Profitability suffers once staffing and recruitment agencies increase beyond a team of 20.
The 2016 industry insights, released today, are based on an analysis of 111 staffing recruitment agencies from across Australia.
Nigel Harse, RIBreport director, says the figures confirm historical findings that lower productivity and increased costs are linked to agencies with team sizes of 21 to 40 people.
“Staffing and recruitment agencies of this size continue to face significant challenges managing day-to-day activities while keeping a firm grip on business costs. Everything scales up when a team grows beyond 20 people, improved infrastructure, more space required, additional equipment, higher usage cost for everything and longer debtor days. Increased exposure to higher staff churn, causing a drop in team productivity is another of the many reoccurring challenges. The blind spot is that sales and business development activities have not been scaled up to the same degree.
Profitability is the measure of a successful recruitment agency,” he adds, “and getting the balance right between income and expenses is essential.”
For more information go to: www.ribreport.com.au