stop reading this article and move on! There is nothing left here for you. Good luck in your endeavors!

This article is for the companies, regardless of their size, who are never OK with "OK." The ones who spend an appropriate amount of time and money ensuring that their company remains proactive in advertising and marketing. The ones who understand that without it, their company will never change, grow, or make a bigger splash. You may not currently have the funds to do it, but you understand its importance and want to start doing it. If this describes you, read on.

The Biggest Dilemma of Having No Working Capital
I'm not here to discuss which method of finance is right for you. I won't tell you how to set your bill rates or terms. You are all big boys and girls and can make those decisions for yourselves. But, I will say that staffing, more than any other industry I've come across, is plagued with having a shortage of working capital. Most firms must seek outside help through a bank, a factor, or some other private financier. I believe that the biggest and most problematic downside to an under-funded company is its inability to advertise and market itself. Some may say it's the lack of funds to hire new employees or a host of other issues. But, I'll argue that you'll never have the funds to hire new employees if you don't have the revenue and cash to pay them.

How do you typically get increased revenue and working capital? By increasing your client base. How do you increase your client base? By having a more compelling impression on your prospects than your competition. And, the only way to do that is to raise your level of creative juices. Those juices need to be pouring out of your eyes and ears on a regular basis. (Or at least hire some firm who can squeeze those juices for you.)

Hard Decisions
With a shortage of capital brings great decisions. "Do I run that extra ad in the classifieds, or should I wait until my receivables are paid? Do I reserve that booth at the next big convention or make sure I can cover payroll? Do I send my staff to that really cool motivational speaker or do I sit tight and make sure I can cover my workers comp bill?"

These decisions choke the life out of a company. They cause major gridlock. They force the company to move at the speed of frozen pond water. That's bad stuff right there.

Questions to Ponder
What if you could advertise and market like the big guys? What if, with your current billable hours, you could begin an advertising and marketing campaign that levels the playing field between you and the bigger staffing companies in your market? What if it became very unclear, in your neighborhood, the difference between you and the national acts?

Sound intriguing? Great. Let's move on...
Blended services are nothing new. But, they have proven invaluable in the dayto- day operations of companies in every industry under the sun. Whether it's getting your Internet packaged with your phone service or your back-office billing and payroll bundled with your candidate database manager, blended services make good sense.

The reason is that you typically get two or more much-needed services for the price of one - or at least a greatly reduced discount. Both services tend to be crucial to daily operations. And, usually you pay one bill instead of two or more. Typically, the hired hand has more experience than you at the blended products being offered. And lastly, you usually don't have the time to administer them separately without it cutting deep into productivity.

Solutions
For years, factoring companies have understood the problem of being underfunded. They've offered an invaluable service to staffing companies by allowing them to finance their receivables and have much-needed and readily available cash overnight. That's a great thing! They've also been instrumental in providing blended services such as back-office support. That's awesome too! Having readily available cash and having someone do the mundane chores of collections, billing, and receivables is smart, very smart.

Likewise, ad agencies have helped businesses outsource the creative thought process. By researching and executing an effective ad campaign, an ad agency helps you get the most bang for your buck. Over the years, ad agencies have begun blending their services as well. Most now offer the design, research, media placement, public relations, photography, and copywriting services needed to fulfill the entire marketing process.

New on the Horizon
But, I submit to you that there is something new on the horizon that will make the above-mentioned blended services look like child's play...a blended service that seems so unlikely at first, but makes all the sense in the world upon inspection.

What is this revolutionary new blended service? Factoring plus advertising and marketing blended into one product. That's right. Now you will be able to get all of your advertising and marketing bundled within your factoring service. What this means - for you folks who are already factoring or who are considering factoring - is that included in the service of factoring is all of your design, marketing, advertising and multi-media production.

We've Taken Part
Our firm has taken part in this blended strategy because we believe that it provides - as mentioned in the beginning of this article - the two most important aspects to growing your business.

Under such a blended service you would factor your invoices traditionally. Instead of back-office support being included in the promotion, you would have the opportunity to work with a world-class advertising and marketing agency who will work with you, around the clock, in making sure all of your branding and advertising objectives are being met. In some cases, such as what our firm is offering, the promotion even includes rebates to be used for placing the media. So, not only is there a marketing plan developed and designed, but it will also be executed to the public and your prospects as well. This gives you access to a fullblown ad agency and all of their services, simply by factoring your invoices traditionally.

What Could Be Better?
You'd be hard-pressed to find a more useful, important and appealing set of blended services available to staffing companies. Sure, there are many out there, but few address the real issues facing growth. Having capital and a big, bulky advertising and marketing objective immediately puts you in the spotlight. It allows you to compete at the highest levels and it allows you to work with people who can actually help you grow literally overnight.

If you are sick of being cash-broke and without a real marketing and advertising strategy, I suggest looking into this blended service. My firm, dillinger & kovach, along with The Hamilton Group have such a product. We call it Growth . You can learn more about it at www.growth2.net. FBA

Ryan Kovach is lead Principal of Dillinger & Kovach, an ad agency exclusively for the staffing industry. He can be contacted at 817.719.3109, or by email at info@dillingerkovach.com, or visit www.dillingerkovach.com.