How to start an on-demand staffing agency

Starting your own on-demand temp or staffing agency can be a great way for entrepreneurial people to participate rapidly growing world of temporary staffing. On-demand staffing agencies provide temporary workers on a short notice, filling gaps in their clients’ workforce needs, and both provide employers with a flexible workforce that can be easily scaled up or down depending on the current volume of work.

On-demand temp workforce

Starting an on-demand temp agency can be a challenging but rewarding endeavor. Some of the challenges you may face include:

Finding and retaining qualified temps

One of the biggest challenges of running an on-demand staffing agency is finding and retaining qualified staff. You’ll need to have a steady pool of workers who are able to fill a variety of different roles on short notice. This can be challenging because you need to have a pool of workers who are flexible and able to adapt to different environments and tasks quickly.

Additionally, you may need to find staff who are willing to work irregular or unpredictable schedules, which can be a challenge for some people.

You may not have the opportunity to thoroughly vet and train your on-demand staff before they start working, as you would with a traditional employee. This means you’ll need to be especially diligent in screening and selecting the right people for your agency. You’ll also need to have systems in place to provide your staff with the necessary training and support once they start working.

Managing client expectations

It’s important to set clear expectations with your clients and to be able to deliver on your promises. This can be challenging if you’re not able to find the right staff for a particular job or if you’re not able to fill last-minute requests.

Clients may have unrealistic expectations about the availability of staff, the speed at which staff can be mobilized, or the skills and qualifications of the staff that are available. Additionally, clients may have specific requirements or preferences that can be difficult to accommodate, especially if the pool of available staff is limited or if the client’s needs are particularly specialized.

They may not always be aware of the constraints and limitations that the staffing agency is working under, which can make it difficult to manage their expectations and meet their needs. Therefore it is important for on-demand staffing agents to be transparent, communicative, and proactive in managing client expectations in order to maintain good relationships and provide high-quality service.

Dealing with legal and regulatory issues

There are a number of legal and regulatory issues to consider when starting an on-demand staffing agency, including employment laws, taxes, and insurance.

The main challenge is to determine the employment status of your workers. In many jurisdictions, there is a distinction between employees and independent contractors, and it is important to correctly classify your workers in order to comply with relevant laws and regulations.

Misclassifying workers can result in significant legal and financial consequences, including fines, back pay, and other damages. It can also create risks for your business, as misclassified workers may not be covered by workers’ compensation or other employment protections.

To avoid these issues, it is important to carefully assess the nature of the work being performed and the degree of control and direction you have over the worker. Factors that may be relevant in determining employment status include the level of skill required for the job, the degree of independence and autonomy the worker has, and the extent to which the worker is integrated into your business.

It is also important to be aware of and comply with any applicable laws and regulations related to the hiring and employment of temporary or contract workers, such as requirements for contracts, pay and benefits, and working conditions. It may be helpful to seek the advice of an attorney or other legal advisor to ensure that you are in compliance with these requirements.

Marketing and advertising

You’ll need to effectively market and advertise your agency to attract both clients and staff. This can be a challenge, especially if you’re competing against established agencies.

Clearly defining the types of clients and workers you want to attract will help you tailor your marketing efforts to their needs and interests. Look for ways to differentiate your agency from competitors by offering unique services or benefits, such as specialized training or support for workers, or customized staffing solutions for clients. Encourage satisfied clients and workers to recommend your agency to others, and consider implementing a referral program to reward them for doing so.

It may be helpful to work with a marketing professional or agency to develop and implement an effective marketing strategy.

Managing finances

Managing the financial aspects of an on-demand staffing agency can be complex, as you’ll need to account for a variety of expenses, including payroll, taxes, and insurance. You’ll also need to be able to accurately estimate and bill your clients for your services.

The biggest challenge here is the unpredictable nature of your income. Because on-demand work is often project-based and may not be consistent from week to week, it can be difficult to budget and plan for the future. Additionally, you may also face challenges around tracking and paying taxes on your income, as well as finding and accessing financial services that are tailored to the needs of gig economy workers.

To manage your finances effectively as an on-demand staffing agent, it may be helpful to set up a system for tracking your income and expenses, establish a budget, and find ways to save and invest for the future. It may also be a good idea to seek the advice of a financial professional, such as a financial planner or accountant, who can help you navigate these challenges and develop a financial plan that works for you.

Staff management

Your staff is the key to your business success. By keeping them informed, providing them with the support they need, and fostering a sense of teamwork, you can improve productivity, enhance your relationship with your clients, and increase customer satisfaction.

As an on-demand staffing agency, your level of service highly depends on the quality of people you send over to work for your customer. Establishing excellent communication and scheduling rules with your staff is of the utmost importance, as well as having a feedback process in place for anything that doesn’t go as planned.

If you’re looking to start a on-demand staffing agency, take a look at our shortlist of the best on-demand staffing apps, or jump directly to our free on-demand staffing app. It’s a task dispatch application, built with on-demand teams in mind – a perfect tool for getting the right people on your team to the right job – in a blink of an eye.