Category: Business

A Simplified Staffing Business Model

In much the same way Amazon and eBay have helped many get their start in starting, developing and running an e-commerce business, this same help is now available in starting a staffing business.

There are now well over two million third-party sellers on Amazon. The infrastructure that is on Amazon and eBay is plug_ and_ play for all who try and claim their stake on these selling platforms.

With this in mind, the traditional route for those seeking an opportunity to start their own staffing business included the need for a large capital infusion, a payroll system, access to high-cost worker’s compensation insurance and many other costs that were prohibitive for most to enter the industry.

For many who do have the resources to enter the staffing industry, they often turn to high-cost franchise staffing companies who enjoy a large slice of earnings for the lifetime of the business. This relationship can grow strained over time and at some point the operator may feel they are contributing more to the franchise than the franchise is contributing to the operator. When this occurs, the separation from the business can grow messy and can even end in litigation.

The simplicity of both Amazon and eBay and their policies are a big draw for many who are looking to sell products online. There are no long-term agreements or costs that can easily cripple a new business. Being able to be flexible in a new venture is always a great asset and both these platforms allow for it.

This flexibility platform is now available in the world of staffing and has over 150 firms using this unique business model to grow impressive sized businesses with many reaching over a million in first-year billing. With over half a billion under management in less than 10 years in operation, one can see this is becoming a great alternative to going it alone or entering into a long-term agreement with a franchise.

What you get on the platform:

  • Worker’s compensation insurance with no liability to the operator.
  • An unlimited funding source for all payroll and client billing.
  • A complete back-office for all management and personnel needs.
  • Access to professionals with over 40 years of staffing experience.

With all the boxes checked, this platform can be summed up as the Amazon or eBay of the staffing industry. If mitigation of risk is high on your list for starting a sustainable, prosperous business there are few options that can match what is now available.

Benefit and Drawback of Franchise Opportunities

While considering franchise business, it is crucial to know that you are actually into the selling process. If you are good at sales, franchisors will definitely go to sell you on their systems, and you will work with sales executives who usually get the commission to generate lead to enter into franchise agreements. When we talk about European franchisees, several laws are to be taken care after. In fact, every small detail from the readiness of understanding to working with money-related information is to be deliberately recorded in an agreement.

In between sales process, you will always hear about the several benefits that each franchise system has to offer. But in many situations, these systems have limitations too. Let us understand this with some examples:

Benefit or Drawback of Franchise Opportunities

1. Designated Suppliers

It is highly desired for the franchisors to ask their franchisees to buy the product only from selected suppliers; this case is valid only for product-based franchises that offer products and services. The benefit of asking the franchises to make a purchase from the designated supplier is to deliver the same services and products to the customer and also to reduce the burden of sourcing the product.

On the other hand, the drawback with designated supplier option is to make delay in delivery or what if it’s provided products do not meet the client’s expectations. If you are tied in contract with the franchisor and unable to find a possible solution of this then these could create a big problem for you and your business in future. In that case, a franchise agreement lawyer can give a solution to this problem.

2. Advertising Funds

A centralized advertising fund in a franchise system can provide benefit for the right franchisees. But, wait a minute, to consider few things before contributing an amount of your income. It means, in a typical franchise agreement which is generally created by a franchise agreement lawyer, franchisees are not given any benefit on their contributions. If the franchisor thinks it can generate a good amount of revenue by concentrating its marketing efforts in a particular region even if your franchise is located somewhere else, you will hardly notice any postings that are targeting your region.

Moreover, franchisors always reserve the right to use the franchisees’ part for administrative expenses and advertising funds are never operated with transparency.

3. Franchise Territories

If in case, a franchisor is offering franchise territories, it is crucial to understand what does franchise territories mean. Usually, different franchisors give rights of different territories, based on their geographic reach with the uncertainty of exclusivity.