As your business grows, you will be juggling different workers, timesheets, contracts, and invoices. To retain your bank of dedicated candidates, you need to efficiently manage your funds to ensure wages are paid on time and any issues are promptly dealt with. Here are 5 ways to help boost your cash flow in your recruitment agency.
Choose the right Finance Partner
It’s often 6 or so weeks before a client invoice is settled and the impact on cashflow in this time -period can be detrimental if you don’t have the funds to cover your worker’s pay.
Finding the right Recruitment Finance solution for you is essential. A specialist finance provider can provide your new business with 100% of your gross profit each week.
The benefits of using a specialist finance provider:
- Processing your payroll, paying your candidates, raising your invoices, collecting payments from your clients and paying you your profits
- Offering your business favourable credit and funding limits, specialist finance providers have an extensive knowledge of the recruitment industry
- Flexible funding will give you greater freedom to develop your new agency
Managing your funds and ensuring you have enough cash to meet any outgoing costs is crucial. For temporary agencies the need to pay agency staff on a weekly basis can often be the biggest expenditure.
To gather how much you need to budget for each month, you first need to understand your outgoings and incomings.
Your budget should record all outgoings to give you a total of how much you require each month, including:
- Business overheads i.e. Building/office rent, bills
- General business expenses i.e supplies, marketing, equipment, office phones
- 3rd party tools i.e back office or payroll software/services
- All internal and external payroll costs i.e. insurance
Provide on-time and accurate timesheets
Whatever process you use for collecting timesheets, whether that’s via a third-party software, or even paper timesheets, you need hours accurately imputed and signed off after each shift.
Failure to do this can also cause a delay in the processing of workers hours/pay, risk clients getting invoiced incorrectly, workers sick pay potentially being missed and so on.
Get your invoices paid on time
Depending on your arrangement, your financer may chase the invoice for you, however you still need to invoice the client and hand over the details of the invoice to your financer.
By agreeing clear payment terms, making your invoice clear and accurate, including the correct bank details, and by sending the invoice to the correct person in the business, will all help to ensure prompt payment.
You should also carry out the required due diligence before supplying to a client, this will quickly inform you whether the company has good credit and can be a good customer.
If you work with a payroll management company, or alongside your financier’s in-house credit team, they usually will offer a credit check and the appropriate due diligence as part of their service.
Consider investing in an all-in-one specialist recruitment package
A complete package designed to fulfil your back office and funding needs streamlines your entire administrative workflow.
The best specialist providers offer:
- Support and guidance from experts that know the industry and its challenges
- Industry specific software
- Software that manages your admin tasks while keeping you compliant
- A provider using a secure cloud-based system will make regular software updates and as well as supplying valuable support – providing security
Whether its software, payroll, funding, or back office administration, FullFlo has it covered.
From managing bookings and processing timesheets to training and support, we know that all the details in your business matter. Our back office offering also allows you to relax about all those time-eating administrative things – from cash flow to changing legislation, compliance management, credit control and HMRC reporting.
Our pay and bill-engine gives customers both transparency and security, allowing you to see that your invoices are being managed, sent and received on time, in line with client requirements and as an extension of your brand. We also make sure that the back office part of our FullFlo offering is an ‘open house’ for our clients.
If you would like to learn more about how Flo can help support your new temporary recruitment business, you can contact us on 01827 438065 or email@example.com