How to Sell when Someone Says, “We’re not hiring.”
Unless you’ve been lying under a rock the past 90 days, you’ve undoubtedly noticed the market for staffing services has taken a turn for the worse. And with the absolute chaos in the financial markets, the bad news just keeps spreading.
But who cares about bad news? Bad news does not inspire or motivate. Bad news does not create profits. And, if you allow your team to get overly focused on bad news, you can turn bad news into an excuse for bad performance.
So rather than dwell on the negative, let’s look at some positives, and more specifically what you can do to sell more of your services right now.
“We’re not hiring”
The one thing that’s certain about bad news in the economy is that employers get scared. They pull back on investments in technology, marketing, and of course, talent. And while you know that reducing spending in the areas that drive your revenues doesn’t make sense, that’s still what companies do.
The bottom line: “We’re not hiring” is a phrase you’re going to hear a lot of in the coming months (and maybe longer).
So what can you do?
The typical reaction to a slowdown in the staffing industry is to make more cold calls. Push harder. And beat the tar out of our sales reps. Well, that can work…at least for a little while. But it is also a recipe for frustration, burnout, and often failure.
Don’t get me wrong…you do have to sell harder. But just doing more transactional selling is likely to yield very few positive results in most sectors of the staffing industry. And if the last few downturns are any indication, many of the companies that failed did two things: stuck with old school transactional selling and cut their prices.
If you want to survive, you have to think smarter.
Step 1: Stop being reactive
Usually, when I teach classes on marketing staffing services, I tell the audience that “We’re not hiring” is one of the three great lies told by HR managers. But today, it’s not a lie. Our clients are not hiring, and if your sales people are waiting for hiring needs to open up, they may be waiting a L-O-N-G time.
As an experiment, go out in the field with your sales team for a day or two. Or listen to their prospecting calls. See how many times they are asking the age old questions like, “Do you have any hiring needs?” or, “When does your company use temporary staffing?”
These are reactive, transactional sales questions. They work fine when the volume of transactions is high, but when orders are hard to come by, the old standby sales process will not work. You cannot force a sale in this economy.
Step 2: Go back to Sales 101
Almost any sales trainer will tell you that the key to selling is to find the prospect’s pain. Right now, your clients don’t have the “we need people” pain. But they do have lots of other pains. They have the “we have to cut costs pain” and the “I’m terrified that I’m going to lose my job” pain.
Now is the time to do more homework. Get to know your clients’ businesses better than they do. Understand what’s going on in their industry. And most importantly, understand the impact the current financial crisis has on their businesses.
Take your best clients to lunch for a heart to heart to see what fears are keeping them up at night. Have executives in your organization contact executives in your clients’ firms to schedule business review meetings.
The concept here is simple. The more you know, the better solutions you can offer. And the silver lining in all this economic bad news is that the pain we feel can be an outstanding opportunity to sell staffing (more on this in a minute).
Step 3: Find ways to drive out cost
Some of your clients are seeing a mild slowdown. Others are hemorrhaging cash. And for almost every business (except maybe those in the energy industry), there is a universal cry to cut costs.
If you’re stuck with reactive, transactional selling, this cry will impact you in the form of greatly reduced margins. HR and purchasing departments are pushing staffing firms to ridiculously low prices…and completely unreasonable terms of service.
But cutting your price is rarely the best way to help your clients reduce their costs. Consider these ideas:
- In any business, no employee is 100% productive. In fact, most companies are lucky to get more than 50% of an employee’s time to be spent on real productive work. Now consider the cost of that lost productivity. If you have an FTE who earns $50,000 and they are only 50% productive, that’s like having a $100,000 employee for each actual hour worked. The beauty of temporary and contract staffing is that the people you supply are typically productive 90% or more of the time. They don’t get sucked into all the meetings, email and water cooler conversations. Converting low productivity FTEs to temporary and contract labor can be an enormous cost savings.
- Despite the downturn, benefits costs continue to skyrocket. For many of your clients, the cost of a temp with your mark-up will be equivalent to or less than a fully costed employee. Again, switching from FTEs to temps for certain job functions can reduce the total cost of employment.
- With the business slowdown, many organizations don’t need some of their people in full-time roles. Converting to a flexible staffing model, and using more on demand labor, gives your clients the ability to better adapt to market conditions while substantially lowering labor costs.
Now, none of the above ideas are an easy sell. You are talking about firing full-time employees and replacing them with temporaries. And you’re going to run into a lot of resistance, but the financial model is incredibly compelling. Your ability to deliver flexible staffing solutions and higher productivity allows you to provide labor at a far lower cost.
Your challenge is going to be two-fold. First, you have to educate your staff. Sit down with your team and brainstorm ideas for helping your clients reduce their total cost of labor. Look at productivity issues. Look at personnel administration costs. Look at overtime and benefits expenses. And analyze each of your clients’ staffing models to discover opportunities for helping them reduce their costs.
Next, you have to educate your clients. You will need to build financial models that demonstrate the economic value of staffing to decision makers. You’re going to need to understand “employment math” backwards and forwards, so that you can prove the business case to the CFO, COO and any other CO who will listen. You’re also going to need an effective way to reach these people…and of course, that’s one place Haley Marketing can help, but I won’t make a sales pitch in this article.
Step 4: Capitalize on opportunities
In this article, I have intentionally avoided discussing hot sectors in the staffing industry. They are out there, but I’m not going to discuss them here. This article is solely dedicated to selling staffing to the people you already sell to.
But finding hot opportunities…and exploiting them…is something your clients need to do. And very likely, they do not have the staff to do it right now.
So how can you help?
If you’ve really done your homework, you are going to recognize opportunities for growth in your clients’ businesses. In fact, as an outsider you may be able to spot opportunities where those inside the business can’t. And even if you don’t see growth opportunities, you can simply ask your clients, “If you had the right resources at your disposal, what strategic initiatives would you pursue right now?” The response to this question will give you a lot of insight into your clients’ needs and hot buttons.
Once you’ve identified potential opportunities for growth, then you have to show your clients how you can provide the talent to allow them to capitalize on these ideas with minimal financial risk. For example, here are just a few of the ways you can help your clients use staffing to grow their businesses:
- Encourage the use of temporary help to free key executives to focus on strategic priorities. I recently read a quote that most Fortune 500 executives spend less than 40 minutes a day on productive work. Imagine the value if you could free an extra hour a day of their time…and you can by providing the right support staff.
- Many organizations are being stretched so thin that they do not have the intellectual capital available to pursue new opportunities. One solution is to show leaders in these firms how you can provide exceptionally skilled contract staff. As you know, thanks to the situation in the job market, many talented people are looking for work. And you can provide these people for far less than the cost of hiring traditional consultants. You can become a supplier of on demand expertise.
- Help your clients sell more. Whether you provide contract sales people, telemarketing services, product demonstrators, or on demand marketing support, you have the opportunity to help your clients temporarily expand their business development capabilities with less cost and less risk than hiring additional staff. While they may not have planned a need to hire, if you can show them how you can provide proven business development professionals, you may be able to create demand for your services.
Step 5: Strategic Recruiting
Some of your clients won’t be able to hire now, no matter how compelling the case you present. But they still will need talent at some point in the not too distant future. For these organizations, it’s time to talk about strategic recruiting. While you may not sell much (or anything) in the short-term, you may be able to create a backlog of future business by helping your clients plan for future hiring needs and proactively source and nurture a talent bench for those hires. You might even consider offering a “for fee service” to do the candidate research, assessment and relationship nurturing.
There is no easy solution
I hope you have found inspiration in the ideas in this article. But please be aware that none of these strategic approaches to selling staffing will be easy. It’s hard to change the perception of “we’re not hiring.” It’s hard to sell new investments to businesses that are hurting. And it’s impossible to sell any of these ideas if the only people you are talking to are the HR coordinators who are not empowered to think strategically.
While it looks like we’re in for a long, tough haul in the staffing industry, there are opportunities out there. And your firm can prosper tremendously by finding ways to exploit them. Be smarter. Be faster. Be more aggressive.
Good luck, and let us know if you’d like our help.