HOW TO START AND OPERATE A TEMPORARY HELP SERVICE
This is a service business with excellent growth potential,
indications of strong stability, a nationwide market with a
growing demand and a risk factor that's rated average or less
than most new business ideas. Temporary Help Services are well
suited to absentee ownership situations; require no experience
or technical knowledge on the part of the entrepreneur; and have
only minimal equipment needs. Net profits before taxes for some
established temporary help services, have been reported as high
as $1,000,000 per year.
There's a difference between regular, private employment
agencies and a temporary help service. The employment agency is
a "brokerage" office that matches unemployed people with
available jobs. The tempovary help service hires people onto
its own payroll, sends them out on contract jobs, and pays them
accordingly.
Temporary help services make money "off the top". They send out
temporary workers on one or two days only jobs paying $10 an hour
to the worker, and collecting $30 an hour for the time the
worker spends on the assignment. More and more businesses are
willing to pay the premium costs for a trained person for just a
few days at a time, than to adopt the burden of a 40 hour week
payroll obligation and the task of finding enough work to keep
such a person busy enough to justify a full time salary and the
support costs. Businesses everywhere are finding it easier to
pay more for "temporaries" than hired 40 hours per week
"permanents". That's the secret of success with this kind of
business, and the point to keep in mind when selling your
services.
The successful temporary help service recruits as many skilled
and qualified workers as possible. These workers differ from
the regular jobseekers in that they're looking for "temporary"
work only. For any number of reasons, they're only willing to
work on jobs lasting from one to five days, or perhaps two to
three weeks, on any one job assignment.
These people are ideal for the employers needing help, but not
wanting to hire and train full time employees. Your task will
be to find and attract top people and to maintain completa files
On them. What kind of jobs they specialise in, their attitudes
about work, and when or how often they're willing to work would
be essential information to have.
Each person should be tested in your office, sent out on a few
assignments to build up a favorable reputation as a good
worker, then offered a permanent listing on your roster of
available specialists.
Work hard to build your roster of available workers. Within
ninety days of start-up you want to be able to send someone out
to fill any employer's needs, regardless of the job
requirements. Job assignments will range from loading dock and
light clerical work to word processing. Depending on the size of
your market, you could conceivably specialise in temporary help
for data processing, the medical or legal professions, or
perhaps the retail trade; and you'd still make a lot of money.
Generally, though, we are going to show you here how to start a
"full service" temporary agency.
You'll need a good mix of employers in your area for best
chances of real success. Your area can be one of high
unemployment or one with relatively few unemployed. Whichever
the case, the thinking of the business community and the work
force available should be non-traditional; there should be an
undercurrent of thought towards the idea of calling in
specialists to handle a job quicker, and more efficiently, than
the full time worker.
The people wanting to affiliate with you as workers will be
housewives, college students, retired people, and a large number
of people who like to work, but don't want to be tied down to a
regular job. When you explain the concept of your service,
you'll be pleasantly surprised at the number of traditionalists
you'll convert to temporary workers.
First, you should visit your local Chamber of Commerce office.
Explain the philosophy of your service, meet the chamber
officers and ask for their help. You'll find that they have a
listing of all the businesses in the area, plus the names of the
"right" people to talk to in selling your service. If you
request, you might be invited to Chamber meetings and be
introduced to the business leaders in your community. The only
kind of information they will not be able to help you with is a
listing of small, home-based one-person enterprises.
You can locate your offices just about anywhere. You'll find,
however, that your greatest success will come if you locate in a
modern office building housing professionals, such as lawyers,
accountants, insurance companies, etc. Project a professional
image. Locate in a city center or business section of your town
if you can.
Basically, you'll need 600 to 700 square foot of office space.
You should have a reception area, two offices, and a room to
store supplies. The more prestigious your business address and
office, the better calibre of clientele you'll attract. People
looking for temporary work, and employers considering using your
services, will doubt your abilities if they aren't favorably
impressed with your image.
It is possible to start this business in your home, but make
sure you have the space for a reception area, and at least a
semi private interview area. Most of your selling efforts will
be conducted by mail, phone and personal visits to the
employer's place of business, so you won't have any problem
there.
So, practically speaking, starting your business from home will
require a much smaller initial investment. In this particular
business, rent and advertising will be your largest expense, so
beginning the business from your home is definitely worth
considering if your start up funds are limited.
In actual operation, you could have the applicants interested in
your services contact you by phone. You would then set up
appointments either in their homes or your own, thereby
eliminating congestion of cars in front of your home. If you
began on a part time basis, you could have a family member or a
friend answer your phone and set up appointments for you. If
you do begin part time, and working out of your home, you might
look into the advantages of a professional telephone answering
service.
Another idea for saving on costs might be to rent unused space
from businesses already established. These businesses might be
sales or distribution offices, suburban insurance agencies,
quick print or copy shops, and repair shops. Look around - many
businesses have had to take what was available at the time, and
would be more than happy to lease or share their vacant space.
Keep in mind though that you'll do much better with an office of
you2 own, and you should move into one just as soon as you can
afford one. Proper facilities that convey a professional image
should be number one on your list of priorities.
Your business image is projected by your address and the
appearance of the building in which you locate. Your reception
area will set the mood of professionalism and efficiency. The
reception walls should be inviting - walls painted in light
pastel colors, wall prints, floor lamps and wall to wall
carpeting. It should also feel comfortable while being
functional. Comfortable modern chairs and sofa; perhaps a floor
planter or two, reception desk and ash trays all help to achieve
this effect.
The main office need have only a desk and a comfortable chair,
facing the door, a chair beside or in front of the desk, and a
file cabinet. A print or two on the walls, and perhaps a book
case are the only "extras" you might use to dress up your office.
Your second office will be for testing your applicants. You can
inexpensively build a table along the length mf two walls,
partition it into cubicles and have an electronic typewriter, an
adding machine, and maybe a headset connected to a dictation
machine, and another for testing shorthand capabilities. Later
on, you'll probably want to have a word processor and a computer.
Ideally, you should also have a sales office and a storage room.
The sales office will be where you greet and talk with
employers who drop in to look you over to find out more about
your business. Mainly, this office will be where your people
will work from when calling prospective clients and selling your
services by phone. The storage room needs only shelves to hold
various forms, mailing pieces, envelopes and business records.
One way to hold your start up costs to a minimum is by leasing
your office furniture and equipment. Whatever you do, remember
that you're projecting an image, so don't settle for less than
the best. This is absolutely imperative in regard to any
equipment used for testing your applicants. You might be able
to work out an arrangement with the business department of a
local college, or business school, to send your applicants to
them for testing on their machines. Such an arrangement, even
at a cost of $20 or so per test, could save you several thousand
pownds in start up costs.
The first person you should hire should be either an experienced
manager or someone you can quickly train to assume those duties.
It's best to hold out for a person with at least one year
experience as a Bona Fida Personnel manager. This person should
be outgoing, detail minded, people orientated, and be able to
work well under pressure.
Your manager will be responsible for organising the interview
and testing systems, for setting up your sales solicitation
program and for supervising the temporary workers, as well as
your office staff. It's a highly responsible and demanding
position, so don't be reluctant to spend the money necessary to
get the best. You will need to research to determine what
salary such a top manager receives in your area.
The next member of your staff should be an enthusiastic,
hustling sales person. This employee should be experienced and
adapt at selling by phone as well as in person. Unless you can
afford to pay a good direct mail advertising copywriter to
create your mailing pieces for you, it would be wise to look for
direct mail advertising or copywriting experience.
Your sales person should spend the mornings calling prospective
employers on the phone, and the afternoons making in person
sales calls. With this kind of routine in mind, look for sales
people with high ambition and energy levels. Try to pick the
kind who'll come in early and stay late to work on his direct
mail efforts, clearing the decks so that he uses his time during
regular business hours to close sales by phone and in person.
You need and want a 'closer' - not an order taker. Be as
selective as you have to be in choosing this salesperson.
In addition to the going rate which a sales person of this kind
should be paid, you should also consider paying a 5% bonus for
every new account brought in. When you find the right person,
it will be worth it, so make it worthwhile to join your staff.
Not all sales people will necessarily develop into good sales
managers, so try to find one who fits all your requirements.
The sales manager would recruit, organise, develop, motivate and
supervise your sales staff. With those responsibilities, you'd
want to offer a salary plus override on the sales production of
his staff of sales people.
You'll need an efficient and foolproof book-keeping system to
keep track of your payroll, client billing, income taxes, work
schedule, hours worked, and all the money that comes in. For
this chore, I suggest that you contract with a company that
handles this type of work. Explain to them everything you think
you need: ask them to set up a system, and then instruct your
receptionist on how to keep it up to date on a weekly or monthly
basis.
The last of your staff will be your receptionist. This person
should be attractive, have a lot of empathy with people, and an
easy smile. They should dress stylishly, but not provocatively.
When they are not answering the phone or greeting customers,
they can be administering tests, doing miscellaneous typing,
making folders for the records of your workers, and general
office duties.
The kind of temporary workers you'll want to attract will fit
into several general categories, and can be recruited in a
number of difverent places. Try having brochures made up about
your company, and send them to career counselors at your local
business, secretarial and technical colleges in your area.
Another group will be housewives who perhaps held regular jobs
before marriage or the birth of a baby, and now want to get back
into the job market. You can bring these people in by posting
notices in shop windows, arranging announcements at meetings,
etc.
Another group to recruit will be the "bored with life" people.
These will be in the job group not sátisfied with the future
where they are, and looking for a better opportunity.
It is imperative that you begin recruiting and signing workers
as soon as possible; at least a month before you open for
business is not too early. According to industry surveys, the
most common reason for the failure of temporary help services is
not enough workers lined up to fill client demand. When you get
a request for help, you should be able to send out a qualified
person.
Each market area differs in the number of different types of
workers a temporary help service should have available, but in
every case it's best to have more than you figure to be a basic
need. You must establish a maximum number of people within any
one occupational field that you'll sign up, or else you won't be
able to keep everyone busy. Unless you keep the workers you
have registered working pretty much as often as they want to
work, you'll begin to lose them.
It's not hard to determine when a person is losing interest in
temporary êob assignments through your firm. Whenever you call
to give an assignment and you can't reach the person you're
calling, try several follow up calls. It should become obvious
to you that they're no longer interested if you still can't
reach them with your follow up calls. It's a good practice to
ask for notification of vacation or other plans that will affect
their availability for work.
If you call and a job assignment is refused with a lame excuse,
come right to the point and ask if he wants to change his
availability status, or if you should drop him from your list of
available temporary workers altogether. Never coddle a
temporary worker. If he's not available when you call to give
him an assignment, or he gives you a less than valid excuse for
not accepting, flag his call assignment card and move on to your
next available worker. You might call a couple of days later to
check his availability, and interest in continuing to work, but
don't waste too much time. You can always reinstate such a
worker, but it is probably better to spend the time recruiting a
replacement.
As mentioned earlier, one of your major expenses will be for
advertising. Your manager and sales people should keep you
advised on your current advertising impact and results, and from
this you should have a good understanding of how to use your
advertising budget most effectively. Your advertising should be
double-barrelled, aimed at both the employer and the worker.
Generally, your efforts to add new employers to your clients
list should focus on direct mail. Advertising efforts to
recruit new temporary workers should be almost exclusively
devoted to newspapers. Years ago, some radio stations sold
sixty second commercials to a few temporary help agencies. The
agencies talked to prospective employers, playing up the fact
that they had skilled workers to handle overload and deadline
situations. These commercials were broadcast in the mornings
before 8 o'clock. Then they followed up during the afternoon
hours with commercials inviting people seeking temporary work to
come in and sign up. Everything worked well except that not
enough prospective employers called often enough to justify the
expense.
For really professional results, you should get a freelance
advertising copywriter to do your direct mail piece. This
should be a page brochure, emphasising these points.
All employers have sudden work overloads, face deadline
situations, or are suddenly left with a mountain of work for
specially trained employees just when they are sick, on
vacation, or off on an emergency.
Your company understands these workload problems, and has
skilled professional replacement workers who can quickly step in
and get the job done.
Your company thoroughly tests each of the specialists hired for
these special staffing crisis situations, and can assure tie
employer that they are tops in their individual areas of
expertise.
Your company is well aware that many businesses would like to
save the expense and headaches of hiring a full time specialist
of the same calibre of your people on a Temporary or Oncall
basis. Your people cannot be hired by the prospective employer
because they already work for you, but if and when a temporary
worker is needed, your company stands ready to fill the need,
regardless of the job speciality required.
Even if he doesn't need one of your people today, the need could
arise at any time, and suddenly. So they should keep one of
your brochures handy, and don't hesitate to call you personally
for whatever temporary help is needed.
One you have the copy written, decide on the layout and type if
and what color should be used, and take it to the printers.
Your brochure should be prinved on 100 grams paper, or art
paper, and folded to your requirements by the printer.
Your complete mailing should consist of a short cover letter
inviting the recipient to avail himself of your services; a
brochure explaining your services in greater detail; postage
paid business reply envelopes. The mailing envelope and the
cover letter should be addressed to each business owner or
personnel manager by name.
Your newspaper ads for qualified workers looking for temporary
assignments should be display ads in the "Help Wanted" or Part
Time Work" section. Most such ads are one column wide by 3 to 6
inches deep. Be sure to have an ad running on a Wednesday or
Thursday.
These ads should invite the readers to come in and register for
work with your company. Work with your freelance copywriter to
say what you want to say. Overall, though, these ads should
explain that you have plenty of jobs going begging; that the
worker sets his own days to work, and can take jobs as seldom or
often as he likes. In day to day operations, your manager will
interview applicants, talk with clients, solve problems, take
orders from employers, and make job assignments. Usually, his
busiest time will be right after lunch when job orders start to
come in. With this in mind, you might want to arrange for him
to take an early lunch period.
While your manager is "running the show", your sales person will
be making telephone calls in the morning, and visiting in person
during the afternoons. It's a very good idea to send out your
direct mail advertising one week, and then call on these same
people, either by phone or in person, the next week. Remember
that your sales calls should be relaxed visits, allowing the
prospect to learn more of your busiless and the kinds of people
you have available. During each sales call, the prospect should
be left with the feeling that your company can save him money,
solve a lot of production and scheduling problems, and take the
exasperation out of his personnel requirements.
As a rule, you'll find that most jobs are called in during
afternoon hours. With this in mind, it would be wise to have
set procedures for your specialists to call you each afternoon
to let you know where they can be reached until 5.00pm if they
are available for a job assignment the next day. You might want
to set a policy of "No call from you - no assignment for you".
Most temporary help agencies give their workers a supply of 3
part time cards when they're hired by an agency. When the
request for a worker comes in, the most qualified in the
required caôegory is called. Job, name of company, location,
approximate length of job, and payment are all explained. If
they agree to take this job, they fill in the time card for the
day the work begins. When they report for work, they have the
time card signed by the employer to verify starting time, and
finishing time. One copy of the time card stays with the
employer; the temporary worker keeps a copy; and the other copy
is mailed to your office. Smooth and simple, but make sure
you've got everything worked out before you begin.
Your book keeper notes the proper information on the ledger for
that employee, files the time card and sends a ledger duplicate
to accounting for billing. Of course a reminder call should be
made first, but as a rule, any account that hasn't paid within
thirty days should receive a personal visit. As to the hardcore
delinquent, no more temporaries should be sent, and a collection
agency should be used to clear up the account.
You will have to get a licence from the Department of Employment
to run a temporary help agency, details of which can be found at
your local library.
That's it then - the how, what, why and where - of getting
started with your own profitable temporary help service!
Remember, it takes solid and consistent advertising, earnest
recruiting and selling. So don't stop or let up until you have
everyone in your area registered, and every possible employer as
a client, aware of your business. It's a big job with lots of
challenging work involved, and you'll need good people to help.
It is worthwhile to search out these people with care, to be
sure you have good reliable, employees - the rewards will be
well worth it! Organise your business for success, and get with
it!
