Recruitment Insights

Why agencies should consider outsourcing their back office

April 19, 2017
Plus, the things you should know before changing your back office systems.

Considering Changing your Back Office Solutions for Recruitment?

Plus, the things you should know before changing your back office solutions for recruitment.

Taking advantage of cloud-based software has become a popular way to streamline back office solutions for recruitment agencies’ operations.

The major benefit? By outsourcing your back office, you free up more time to focus on what’s important – growing your business.

So, how do you know if you’re ready to outsource your back office?

In our experience, there are three key times in the business cycle of a recruitment agency when owners should review their back office.

  1. If you’re looking to grow your recruitment agency, which will mean up-scaling your systems to handle more placements, payments and admin. If you don’t get your back office right during this period, you could risk making errors such as missing payroll, or getting your calculations wrong.
  2. If you need to reduce costs. This time of downturn is also a smart time to make sure your back office is optimised so that you can see where savings can be made, and consider turning your fixed overhead into a variable cost.
  3. If you are experiencing frustrations with collecting timesheets, complicated payroll including volatile payroll commitments, or you are struggling to meet your cash flow needs. Put simply, outsourcing your back office will help bring your operations back in order.

At this time of year, it’s easy to feel the pressure of mounting paperwork and admin responsibilities.

Your recruitment agency will likely be in full swing with the juggle of temp and permanent placements, following up late paying customers, managing your team and operational duties all demanding your attention.

Across many industries – but especially in the recruitment sector – outsourcing back-office operations, including accountancy services, is more common than ever before.

What are the top considerations when assessing your recruitment agencies back office?

Don’t sign up to any back office system or software without a full review of how it can help your firm’s unique operational situation. Here are the key things to look for.

Staff and Customer needs

Work out whether electronic or manual timesheets suit the type of employee you deal with, the location you’re in, or industry you service. This will help you identify what type of back office support you need.

Understand your payroll complexities

Drill down to determine any variables in your payroll, such as the different awards which need to be considered for white collar versus blue collar placements, shift work versus contracting and so on.

Customer Payment Terms

Knowing how closely aligned customer payments are with your payroll cycle is paramount to plugging any cash flow gaps.

System Integrations

Make sure any back to back-office or service you employ seamlessly integrates with your existing systems – this includes your timesheets, payroll, invoicing and accounting. All of these areas must work well together for the smooth running of your agency.

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