SI Review: June 2012


Power Seller

The 5% Rule

Understanding this rule will boost your productivity

By Steve Harari

Any staffing industry insider knows that the biggest decision you can make is where to allocate your time. Whether you work for a two-person staffing firm or a multistate operation servicing hundreds of clients, you have choices to make every day. Working on what is “convenient” or “fun” may not always be best for the business. Similarly, spending all your time responding to requests from others is not generally going to advance your field position. Every staffing firm employee needs to sell in one capacity or another, and understanding the “5 percent rule” is an important part of this.

Only about 5 percent of new hires come from a staffing firm. Staffing firms should be structured to make the most of that 5 percent. Although the exact figure fluctuates, the vast majority of new hires can be traced to referrals, job boards, corporate job sites and direct sourcing by in-house recruiters. Larger clients may utilize sophisticated managed services as well as VMS systems to control their spend level. All clients, however, have a financial incentive to place new hires without paying a fee to a staffing firm. Successful salespeople in staffing understand this instinctively and position themselves as a value-added resource to their clients. They know how to maximize that value. But how do you expand your area of influence?

The path less taken. The reality is that a combination of factors including business conditions, volume of open reqs, required skill sets and in-house familiarity with the new position often dictate whether a position is eligible for agency submitted candidates or not. If uncover opportunities that are unique. Sometimes, getting off the beaten-path is a wise investment.

Consider especially spending time with small to midsize businesses (SMBs) — those with $10 million to $50 million in revenue. Companies in this category produce a disproportionately large share of new jobs. SMBs also are less likely to have in place existing MSP/VMS systems, which can limit the opportunities for a staffing provider.

Dig deeper. Relationships with HR staffers can be very useful, but HR departments don’t drive new requirements. You want to build relationships with hiring managers who will know weeks or even months ahead of time that they are going to be expanding in a given area. It’s not hard to find hiring managers, as they live in your community and participate in the same schools, clubs and religious organizations as you. Position yourself as a resource to these people (rather than as a salesperson) and then do just that. Bring value to them either in terms of information or exceptional service. Such a relationship may give you the inside track on positions which are eligible for agency participation.

Expand your reach. Technology has leveled the playing field in many ways, enabling smaller firms to look larger than they are. A professional-looking website that is intuitive for clients and candidates to use will go a long way toward building your market visibility. Be active on social media in a way that builds your professional brand. Participating in industry trade associations and accepting speaking engagements will boost your reputation and set of opportunities. Be generous with your business cards and let people know what you do for a living. Learning about that new job posting a week before it is posted can make a world of difference!

Identify pain points. Figure out what your client most needs help with. (Your relationships with the hiring managers come into play here.) Is there a mission-critical project that is looming on the horizon that will need to be staffed? Can you provide up-front consultation that will help the client become better prepared? Are you willing to roll up your shirt sleeves before there is an open req sitting on the table? Which recruiter will the client think of first when a new emergency requirement is identified at their off-site retreat? Your ability to identify and assist with pain points with a high potential client can position you for future business. Don’t let up at that point, however, successful sellers work even harder once they are on the inside.

Steve Harari is CEO of Staffingbook. He can be reached at


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