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Due diligence can help you develop effective partnerships with vendors.
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Using temporary workers should involve more than just calling an agency and asking the recruiter to send someone over. In evaluating vendors, get answers to the following questions:
What's in the markup?
Kristy Harris, account manager at NCW Resources LLC, a staffing agency in Rockville, Md., says markups for temp or temp-to-perm placements typically range from 45 percent to 60 percent. The fees for finding a direct hire can be 30 percent or below, she adds.
Know the market rates: Markups on temps ‘range from 30 percent to 40 percent to as much as 150 percent.'
How long does it take to deliver a qualified candidate?
"Benchmark against your own data," advises Rebecca Callahan, president of SourceRight Solutions in San Diego. "If it takes you 70 days, the staffing company should produce in 60."
How rigorous is recruiting?
Does the agency conduct appropriate screening and background checks?
What does the agency consider adequate longevity?
What is the hire-to-interview ratio?
What is the temp-to-perm ratio?
Does the agency have metrics to show client and employee satisfaction?
Agencies without satisfaction data may offer client testimonials, but Gregg warns against giving these too much weight. "Everybody has three clients that love them," he notes.
Does the agency participate in the Best of Staffing program?
What is the internal staff's turnover rate?
Lots to Choose From
The five largest U.S. staffing companies, by revenue, are Allegis Group Services, Randstad, Adecco, Manpower and Kelly Services.
In the United States, entry into the staffing business is relatively easy, creating a diverse playing field of more than 10,000 companies. International behemoths such as Randstad and Adecco vie against each other as well as against smaller locals and regionals. Yet no one company usually rises above single digits in terms of market share.
The top five companies share about 20 percent of the U.S. market. In contrast, the top contenders command more market share in other countries. For example, the five leaders have 80 percent in France and 85 percent in Italy, says Jonas Prising, president of the Americas for ManpowerGroup in Milwaukee.
Does the vendor offer training for internal employees?
Is the staff professionally certified?
Who will be your go-to person?
"My relationship with my HR client is critical," Harris says. "When we place someone, I call on the first day to make sure the person made it in, then three days later, then a week later to see if things are working out."
Is there transparency in reporting and administration?
The author, a contributing editor of HR Magazine, is a lawyer and a professor of management studies at Marist College in Poughkeepsie, N.Y.
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