Start a new revenue stream by building your temporary or contract division from your existing direct hire or executive search business. Stay current with the marketplace and in front of your competition by introducing different alternatives to both your applicants and your clients. You will benefit in multiple ways by expanding into the ever-growing contract market. Make it a positive alternative to a direct- hire by offering a temporary or contract placement as an interim, income-producing, solution.


When offering alternatives, present multiple options for your client to choose from. No one way fits every client. Your clients will appreciate your willingness to work with them on different levels. If you are working on a long-term search, offer a contract person to fill the gap until you have the right long-term solution. If your client has a project which needs to be done but does not have the direct-hire fee in the budget, offer a contract solution for the interim period. Solve your client’s problem by becoming a valued partner for the long run.


Make the transition from temporary or contract placement to direct-hire seamless. Let your clients try a candidate out for 30 to 60 days and have a conversion fee at the end of the trial period. Offer the opportunity to both your sales and recruiting calls. Ask your candidates whether they will accept a temp or contract position while waiting for a long-term assignment. Also offer the option of a temp or contract placement to your clients as an interim solution. Make it a habit in your daily phone calls to ask if this is an option. Both your clients and applicants will appreciate having a choice in order to make a successful decision. Make sure everyone is happy with the move!


Partner with a third-party vendor to start with. Look for companies that offer employer-of-record services with full back-office support. Some of their responsibilities will include onboarding your candidate, providing and collecting weekly time worked, funding and producing payroll checks, making federal and state tax returns, covering workers’ compensation and other insurance requirements, and issuing W-2 forms at the end of the year. You do not have to take on all these responsibilities yourself, it is better for you to focus on your core business: matching the candidate to the job.


Know how much it will cost you before you make an offer. Your client will need to know that their cost will cover the employee’s pay, state and federal unemployment, workers’ compensation, and any required benefits for the employee. You will need to know how much you need to pay your candidate, what state the employee will be working in, the employee’s home state, the Workers’ Comp Class Code and how much profit you would like to make before you give a bill rate. Your third-party vendor should help you calculate your bill rate based on these facts.


Start small and grow. Experiment with a few temporary or contract placements to get the feel of the market and to develop your technique. This experience will be your INTRODUCTION TO SUCCESS in the temporary and contract market!

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NAPS Harold B. Nelson Lifetime Achievement Award Winner