With the shifting economic climate to use more outsourced labor, PMF Bancorp has noticed that Staffing Agencies have found their services to be more and more in demand in recent years. Companies have found that hiring temporary employees can help them avoid numerous pitfalls in terms of payroll taxes, human resources administration, and expensive health care costs. Nevertheless, although such demand appears to be a win-win situation for these agencies, it has raised a number of serious financial issues. Invoice factoring from PMF bancorp has helped to grow many of our staffing clients, and even one from zero to over $40 million in sales. PMF Bancorp is a lender that delivers the goods that you are looking for in terms of both service and reliability. PMF Bancorp provides the solution that a Staffing Agency needs by solving cash flow problems through Accounts Receivable Financing while providing the best in ongoing service.
The hidden cost to a majority of businesses is the non-productive administration of human resources. As a percentage of the average gross payroll, the U.S. Department of Labor and the Small Business Administration have estimated that employee administration expenses are upwards of 11% for small to mid-sized companies of 25 employees or less. For larger companies, the estimated cost is upwards of 7%. These figures take into account the cost and time involved in basic administration, payroll processing, workers? compensation and unemployment administration while keeping in compliance with the current plethora of employment regulations.
For Staffing Agencies, this cost becomes an overwhelming hurdle to overcome as they outsource more and more temporary and even permanent employees. With an average human resources cost of $832 per employee that comes out to $320 each business day per 100 employees, how is a Staffing Agency supposed to cover the costs when their Accounts Receivable tend to be paid at the end of each month at best. With temps, payroll has to be processed on a weekly basis, and the cash flow gap between money coming in and money going out can quickly become overwhelming.
PMF Bancorp understands the tough problems facing the staffing industry and can provide the invoice factoring and financial support needed to help manage growth, take advantage of opportunities, and help fund payroll. PMF Bancorp usually can perform all of the critical compliance requirements for about half of what the U.S. Small Business Administration requires due to economy of scale. In such situations, human resources help and factoring accounts receivable becomes the best possible solution.
The following testimonial from a Staffing Agency President is anonymous because PMF Bancorp always protects the privacy and confidentiality of our clients. The President of Industrial Staffing Agency described how working with PMF Bancorp truly helped his company improve and their bottom line improve. Industrial Staffing’s President expressed this perspective when he said: “We needed to get an expanded workforce mobilized immediately and PMF provided us with financing that helped us expand quickly to capture sales opportunities. PMF came through with the invoice factoring and financial support when we needed it most.”
The past 20 years have witnessed an unprecedented rise in employment litigation, labor regulations, and tax laws. Effectively managing human resources has become a daunting and expensive task for small to mid-market business owners like Staffing Agencies. The complicated system of employment laws has become a laundry list of unfriendly policies, including laws governing payroll processing, unemployment administration, and workers? compensation. PMF Bancorp can provide both the necessary funds and the experienced needed for a Staffing Agency to turn the positive shift in the economy into a truly win-win scenario across the board.