This May with the coming spring we are offering a profitability series that will help you grow your business while staying on track. Our first article is about the metrics you need to know.

You’re probably familiar with business guru Peter Drucker’s mantra: You can’t manage what you can’t measure. In other words, you can’t tell where you are in your goals if you don’t have data to let you know where you are and how far or close you are to targets.

Drucker’s concept applies to all businesses, but it particularly resonates with the staffing industry. It is one of the few industries that has sudden cycles, times when major growth is called for and other times when scaling back works. Here are some metrics every staffing firms should keep an eye on.

Gross Profit/ Gross Margins. Gross Profit is a company’s net sales revenue minus its cost of goods sold (COGS). The Gross Margin is a percentage where you divide the Gross Profit by Revenue.  Gross Profit represents the amount of sales revenue that the company retains after incurring the direct costs associated with producing the goods and services it sells.  This is a more important metric, than, sales revenue, which provides a wonderful “feel good” metric, but it tells you little about the strength of your particular staffing business. The reason is that sales revenues don’t account for all the differences in direct expenses from one customer to another.

At Madison, we can help you gather and analyze data the right way with our business intelligence service.

Indeed, Madison Resources is like having a financial planning and analysis department at your fingertips.

  • Trends on sales gross profit, gross margin, MU % and headcounts
  • Adjustable periods and comparisons with dropdowns for month, quarter or annual
  • Year over year or sequential comparison options
  • Customizable and available online 24/ 7
  • Branches and regions can be swapped for multibranch “what if “ analysis
  • Information is broken down into three separate sections: Income statement, balance sheet and cash flow for ease of use.


This ensures you not only have the right data, but you can see what it means. Margins are the top measurement for staffing pros, but there are many others that can help your business.

1. Mark-ups.

This is simple data but so important. This is the percent difference between your bill rate and pay rate. The higher the mark-up percentage, the more money you’ll have on your bottom line.

You need to monitor your mark-ups through internal data, customer feedback, and gleaning whatever information regarding what your competitors and colleagues may be doing. Market assessment is essential here.

The irony with mark-ups is that you may be doing great business but losing money through lost billing opportunities.

2. Time-to-fill.

This data … how long it takes you to place someone in a position is valuable because it gives you quick insight into the job your sales & recruiters are doing as a team.  If time-to-fill is haphazard across your team, you may have some serious operational issues.

Time-to-fill is also a great way to ensure customer satisfaction. Once you’ve got measurements about how quickly you fill certain jobs, you can help the client by managing hiring expectations. It also offers them transparency into your process, which will bring you closer together.

3. Client Satisfaction.

Time-to-fill is key for client satisfaction, but there are other measures as well. You can institute customer satisfaction surveys. Another measurement, of course, is repeat business. Staffing pros value this metric because it points to your business health and overall performance.

4. Candidate Satisfaction.

There is a proven disconnect between the job recruiters think they are doing, and the candidate experience. Add to that that some studies show that only 2 out of 5 staffing firms measure candidate satisfaction, and you can see how there could be improvement opportunities. But data can help you here as well. Candidate satisfaction isn’t just about measuring the results, however. You can use your data in your ATS/CRM to proactively make changes to your process and ensure a higher rate of satisfied candidates.

Are you looking for a strategic financial partner?

These are some key metrics to give you insight into your business, and help you navigate the rest of the year in efficiently. Give us a call at Madison today so we can discuss ways to make sure that what you measure gets managed.



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