business plan staffing

Staffing Agency Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

• Staffing Agency Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Start Your Staffing Agency Plan Here

You’ve come to the right place to create your staffing agency business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their staffing agencies.

Below are links to each section of your staffing agency business plan template:

Next Section: Executive Summary >

Staffing Agency Business Plan FAQs

What is a staffing agency business plan.

A staffing agency business plan is a plan to start and/or grow your staffing agency business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your staffing agency business plan using our Staffing Agency Business Plan Template here .

What Are the Main Types of Staffing Agency Companies?

There are many types of staffing agency companies. Some staffing agencies will focus on a particular industry, such as clerical jobs. Other staffing agencies focus on executive job placement, while others will offer a wide range of services across all industries. Some even offer human resource functions, such as payroll, benefits administration and risk management.

What Are the Main Sources of Revenue and Expenses for a Staffing Agency Business?

The primary source of revenue for staffing agencies are the fees it charges clients to place them in a job and the revenue it receives from businesses that hire them to find and recruit suitable staff for their business.

The key expenses for a staffing agency business are the costs to market the business, as well as payroll for the support staff. Other expenses will be the rent, utilities, and overhead costs for the physical office space.

How Do You Get Funding for Your Staffing Agency Business Plan?

Staffing agency businesses are most likely to receive funding from banks. Typically you will find a local bank and present your business plan to them. Angel investors and other types of capital-raising such as crowdfunding are other common funding sources. This is true for an employment agency business plan and specialities like a healthcare staffing agency business plan.

What are the Steps To Start a Staffing Agency Business?

Starting a staffing agency business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Staffing Agency Business Plan - The first step in starting a business is to create a detailed staffing agency business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your staffing agency business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your staffing agency business is in compliance with local laws.

3. Register Your Staffing Agency Business - Once you have chosen a legal structure, the next step is to register your staffing agency business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your staffing agency business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Staffing Agency Equipment & Supplies - In order to start your staffing agency business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your staffing agency business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful staffing agency business:

• How to Start a Staffing Agency Business
• How to Open a Staffing Agency Business

Where Can I Get a Staffing Agency Business Plan PDF?

You can download our staffing agency business plan  PDF template here . This is a business plan template you can use in PDF format.

How to develop a staffing plan

Lucid Content

Reading time: about 8 min

Your employees are one of your greatest assets. However, too often, organizations struggle to manage their human resources and plan for the future. In fact, according to a survey from the Society for Human Resource Management, 43% of HR professionals say human capital is the largest "investment challenge" for employers. 

Plagued by turnover, skills gaps, over-employment, low productivity, and ever-changing business landscapes, it’s no wonder that businesses are struggling to keep up. But these issues can be mitigated with a strategic staffing plan. 

Use the following tips to learn how to develop a staffing plan that puts the right people in the right place at the right time. 

What is a staffing plan?

A staffing plan answers the questions: 

• What work needs to be done?
• How many people do we need to employ?
• What skills and experience are necessary to do this work?
• What skills gaps need to be filled (and are there any areas of redundancies)?

Staffing plans can encompass the entire company or apply to smaller teams or departments and even individual projects. 

For example, if your company’s business goals focus on expanding its salesforce in the coming year, a staffing plan can help prepare the sales department for that growth—so that the right people with the right skills are brought on board at the right times. 

Additionally, a staffing plan helps your business to:

• Reduce labor costs and maximize productivity.
• Eliminate skills gaps.
• Increase employee engagement.
• Increase employee retention and reduce turnover.
• Improve customer experience.
• Streamline business growth.

Having a clear staffing plan helps prevent issues that could delay growth or hinder the quality of your products and services that could result in unhappy customers and lost business opportunities. 

Not only do staffing plans help companies effectively recruit, hire, and develop employees, but they also help guide budgeting and financial decisions within the organization. 

How to calculate staffing needs

A staffing plan involves three main steps:

• Determining current staffing levels 
• Forecasting future staffing needs
• Identifying the gaps between the two

Once you’ve assessed your staffing needs, you can outline recommendations for how to address those needs, which might include recruiting and hiring new talent, promoting internally, focusing on training and employee development, or adding contractors to your staff. These forecasts and recommendations will help you develop your overall human resources plan for the organization.

Use the following steps to learn how to calculate staffing needs and make a plan for the future.

1. Identify the business goals

Before you dive into staffing plans and changes, you need to know what the overarching goals are for the business. These goals are typically outlined in a strategic business plan. Use this plan to clarify the company’s objectives and align the staffing plan accordingly.

What you do with your staff will affect business outcomes (for better or for worse), so you want to make sure the two plans align.

For instance, if the business plans to open a new location, you may need to move current staff around or hire new employees to fill those roles. The business plan will help inform those staffing decisions.

2. Determine your current staffing situation

To develop a staffing plan, you must first understand your current staffing environment.

If you have a robust HR database, this step could be reasonably straightforward. However, if you host personnel information on multiple sources, you will first need to consolidate that data into one source of truth. Work with business leaders and managers to help you ensure accurate and complete data on your human resources.

Once you have your staffing data in one place, you can assess the current staffing environment and begin to pull actionable insights from the data.

Pay particular attention to:

• The number of people on staff
• Staff distribution (team size and who works where)
• Skills and competencies within the workforce
• High performers and potential leaders 
• Low performers or “flight risks” who could indicate turnover
• Staff age and tenure (to anticipate retirement numbers)

Pulling out these data will help you better understand the current staffing landscape and more accurately identify staffing needs and opportunities down the road. 

Lucidchart can help you assess your current staff to glean new insights. Import employee data directly into Lucidchart to build an org chart or group employees in Smart Containers by role, competencies, performance, etc. Visualizing your workforce can help you identify important relationships, correlations, or gaps in the staffing.

3. Forecast future staffing needs 

After you assess your current staffing landscape, it’s time to make some predictions about your future staffing needs. 

As you conduct your staffing needs assessment, you will want to consider the factors that can affect staffing decisions and opportunities, including: 

• Business goals 
• Turnover rates and projections
• Expected mergers or acquisitions
• New product launches
• Business investments (e.g., new technology) 
• Changes in the economy
• Competitors attracting key talent 
• Industry labor costs
• Unemployment rate 

All of these internal and external factors can influence the workforce and your staffing needs. 

While forecasting will always involve some guesswork, you can make confident, educated, (and more accurate) predictions using the following methods.

Trend analysis

Trend analysis works well for established businesses with several years under their belt. Trend analysis uses historical data (i.e., past experience) to inform future needs. 

To perform a trend analysis, start by gathering historical data. Focus on gathering information for at least the past five years—but you may want to go back as far as 10 years. (Keep in mind that the larger the sample size, the more accurate the results.)  

Collect data on the following: 

• Hiring and retirement patterns
• Transfers and promotions
• Employee turnover
• Years of service
• Employee demographics
• Skills and qualifications
• Past work experience

Once you have collected the data, you can analyze it to understand turnover rates over time as well as to discover trends or patterns between the data sets.

Ratio analysis

A ratio analysis is a dual-purpose forecasting method that both predicts staffing demand and compares forecasting results against an industry standard. 

The beauty of the ratio analysis is that it doesn’t rely on historical data to predict future demand. This is an advantage for younger companies who don’t have the benefit of years of historical data to provide insight into future trends. 

Here’s how it works.

A ratio establishes a relationship between two things. A business can calculate ratios between business factors like future sales revenue predictions and staffing requirements. 

For example, let’s say your business plans to expand its sales in the coming year and predicts sales revenue at $500,000. You’ll need to estimate how many sales employees you will need to support that growth. 

To calculate this, you need to determine the ratio between sales revenue and staff. To do this, divide current sales revenue by the current number of sales employees. If the ratio is 50:1 (with 50 representing $50,000 in sales), that means a sales revenue of $500,000 would require 10 employees. 

Once you have that ratio, you can then identify gaps in your staffing. For instance, if you plan to increase your sales revenue to $500,000 but currently have only five employees, you know you will need to hire five more people to support that goal. 

4. Do a gap analysis

With your current and future staffing assessments complete, you can compare the two reports for gaps. In other words, look at where your staff is now and where it needs to be. What discrepancies are there? Do you need more staff? Are there skills missing from your current workforce that you will need in the future to meet your business goals?

Note any gaps between the two assessments.

As you go through this process, our skills supply and demand chart can help you determine how many current employees and job candidates have the skills you need and whether you should hire or train to gain those competencies.

Make sure that your workforce has the skills and experience required to meet company goals. Learn how to conduct a skills gap analysis.

5. Make a staffing plan

With your staffing needs analysis completed, you can now make a plan. 

Your staffing plan might include recommendations to implement a corporate training program to address skills gaps or to develop succession policies to streamline handoffs following retirements or promotions. 

During this process, work with the business’s leaders to create a strategic action plan to address staffing needs that aligns with the organization’s goals, culture, and mission. 

Learn how Lucidchart can help your organization plan for the future and hire employees with the right skills.

About Lucidchart

Lucidchart, a cloud-based intelligent diagramming application, is a core component of Lucid Software's Visual Collaboration Suite. This intuitive, cloud-based solution empowers teams to collaborate in real-time to build flowcharts, mockups, UML diagrams, customer journey maps, and more. Lucidchart propels teams forward to build the future faster. Lucid is proud to serve top businesses around the world, including customers such as Google, GE, and NBC Universal, and 99% of the Fortune 500. Lucid partners with industry leaders, including Google, Atlassian, and Microsoft. Since its founding, Lucid has received numerous awards for its products, business, and workplace culture. For more information, visit lucidchart.com.

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Building an Effective Staffing Plan: A Step-by-Step Guide

• Written by: Rinaily Bonifacio
• Last updated: 30 May 2024

In this article, we’ll help managers and employers understand what a staffing plan is, why it’s essential, and how to implement one efficiently.

Table of contents

What is a staffing plan?

Why your business needs a staffing plan, what are the steps to creating a staffing plan, what is a staffing management system.

A staffing plan is a roadmap designed by HR professionals to help businesses anticipate their future staffing needs and manage their workforce accordingly. It involves assessing current employees, identifying gaps in skills , and analyzing both internal and external factors that could impact staffing.

This strategic approach ensures that the company has a sufficient number of staff with the right skills to meet ongoing and future business objectives . The plan not only considers how many employees are needed but also focuses on other aspects like succession planning, skill development , and aligning human resources efforts with overall business growth.

It acts as a blueprint that guides the HR department through recruitment , training, and retention strategies, helping to predict future demand and manage labor costs effectively.

Having a staffing plan is more than just an administrative act; it’s a strategic component of human resource management . Here’s why every business should have one:

Align staffing with business goals:

A staffing plan aligns your human resources with your business goals. By using historical data and forecasting methods, HR professionals can predict future demand for skills and prepare accordingly. This alignment helps ensure that your business has the workforce needed to support future growth and objectives.

Anticipate and fill skills gaps:

Through skills gap analysis, a staffing plan helps you identify gaps between the skills your current employees have and the skills your business will need. This proactive approach allows for targeted training and recruiting, ensuring your team is well-equipped to handle upcoming challenges.

Control labor costs:

Effective staffing planning helps you optimize your workforce. By understanding your staffing needs, you can avoid understaffing, which can lead to overtime costs, or overstaffing , which can inflate your payroll unnecessarily. Strategic staffing helps maintain balance and reduces financial waste.

Manage business and HR risks:

A staffing plan takes into account various business factors and internal and external influences that can affect your staffing needs. This foresight helps mitigate risks associated with sudden changes in the market or industry, ensuring your business remains resilient and adaptive.

Support succession planning:

Staffing plans are integral to succession planning. They ensure that you have a pipeline of talent ready to fill key positions as they become vacant, either through unexpected departures or planned retirements. This planning is crucial for maintaining continuity and stability within your company.

Creating an effective staffing plan is crucial for aligning your workforce with your business strategy and future needs. This detailed guide walks you through each step, ensuring your staffing efforts support your company's objectives and help you manage your human resources efficiently. Let's delve into these essential steps.

Step 1: Assess your current workforce

The first step in creating a staffing plan is to conduct a thorough assessment of your existing staff. This involves analyzing the skills and performance of your current employees to identify any gaps between their capabilities and the business's needs. Workforce analytics plays a pivotal role in this process, providing data-driven insights that help you understand your current staffing landscape.

How to assess your current workforce?

Conduct performance reviews : Regularly evaluate the performance of each employee to measure their contributions and effectiveness.

Skills inventory: Create a comprehensive list of skills each employee possesses and compare it with what is needed for future projects or roles.

Employee surveys: Gather feedback directly from employees about their job satisfaction and aspirations, which can highlight potential areas for development.

Utilize workforce analytics tools: Implement tools that can analyze employee data to help forecast needs and identify trends in employee development and retention.

Gap analysis: Perform a skills gap analysis to pinpoint the specific skills and roles your business lacks, which are critical for future growth.

Step 2: Define business goals and objectives

Aligning your staffing needs with your business goals is essential for strategic business planning. This step ensures that every hiring or development effort contributes directly to the company's long-term success.

Examples of setting clear and measurable goals that affect staffing:

Increase sales revenue by 20% over the next year: This might require hiring more sales staff or developing current staff to enhance sales skills.

Improve product development cycles: Staff up the product design team by hiring additional skilled engineers and designers.

Enhance customer service: Train current employees or hire new staff to meet enhanced customer service goals, aiming to increase customer satisfaction scores by 15%.

Step 3: Forecast future staffing needs

Forecasting future staffing needs is critical to preparing for growth and changes within your market. This step involves using both quantitative and qualitative methods to predict future staffing demands based on industry trends, business growth, and technological advancements.

Effective forecasting helps you anticipate changes in the demand for labor, allowing you to respond proactively rather than reactively. It ensures that you have the right number of employees with the necessary skills at the right time.

Techniques for forecasting staffing needs:

Trend analysis: Look at past staffing trends in your company and industry to predict future needs.

Ratio analysis: Use ratios such as staff-to-sales or staff-to-production volume to determine optimal staffing levels based on changes in business volume.

Use forecasting software: Implement advanced forecasting tools that can analyze current data and predict future trends in staffing.

Scenario planning: Consider different future business scenarios and how they might impact your staffing needs, such as a tight labor market or rapid technological change.

Consult with leadership teams: Regular meetings with your company’s leadership to align the staffing plan with evolving business strategies and external factors.

Step 4: Create job descriptions and roles

When you clearly define job roles, you make sure your team covers all the bases your business needs to thrive. Think of job descriptions as tools not just for hiring, but also for managing your team's performance. They set clear expectations for what's required in each role and help measure how well these are being met.

Steps to write effective job descriptions that attract the right talent:

Start with a clear job title: Use a title that reflects the role's duties and is recognizable in your industry.

Outline the job's purpose: Briefly describe how the role contributes to the company's goals.

List specific responsibilities: Be detailed about what the job entails to avoid any confusion and to attract candidates who are ready for these tasks.

Include required skills and qualifications: Specify the education, experience, and technical skills needed. Mention soft skills that are crucial for the role.

Describe the working conditions: Include work hours, travel requirements, and any physical demands.

Add information about salary and benefits: Be transparent about the compensation range and benefits to attract the right candidates.

Step 5: Sourcing and recruiting talent

Finding the right people involves more than just posting a job ad. You need to use a mix of strategies to reach the best candidates.

Recruitment strategies:

Digital platforms: Use job boards, social media, and company websites to post job openings.

Recruitment agencies: These can help find candidates with specific skills or in tight labor markets.

Networking: Attend industry events or use professional networks like LinkedIn to connect with potential candidates.

Best practices for an efficient and inclusive hiring process:

Streamline the application process: Make it easy to apply and communicate clearly and frequently with candidates.

Use structured interviews : This keeps the assessment consistent and fair for all candidates.

Focus on diversity: Aim for a diverse workforce that can bring a variety of perspectives and skills to your company.

Evaluating candidates - what to look for beyond the resume?

Cultural fit : Ensure their values and work style align with your company's culture .

Potential for growth: Look for candidates who can evolve with your company and take on new challenges.

Soft skills: Communication, teamwork, and problem-solving skills can be just as important as technical abilities.

Step 6: Selecting and hiring process

Choosing the right candidate is key, and it starts with a good selection process. First, screen the applications to find matches based on the job requirements . Then, conduct interviews to dive deeper into candidates' experiences and skills, and assess their fit with your company culture.

Don’t forget to include practical assessments if the job demands specific technical skills. It’s also crucial to stay on top of legal requirements, like making sure all candidates can legally work in your area and adhering to fair employment practices.

Once you’ve picked the right candidate, make their transition into your team as smooth as possible. An effective onboarding program, a mentor for guidance, and regular employee feedback can help new hires integrate successfully and quickly become part of the team.

A staffing management system is a software tool designed to streamline all aspects of managing a company's workforce. It helps organizations plan, recruit, deploy, and track employees efficiently. This type of system integrates various HR functions, including recruitment, staffing planning, employee scheduling, and performance management, into one unified platform.

Useful Reads: Employee Management Software for small business - A Guide The 6 top Employee Performance Management Trends of 2024

By automating many of the manual processes associated with human resource management, a staffing management system can significantly reduce the time and effort required to manage staffing needs.

Benefits of using a staffing management system:

Improved Efficiency and Time Savings: Automating staffing tasks like scheduling, payroll , and compliance reporting saves time and reduces errors. This allows HR staff to focus on more strategic tasks rather than administrative duties.

Enhanced Data Analysis and Decision Making: With integrated data analytics tools, staffing management systems provide insights into workforce trends, helping businesses make informed decisions about hiring, training, and employee development.

Better Compliance and Risk Management: These systems help ensure that staffing practices adhere to legal and regulatory requirements, reducing the risk of non-compliance penalties. They can automatically update to reflect changes in employment laws, helping companies stay compliant.

Your work schedule in one central place!

• Create rosters quickly
• Insight into labor costs
• Access anywhere via the app

Building an effective staffing plan is more than a routine HR task—it's a strategic imperative that aligns your workforce with your business goals.

From assessing your current workforce to forecasting future needs and effectively recruiting and integrating new talent, each step is crucial in developing a staffing strategy that not only meets your immediate needs but also positions your business for long-term success.

By incorporating a staffing management system, you can further enhance the efficiency and effectiveness of your human resources efforts. Armed with this step-by-step guide, you're now ready to create a staffing plan that ensures your team is robust, capable, and ready to drive your business forward.

Optimize your staffing plan with Shiftbase

Efficient staffing is crucial for any organization's success, and Shiftbase provides the tools you need to create and implement an effective staffing plan. Our employee scheduling feature allows you to strategically align your workforce with business demands, ensuring you have the right people at the right time.

Additionally, our time tracking capabilities provide insights into employee hours, aiding in workload management. Absence management ensures that leave does not disrupt business operations, maintaining continuity and productivity. Experience how Shiftbase can streamline your staffing process by signing up for a 14-day free trial here . Simplify your staffing plan with Shiftbase today.

Written by:

Rinaily Bonifacio

Rinaily is a renowned expert in the field of human resources with years of industry experience. With a passion for writing high-quality HR content, Rinaily brings a unique perspective to the challenges and opportunities of the modern workplace. As an experienced HR professional and content writer, She has contributed to leading publications in the field of HR.

Please note that the information on our website is intended for general informational purposes and not as binding advice. The information on our website cannot be considered a substitute for legal and binding advice for any specific situation. While we strive to provide up-to-date and accurate information, we do not guarantee the accuracy, completeness and timeliness of the information on our website for any purpose. We are not liable for any damage or loss arising from the use of the information on our website.

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How to Develop a Staffing Plan

This how-to guide is designed to help an HR professional answer the question, "What staff support will my HR department need in the next year, and how will we meet those requirements?" (Generally, the time period is a year, but it could be shorter or longer.) The staffing plan should be used to identify not only head count additions and reductions but also the different skills and knowledge that might be needed. Staffing plans may encompass employees, contractors, consultants or other experts. In essence, the steps used in developing a staffing plan help HR professionals ask the right questions to come to a clear understanding of the current state, the desired future state of the function and how to get there.

Staffing plans are often used during budget cycles to help plan and allocate costs. However, staffing plans can be used any time there will be a major adjustment to a workforce.

While the steps given below and the sample staffing plan are specifically for a human resource department, they can be applied to any function within an organization. HR professionals can also use the steps and staffing plan on a larger scale for a division or entire company. For best results, each step should be completed in order rather than jumping ahead.

Staffing plans can be one component of a strategic workforce plan. The differences between the two and how they intersect will be discussed at the end of this how-to guide.

For a demonstration of how each step would work, see a sample rationale for decisions made at the end of each step, and a sample staffing plan based on those decisions.

Steps to Complete a Staffing Plan

Step 1: evaluate goals.

The first step in developing a staffing plan is to evaluate the needed goals to achieve. By recognizing the targets employees will be working toward, human resource professionals can identify the amount and type of support needed to meet those expectations.

Ensuring a clear understanding of expectations helps HR professionals in a number of ways. Departmental goals should align and support organizational goals. Thus, this exercise is a perfect opportunity to reach out to other leaders to understand their expectations of the department in the upcoming year, including support for major projects, new strategic initiatives or other changes that will require adjusting staff.

In addition, during this step, HR should identify any major goals within the function. Perhaps a reorganization or realignment is needed to increase customer service or develop specific expertise.

Questions to ask when evaluating goals include:

• What are the organization's major strategic and tactical goals for the upcoming year?
• How will the HR function support those goals?
• What goals do I need to set for my function to ensure I'm aligned with the company's goals?
• What support are other functions/departments expecting from my department this year?
• What internal goals would this function like to achieve this year?

Step 2: Identify Influencers

In this step, HR professionals determine the factors that might affect the staffing plan. Influencers can be internal or external to the organization. They can be positive or negative and are defined as anything that might indirectly affect the plan but that the organization has little control over. By evaluating influencers on the staffing plan, HR professionals survey the landscape to identify and understand forces that will affect the talent supply. Examples of such influencers are a tight labor market, changing regulations and evolution of a function.

To complete this step, HR professionals should start with a brainstorming session to identify everything that might impact their workforce. Once they generate the list, they can then group like influencers. For example, if the brainstorm list includes "low unemployment" and "competitor ABC Company is hiring 50,000 local workers in the next year," the two could be consolidated under the influencer "external workforce availability."

Sources that provide labor market data include:

• U.S. Bureau of Labor Statistics.
• State and municipal labor statistics.
• State unemployment data.

Questions to help identify influencers include:

• What is the talent availability in our market?
• What trends are affecting skill development? These could be social impacts such as managing social media requirements, learning new skills as part of process evolution or the need to learn new technology.
• Will technology changes influence our labor supply or demand? These changes could be new technology that will require additional staffing or training time or technology that improves efficiencies, thereby eliminating jobs.
• Will changes to regulations affect our workforce?
• Do we have competitors that will affect the supply of labor? Perhaps competitors are growing their workforce, or they are laying off people, thereby growing the labor supply.
• Will economic or financial factors affect our staffing plans? These may include anticipated changes to the local economy, tightening of financing available to the organization or an influx of venture capital funding.
• Do we need to account for constraints or impacts from facilities or infrastructure? These include office size, location and commuting implications.
• Are potential "game changers" affecting our industry? Called "disrupter companies," examples include Uber and its impact on the taxi industry. Other game changers include technology improvements such as driverless cars that may affect the transportation industry.

Step 3: Analyze the Current State of the Function

As with any plan, it is critical to know the starting point. In this step, HR professionals compile information on the current state of the function or create an inventory of the important components of the skill set currently in play.

Compiling information on the current state of the HR function involves listing all current resources, including staff, contingency workers or other people who regularly support function goals. In addition, the current-state analysis should determine competencies, skill set or expertise to fully understand the tools presently available to meet expected plans.

As part of the activities in this step, HR professionals need to decide which systems to use to obtain the analysis data. Small departments can simply count positions on an organizational chart. However, data for larger staffing plans may need to be pulled from the human resource information system (HRIS) or payroll, talent management or scheduling systems. If the staffing plan is for head count purposes, payroll or HRIS data will suffice. But for competency planning, a learning or talent management system may provide the most accurate data.

In this step HR should also evaluate factors that may change the makeup of the department, such as flight risks, potential departures and current open positions actively being recruited.

This step does not include identifying gaps; that activity happens in Step 5.

Questions to ask while analyzing the current state include:

• What systems should I review for data on the current state?
• Who are my current staff members? What positions affect how we get things done (e.g., what responsibilities require an HR manager versus an HR administrator)?
• What expertise do staff members bring to their role?
• Do other employees outside of my function regularly influence achieving HR team goals (e.g., perhaps the employee in payroll who reports to the chief financial officer)? This question is especially relevant in matrixed organizations.
• Do vendors, contractors or others outside my organization regularly contribute to achieving team goals?
• What are the competencies my current staff have?
• Do I have any employees who are flight risks or who have personal issues that may affect their longevity with the organization?

Step 4: Envision Needs

In Step 4, HR professionals envision what will be needed to accomplish the goals set out in Step 1. Keys to this step are to start fresh and not be overly influenced by the current state. This step identifies both end-state staffing and interim needs. It should be assessed at both a head count and skills level.

To complete this step, HR professionals should review the goals outlined in Step 1 and imagine what will be needed to accomplish those goals. It is best to envision needs as if building the department from scratch. Taking this approach will help articulate requirements without being hampered by the current state.

The envisioning step may be approached from a head count perspective. However, envisioning needs from a skill set, competency or expertise perspective helps overcome biases that may exist in the current state.

Questions to ask while envisioning needs include:

• What expertise does the HR function need to accomplish our goals for next year?
• How many people will we need to meet our goals, and where should they be located? Sources for this figure may include current span-of-control numbers, staff ratio recommendations, historical rule of thumb within the organization or statistical regression analysis.
• Does staffing change throughout the year? What will it look like in six months? In 12 months?
• What is the ideal mix of staff, contractors or outside expertise needed to meet our goals? Generally outside experts are costly specialists such as lawyers or consultants whom HR may want on only a very limited basis but whose input is critical to the success of the plan. Contractors should be hired to fill short-term needs.
• What budget will we need to meet our goals?

Step 5: Conduct a Gap Analysis

Step 5 identifies what is missing between the end state outlined in Step 4 and the current state identified in Step 3. Gaps may include inadequate staffing, lack of expertise or simply the wrong people in the wrong place. Information derived from a gap analysis will identify deficiencies in the current state of the function that HR will need to address to achieve the outlined goals. HR professionals should not view these gaps as weaknesses of the current department but rather as opportunities to evolve the function into an ideal state to achieve organizational goals.

Questions to ask when doing a gap analysis include:

• If I compare the end state to the current state, in what areas are we currently unable to support outlined goals?
• Where will we need to adjust current staffing? Will factors such as current performance or mobility affect the current staffing?
• Do we lack staff with the right expertise in functional areas?
• Do we have geographical gaps in which we need to hire staff?
• Will cross-functional collaboration be needed? If so, how can we strengthen that partnership?

Step 6: Develop a Solution Plan

Having conducted the analysis above, HR professionals can now put together a plan to achieve the stated goals for the upcoming year. The plan should include both end-state staffing and any interim staffing needed. Step 6 often encompasses determining timing (i.e., when to hire or promote specific staff) and assigning costs if the staffing plan is being done in conjunction with a budget cycle.

The plan itself should outline the staff needed, at what time and location. It should differentiate full time versus contingent staff and identify every role needed in the function from entry level to executive. The plan may also detail the timing for when specific, outside expertise is needed.

Staffing plans may be created as tables, charts, PowerPoint presentations or other visuals. The important thing is to present the information in a format that provides the amount and type of information required in an easily consumable format.

Questions to ask while developing the solution plan include:

• Given all the information above, how do I use it to achieve the goals outlined in Step 1?
• At the end of the year, what should my staff composition consist of?
• When and where will we need to adjust staffing levels to support organizational goals?
• What level of expertise do I require in which roles?
• How am I accommodating for the influencers identified in Step 2?
• How am I addressing the gaps outlined in Step 5? Outside of hiring, would training or other methods help cover these gaps? Can we fill some of these gaps with technology?
• Finally, how often do I need to revisit this plan to ensure it continues to meet organizational needs?

As detailed above, completing a staffing plan comprises six main steps:

• Evaluate goals: What does this function need to accomplish?
• Identify influencers: What factors might affect the staffing plan?
• Identify the current state: What is the starting point?
• Envision needs: What is really needed (end state)?
• Conduct a gap analysis: What differences exist between the current state and the end state?
• Develop a solution plan: What types of staff are needed? When and where?

The above outline is designed to complete a staffing plan for a specific function. Staffing plans can also be created for entire divisions or organizations. To complete staffing plans with a bigger scope, organizations can break down the plan into manageable pieces. For example, a division might complete individual staffing plans for the sales, finance, HR, IT, marketing and production functions and then combine them into one overall plan. HR professionals responsible for this type of planning must closely collaborate with the leaders of each individual group to understand goals, needs and expertise required. Conducting such an exercise can help leaders refine their understanding of how each function interlocks to support overall organizational goals.

As noted in the introduction, staffing plans may be one component of workforce planning. The table below provides a summary of the difference between staffing plans and workforce planning as defined by a study on strategic workforce planning conducted by The Conference Board in 2012.

Staffing plans can be the first step in evolving the organization toward adoption of workforce planning. As leaders become more comfortable with the iterative exercise of planning for head count, additional complexities in terms of criteria, time frames or scenarios may be added to help address long-term strategic plans.

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How to Build a Staffing Plan [Free Template]

Your workforce is your most important asset. Whether you provide a product or service, the quality of your offerings hinges on having skilled and engaged employees . Securing or maintaining that sort of talent is challenging even in a calm market, but you can smooth bumps in the road with a carefully planned staffing strategy.

A great staffing plan can help you to anticipate employment changes ahead of time, more easily make hiring decisions, streamline transitions, and even improve productivity through training. Building a plan will require more than a little internal and external research, but today we’re walking you through each step.

Need an example staffing plan to get an idea of what this entails? We’ll do you one better. Download our free staffing plan template and start mapping out your organization’s needs today.

Staffing Plan Template

Not sure where to begin when creating a staffing plan? Use this template to help you get started. Click the button below to open the template in Google Sheets.

1. Identify Your Organization’s Business Goals

Optimizing your staffing plan starts with a look at the big picture. By pinpointing your business’s short and long-term objectives and aligning your plan to those goals, you’ll be making it easier to determine your staffing needs both now and down the road.

When you’re outlining your business goals, be sure to consider the following factors:

New projects, products, and initiatives. Not only could these mean additional staff is necessary, but knowing what’s coming can help you pinpoint needed skill sets.

Upcoming strategic changes. Shifting to remote or hybrid work , returning to the old office or opening a new one, and organizational restructuring will all impact your staffing needs.

Any new tools, technology, or platforms you might be planning to adopt, as well as the skills needed to use them. New technology like AI is changing the way many jobs are done. If you’re planning on adopting a new tool, not only will you need to consider how it will affect how much staff you need overall, but you’ll also need to plan to close skill gaps that these new tools open.

Clear-cut goals for metrics like productivity, sales, and customer satisfaction. Factors like these can help when deciding staffing needs later.

Recruiting and retention. Is your business expanding, staying the course, or possibly looking to shrink? Be sure to consider these factors in both the short and long term.

2. Audit Your Current Staffing Layout, Top to Bottom

Next up, you’ll want to take a critical look at your current workforce. Here’s the information you’ll need:

Workforce demographics , including basics like how many employees you have and finer details like tenure, age data, and hiring and turnover rates . Knowing when to expect retirement or turnover can help with anticipating future staffing needs.

Job description data. Familiarize yourself with what roles are available, what work is being done, and what skills are necessary to complete tasks.

Employee skill sets. Chart out which skills are available in abundance at your organization and which skills are more in demand – this is your skill gap analysis . Be sure to include skill sets that may become necessary due to new positions opening or new tools or tech being adopted.

Performance data. While low performance is obviously something you’ll want to pay close attention to and address with additional training, make a note of high performers, too. Recognize their efforts, consider them for promotions, and be aware that they could be snatched up by other businesses in your industry.

Depending on the size of your organization, this could be the most difficult part of the process, but it’s still crucial. Utilizing software that centralizes and aggregates this information for you can make this task a whole lot easier.

3. Map Out Realistic Staffing Needs

Once you know your organization’s goals and current staffing situation, use that information to forecast your staffing needs. Predictive analytics tools can be a great help here, as such software can quickly pinpoint potential trends in employee habits, productivity and turnover that could be useful for you.

You’ll want to look at:

Internal business needs. Knowing your company’s plans for the future, do you anticipate new positions opening or old ones becoming obsolete? Do you have departments that have a surplus of talent or ones that need a helping hand? You may find that you need to create new positions, consolidate old ones, or arrange training.

Internal trends for retirement, leave, and retention. Given this information, do you think you will have enough staffing to tackle your business goals? You may need to make plans to fill upcoming gaps.

Skill gaps. Utilize that skill gap analysis you made when you audited your current staffing plan to identify hiring and training needs. Keep in mind that a gap in skills doesn’t necessarily mean a new hire is necessary, according to Harvard Business Review , 68% of workers worldwide are willing to retrain their skills.

Internal employee needs. How is engagement at your company? What are your turnover rates? Are you offering competitive salaries and/or benefits packages that provide access to services your employees find useful? Changes may be necessary to improve retention.

Internal candidate availability. Your top performers make great candidates for promotion.

External candidate availability. Familiarize yourself with market and hiring trends for the skills you might want. You’ll want to know whether a role is in high demand or not.

Your competitors. An important part of your staffing strategy will be making sure you’re market competitive. Research current roles, compensation offerings, and growth in your industry, not just internally.

4. Build and Implement an Organic Strategy, Not a Monolithic One

By mapping out goals, current assets, and needs, you've already done the bulk of the work for creating a staffing plan.

Update or create policies for succession and training for all positions to ease transition after retirement, promotion, or turnover.

Outline how hiring, promotion, and staff reduction decisions should be made if such policy doesn’t exist already, or bring those policies better in line with your company’s goals or values, if necessary.

Track all current and anticipated positions. Identify their budget requirements, skill needs, and current hires in those positions.

Take another look at your job descriptions. Part of your plan should involve ensuring that role responsibilities and expectations are well-defined, realistic, and clear.

Plan how gaps will be filled. Work with leadership to determine whether you will meet your staffing needs with new recruits or internal training and promotion.

Don’t reinvent the wheel. While you’ll certainly need something that fits your organization’s unique needs, you don’t need to start from square one. There are plenty of example staffing plans available online. Use a staffing plan template like the one we’re providing here as a jumping off point to build something that suits your needs!

Update it regularly. A staffing plan should be a living policy, one that grows and changes as your company does. Don’t treat it as a monolith, unchanging once complete. Be open to reviewing and revising it at least annually to keep it optimized.

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6 Steps To Create a Staffing Plan That Covers Your Business and Resource Needs

See how to create a complete staffing plan by diving into forecasting, financial metrics, and team capacity.

Table of contents

Are you struggling to find the perfect balance for your team? You're not alone. Creating a staffing plan is essential for achieving business success and reaching your strategic goals.

This process involves forecasting, analyzing past projects, and pinpointing areas that need improvement. Your delivery team might say they're swamped, while your financial team claims you're overstaffed. It's tough to know who to believe, right?

Remember, it's crucial to put people first when planning your staff. Make sure your team members have the right skills and are well-rested and well-utilized. By crafting a well-thought-out staffing plan, you'll be on your way to building a strong, effective team that drives success and helps you achieve your strategic goals.

In this post, we'll show you how to use objective data to get the clarity you need to decide when to hire and how much staff to add, as well as gauge the efficiency of your investments. Creating a staffing plan is a simple task, but there's more to it than meets the eye.

Stick with us; we'll guide you through this process to set your business up for success!

Step 1: Understanding your business economics

What needs to be true for your staffing plan to make economic sense?

The process of creating your staffing plan can be started by zooming out and taking a look at your business through a set of metrics that will help you answer whether or not your agency is healthy and has the right balance of staff and income.

By understanding the key metrics, and pairing them with your current position and future goals, you’ll have a solid foundation to work upon.

A.) Delivery margin

Delivery margin, or the profit generated from the sales of services after deducting the cost of producing or providing them, is considered one of (if not the) most important metric to track at your agency from a financial perspective. The formula is simple:

Delivery margin = Agency gross income (AGI) - Delivery expenses

Or on a percentage basis:

Delivery margin (%) = (AGI - delivery expenses) / AGI

The delivery margin percentage represents the portion of each dollar of revenue that remains after deducting delivery expenses.

Your delivery expenses, as mentioned below, will mainly consist of your staffing costs and other expenses like tools, fees, supplies, etc. If you’re aiming for a 60% delivery margin, meaning that for each dollar you make as an agency, you keep 60 cents of it, then you must ensure that your staffing expenses will line up with that. If you’re only keeping 40 cents of each dollar you make, you might have to consider a tweak in your staffing plan to hit your goal.

B.) Overhead benchmarks

In addition to monitoring your staffing plan based on the delivery margin you're making, it's essential to ensure that your overhead spending ratios align with your current staffing plan.

Having worked with hundreds of agencies and financial statements over the years, we at Parakeeto have developed a benchmark range that successful businesses should aim to operate within for a sustainable agency. These benchmarks can be divided into three overhead areas:

• Sales & marketing department: Aim for 8-12% of your AGI (Agency Gross Income).
• Administration: Target 8-12% of your AGI as well.
• Facilities: Strive for 4-6% of your AGI.

Keep in mind that the ranges for each department aren't necessarily set in stone, as we understand that every agency is unique. What's most important is that your total overhead (the combined expenses of all three departments) falls between 20-30% of your AGI.

C.) Salary allocations

It’s important to benchmark all of these financial metrics having factored in the cost of your team in each of those buckets. This means attributing each person’s salary across these areas of your organization to understand the impact that their salaries have on your financial health and the balance of these different spending categories as you update your staffing plan.

You may realize that after tallying up salary expenses for your S&M team that you’re far too invested in this team, above the benchmark range listed above. Conversely, the opposite could also be true.

Being aware of salary allocations and adjusting your staffing plan accordingly can help ensure that your organization remains financially balanced and on track to achieve your goals.

D.) Staffing impacts on delivery margin

Let's examine how your staffing can affect your delivery margin, the factors that influence it, and how to keep it under control. There are three factors that impact your delivery margin , all of which relate to your agency's staff: Average cost per hour (ACPH), average billable rate (ABR), and utilization.

Scenario 1:

Imagine you're considering closing a deal and wondering how much you can discount the price while still being profitable. You're aware that payroll is your agency's most significant cost, but do you know how much each hour of your team's time costs you to appropriately mark up those hours?

That's where ACPH comes into play. This metric directly affects your delivery costs and, consequently, your delivery margin.

Scenario 2:

Suppose you're deciding whether to add a new team member. The first question you'll ask yourself is, does this department need another team member?

Utilization , or the amount of time your team spends on revenue-earning activities (in delivery), helps you determine how busy your team is. It's also an opportunity (or risk) for moving your delivery margin metric.

The busier your team is with revenue-earning activities for the agency, the higher the overall delivery margin you can expect (assuming that time isn't spent over-servicing). Conversely, the more your team has to wait for more work to be won, the less efficient their time usage will be.

Scenario 3:

Imagine you have capital to invest in additional team members, and your company offers design and development services. By calculating each revenue stream's average billable rate , or how efficiently revenue is earned, you'll be able to compare the two and decide where you'll get the most value for your investment. You'll also gain more clarity on the revenue capacity a given team member should add to your business.

<tip>

Tracking billable hours can be done with a simple spreadsheet, but using a dedicated tool helps you avoid errors and bill clients correctly. You can also test our new timer to see how you can take the hustle out of time tracking.

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Step 2: Develop a capacity model

Start by creating a capacity sheet where you can model the following details for each team member:

• Salary, benefits, commissions, and payroll taxes
• Role and department
• Total hours worked by the individual
• Number of hours spent on delivery tasks and other departments they may work in

Consider these departments:

• Sales & marketing (internal)
• Administration/back office (internal)

Once you've gathered this data, the capacity sheet will help you understand how much of your payroll costs can be allocated to each department in your business. It will also give you an idea of how many hours your team has available to complete deliverables . You can find a template for a spreadsheet like this in our free agency profit toolkit .

An optional but valuable concept to consider is the role category . The goal is to group your capacity into a few meaningful subsets of delivery. Choosing a role category for each team member might be challenging, but try to make it work by rounding the edges a bit, and we can refine the details later.

For example, here's what a role category exercise might look like for a design firm:

<table>

Employee | Role | Role category ~ Tina | Creative Director | Strategy ~ Trisha | Sr. Designer | Design ~ Tanya | Sr. Designer | Design ~ Tommy | Jr. Designer | Design ~ Tino | Jr. Designer | Design ~ Traci | Project Manager | Accounts ~ Tiffany | Account Manager | Accounts

</table>

This model, with role categories defined, allows you to drop a potential hire into your plan and immediately see how it impacts a subset of your business. It will also show you how much revenue you need to add to fully support them, how it impacts your utilization target, your potential delivery margin and overhead ratios.

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Step 3: Develop a financial forecasting model

Understanding the three values that impact delivery margin helps you build a financial model that projects into the future.

Let's work through an example to see how this is done. We'll start with a simple case of a designer on your team using the following capacity grid, which you can create using the agency profit toolkit :

In this example, we have a designer named Tina who works 40 hours a week (2,080 hours a year) and makes $100,000 in total compensation, including benefits, commissions, and payroll taxes. Tina is expected to deliver 32 hours of work to clients each week, and she's likely to take 30 paid days off this year.

To forecast financially, we need to figure out how much revenue (AGI) Tina can generate using this formula:

AGI = (Capacity x net utilization) * ABR

Tina's annual capacity is 2,080 hours.

Utilization

We calculate Tina's projected utilization rate based on her weekly expectation to deliver client work. Out of 40 available hours, Tina is expected to bill 32, giving her an 80% utilization rate.

Gross delivery capacity

Tina's gross delivery capacity is her total capacity (2,080 hours) multiplied by her utilization rate (80%), which equals 1,664 hours.

Net delivery capacity

Before using the formula, we must account for Tina's time off. Converting her 30 days of annual leave into hours (8 hours a day) gives us 240 hours. These 240 hours can't be billed to clients, so we need to subtract them from Tina's original delivery capacity and recalculate her utilization.

Gross Delivery Capacity - PTO Hours 1,664 - 240 = 1,424 delivery hours

To find Tina's net utilization, divide the new delivery hours (1,424) by her total available hours (2,080). This gives us a net utilization of around 68%.

Your standard rate

For ABR, this is the rate you'll charge for Tina's time. Let's say it amounts to $200/hour.

Putting it all together

AGI Capacity = 1424 * 200 = $284,800

You can expect Tina to add $284,800 of AGI capacity to the business, meaning you should be able to sell and deliver roughly that amount of extra work, assuming things work out as modeled.

The levers mentioned above, namely, average billable rate (ABR), average cost per hour (ACPH), and utilization, can significantly impact your margins. If someone is only half as utilized as you planned, they will generate much less revenue for your agency. Conversely, even small increases in utilization or ABR can positively impact your bottom line.

If you feel understaffed but don't have the funds to hire more employees, you may have an efficiency issue with your current team. In such cases, assessing your capacity model and identifying opportunities to improve utilization and optimize ABR to achieve better margins is essential.

Small tweaks in utilization or ABR can significantly impact budgets and margins. By understanding the revenue targets you need to set based on your staffing plan, you can ensure financial sustainability for your agency.

Additionally, since your capacity model includes department allocations, you can get an idea of how much you're spending on each department in terms of payroll and compare it to the overhead benchmarks noted in Step 1 to assess whether you're on track.

Step 4: Develop a planned work model

Developing a planned work model is crucial to plan your work effectively .

This can be as simple as tracking the number of scheduled hours for a project or set of projects and then comparing this to your capacity model to see how much work you have planned and how it relates to your current staffing. This is where the role categories you defined in Step 2 come into play.

For example, imagine you run a creative studio that offers various media projects such as brand kits and websites. Your role categories might include design, development, accounts, and strategy. If you've sold a project for a small brand kit to a new agency that needs to be delivered within a week, you can use the role categories you've defined to list the planned hours for this project.

Role category | Planned Hrs ~ Design | 40~ Strategy | 3~ Accounts | 8

Once you have this information, you can compare it to your team's capacity for each role category during that period to determine if your team can handle the workload.

Role category | Hours/yr | Hours/wk ~ Design | 5000 | 96.2~ Strategy | 1500 | 28.8~ Accounts | 2500 | 48.0

For example, the design team might have a capacity of 96.2 hours per week, while the strategy team might have a capacity of 28.8 hours per week. By comparing your planned hours to your capacity, you can ensure you're staying focused on your team and risking burnout or missed deadlines.

It's also essential to consider developing a simple set of products or service lines to create meaningful segmentations of your work. This will help you collect better data for estimation and forecasting purposes in the future.

Step 5: Forecasting your staffing needs

The next step involves forecasting your staffing needs. However, before you dive into the details of your resource plan , it's essential to understand the difference between precision and accuracy. Being overly detailed in your plan can harm your accuracy, so keeping it simple is vital.

People often use a bottom-up approach when creating a staffing plan. This involves breaking down a project into smaller tasks and assigning them to individual contributors to understand how their work matches up to their capacity. While this approach is precise and provides insight into team capacity in the short term, it becomes less effective early on in a project's lifecycle or for longer time horizons and can create problems when changes need to be made.

That's where top-down forecasting comes in as a more helpful approach for getting forward visibility into your staffing needs. It's more focused on accuracy than precision and involves using higher-level estimates about projects, often using historical data to estimate the time required by role category. By rolling capacity up into role categories, we remove a lot of the precision that slows down the process of building a capacity model while maintaining a reasonable amount of accuracy when looking forward over longer time horizons and running multiple scenarios.

As the project progresses and the scope and sales process are de-risked, the forecasting process can move towards a more precision-focused approach. Eventually, the project management team will generally use bottom-up forecasting throughout the project to maintain accuracy and ensure that the team has the necessary resources to complete the project successfully.

➡️ Learn more about how to conduct effective resource forecasting .

Step 6: Install feedback loops

When creating a staffing plan, it's important to remember that plans are built on assumptions. Agency operations involve taking assumptions about client work and projecting them into the future. However, sometimes those assumptions are wrong, and the plan falls apart.

So, what can you do to be ready for anything? The answer is to install feedback loops.

By setting up a feedback loop, you can continually improve the accuracy of your models and forecasts. To do this, you need to track three important metrics: Scoping accuracy, average billable rate (ABR), and utilization.

Scoping accuracy involves comparing your estimates of the time required to complete a project or group of projects with what happened. Did your estimates match up with the actual results?

The average billable rate (ABR) tracks your rates trending over time. Is the ABR different depending on the service offering or the person doing the work?

Utilization measures whether or not you're hitting your targets. Are you using your resources effectively? Is utilization different depending on the person or the role category?

To set up this feedback loop, ensure that your time-tracking data is aligned with the structures discussed in earlier steps (capacity model, planned work, etc.). Your project names, service lines, products, and role categories should be consistent in your time tracking or project management tools. This will make comparing estimates vs. actuals easy and not require hours of data transformation, cleaning, organizing, etc.

Set a regular cadence to measure these metrics, and use the information you gather to adjust your models and forecasts. By continually tweaking your staffing plan based on the feedback loop, you'll be able to adapt to changes in your business and improve your accuracy over time.

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Who can you look to for this information?

When collecting the necessary information to create a comprehensive staffing plan, it's important to remember that you might need help to gather all the data.

Different parts of your business will have separate data and processes relevant to the staffing plan. Your financial, operational, HR, and delivery teams will all play a role in providing the information you need.

Creating a staffing plan is a group effort, but you may be responsible for bringing it all together and making sense of it. Feel free to contact your colleagues in different departments and ask for their input. Collaboration is critical to creating an adequate staffing plan.

Maximizing your agency's success with a staffing plan

A comprehensive staffing plan is crucial for any agency to maximize its success. Your team is the lifeblood of your business, and having the right people in the right roles at the right time is essential.

Creating a staffing plan may seem daunting, but you can make informed decisions about hiring and resource allocation by developing models, monitoring KPIs, and setting up feedback loops. Collaboration with colleagues from different departments is also crucial in this process, as they can provide valuable insights and help collect necessary data.

By dedicating time and resources to creating a comprehensive staffing plan, you can create a data-driven approach to staffing that will allow you to adapt to changes and make informed decisions. This will not only support your agency's success but also ensure your team's well-being.

With a comprehensive staffing plan in place, you'll be well-equipped to face any challenges that come your way and make the most of new opportunities.

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How To Develop a Staffing Plan: A Step-by-Step Guide

• Templates & Guides

If you’re looking for a new and effective way to improve how your team and your business operate, a staffing plan may be the solution.

Staffing plans can provide a framework for all of your labor needs so you can be sure your business has the right number of skilled employees to meet the demands of your market — both now and in the months and years to come.

In this article, we discuss how to develop your own staffing plan and the software that can help get you there.

Table of contents

What is a staffing plan, how to develop a staffing plan.

• Busy restaurants need a staffing plan

A staffing plan is a collection of data points that measure and describe various aspects of the way your business operates, including foundational variables such as work activity, labor needs, and the time and money spent to get the job done.

With that information in hand, management (and your HR department , if you have one) can take steps to identify and predict:

• The current state of your workforce management
• Regular and recurring labor needs
• Skills your employees will need (both personally and for the business as a whole )
• Future labor needs and goals
• The steps your business will need to take to fulfill those goals

The process of developing a staffing plan can reveal all of that — and more. But how do you go about creating such a plan?

Read on to find out.

1) Review business goals

The foundation of a good staffing plan rests on the goals and strategies you have for your business.

These milestones provide direction to your organization as a whole and give your HR department and management a baseline with which they can start formulating important questions about the business, including:

• What are the highest-priority goals for the next 12 months?
• What departmental goals do we need to set to support the larger purpose?
• Do we need to reorganize or realign?
• How can human resource planning support the various levels of our organizational strategy?

The answers to these questions — and a thorough review and evaluation of business goals — will make up the framework of your staffing plan as it starts to take shape.

2) Look for conflicts and contributions

Once you’ve settled on the goals you want to use moving forward, the next step in developing a staffing plan is to look for conflicts and contributions.

Take a step back from the goals themselves and try to identify things that might help your business reach those goals. At the same time, try to identify things that might hinder your business along the way.

Conflicts and contributions can exist inside and outside your organization, so don’t limit where you look.

For example, your business may be affected by:

• A tight labor market
• Novel competitor activities
• Laws in your area
• Changes to responsibilities within your operation

Each of these could serve as a conflict or contribution to the way your team works and influence both the supply of talent you have available and the staffing plan you build to manage it.

3) Define where your business is now

Developing a staffing plan is like working backward on a road map: You put a pin in your destination and work your way backward, identifying places where you might slow down or speed up along your route until you reach your starting point.

In this case, your destination is achieving the various goals you’ve set. The slowdowns and speed-ups along your route are the conflicts and contributions you identified in step two. That leaves one variable undefined: your starting point.

After establishing where you want to go and the factors that affect your progress, it’s time to define where your business is now.

As you look at the current state of your workforce, make note of details like:

• Resources available
• Staff available
• Employee skills
• Employee knowledge
• Your business’s organizational chart
• The competencies your team needs to function

The data you gather in this step can help your business get a clear picture of where the operation is at right now and help you define the starting point of the staffing plan moving forward.

So, at this point, you’ve got a destination (the goals you want to achieve), an origin (the current state of your business), and the potential conflicts and contributions that could pop up along the way.

Now, it’s time to start planning how your business is going to move from start to finish.

4) Decide what you need to accomplish your goals

At this point in the process, it’s time to decide what you need to accomplish your goals.

Think of it like preparing for a road trip. You’ll need to choose a route, decide which vehicle you want to take, and finally, throw in some clothes, a bag or suitcase to put them in, and maybe some snacks and drinks to keep you fueled during the journey.

You can use the same idea to figure out what your business needs on the road to achieving the goals you set in step one.

Make a list of everything your business might need for the “trip” — whether it’s available to you at the moment or not.

Include things like:

• Physical resources

Once you have a list of the things you need, it’s time to separate that list into what you have and what you don’t have.

5) Figure out what’s missing

Next, go through everything on your “needs” list and determine what’s missing.

For example, you may have decided you’ll need a team of 10 to accomplish your goals. But maybe your business only has eight employees right now. Obviously, you know you’re going to need to hire two more employees before you start out.

6) Build a staffing plan to fill in the gaps

Now that you have information for all of the variables — goals, conflicts and contributions, starting point, needs, and shortfalls — it’s time to build a staffing plan to fill in the gaps.

At this point, you’ve done most of the work already. You just need to map out how your business is going to make sure it has the resources necessary to make the journey as successful as possible.

Then, all that’s left is to start the engine and put your staffing plan into action .

Staffing plans for busy restaurants

The restaurant industry is notorious for its employee turnover , but that’s just the nature of running a busy food-service establishment.

You can help cut down on turnover chaos by building a staffing plan for your business. This plan may be able to help you focus on hiring for skill , fit, and longevity instead of just finding someone who can do the job today and be gone tomorrow.

In fact, hiring the right person based on your labor needs and your staffing plan can help your restaurant develop a reputation for quality service.

And that doesn’t just come from your servers . Everyone from the head chef to the dishwashers and food runners can help your restaurant stand out from the crowd.

But it all starts with developing a staffing plan that can help you find exactly what your food-service business needs to get ahead.

Manage your staffing plan with Sling

Once you’ve built a staffing plan that’s right for your business, it’s time to put it into action. That involves managing everything from the hiring and firing process to the way you organize and optimize your team.

The Sling suite of tools can help you simplify and streamline all of that and give your business unprecedented control over the finer and more difficult points of workforce management , including:

• Employee scheduling
• Labor costs
• Time tracking
• Attendance tracking
• Task management
• Communication
• Employee documents
• Labor compliance
• And much more

Try Sling for free today to see how it can help you take your staffing plan off the paper and make it into a reality.

And, for even more free resources to help you manage your business better, organize and schedule your team, and track and calculate labor costs, visit GetSling.com today.

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This content is for informational purposes and is not intended as legal, tax, HR, or any other professional advice. Please contact an attorney or other professional for specific advice.

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Creating a Business Plan for Your Staffing Agency

Last Updated March 29, 2024

If you want to be a successful staffing agency owner, you need a blueprint that can put you on the path toward that success. For most, this blueprint lies in the form of a business plan.

Studies show that prospective business owners who create a business plan are 152% more likely to launch their business than those who fail to do so. Brainstorming a business plan is one thing, but actually putting in the work to start your business is another.

Prospective staffing firm owners will quickly learn that organization is one of the keys to success. Plus, there are plenty of requirements to start a staffing agency . You’ll need somewhere to note all these requirements, along with a point of reference that maps out how your business will be structured, your short- and long-term goals, revenue projections, potential financial needs, and more.

You can accomplish all of this through a single document: a business plan.

With that being said, let’s talk about how you can model your staffing agency all by simply drafting a business plan.

Before Devising Your Business Plan

Before getting started with your business plan, ensure you’re ready to handle the demands that come with running your own business by learning how to start a staffing agency . There are several federal and state documents required for opening an employment agency. These include:

• IRS Form 941
• Applying for an Employee Identification Number (EIN)
• Articles of Incorporation
• State Tax ID Number
• Business License and Certification

How to Create a Business Plan for Your Staffing Agency

Once you understand what you’ll need to start your staffing agency, you can get to crafting your business plan.

The nine steps below will help walk you through the process.

Identify Your Niche

The first real step of a staffing agency business plan is to consider some of the broader elements of your company, such as what (if any) niche industry you plan to prioritize staffing. You may choose an industry that you’re particularly passionate about, you have experience working in, or one that you believe could lead to a lucrative business.

While not every staffing agency outwardly advertises their niche in their name, the vast majority have an industry they specialize in above all others. Honing in on a single industry to staff can simplify your job as a business owner. An agency that recruits for all industries can still find success, but it will make it more challenging to stand out amongst your competition – think “small fish, big pond.” Agencies that focus on a single industry cast a smaller net but in a much smaller pond. This can make running a staffing agency far more manageable.

Create a Mission Statement and Executive Summary

Your mission statement and summary of your future company should be on the first page of your staffing agency business plan, as this is the first step for any business plan. This mission statement should highlight the purpose of your staffing agency – something more specific than “helping companies find top candidates.”

Make sure to answer the question, “Why?” in your mission statement. Why is matching candidates with ideal roles important to you and your business? Why is your business different?

A mission statement is crucial because it tells potential business partners (and potentially your own future employees) who you are and what you value. It will also serve as a constant reminder to yourself, especially on the most challenging days, of why you’re passionate about running a staffing agency.

Along with your company mission, include a general summary that describes your business in a few paragraphs. Think of this as an “About Us” page you’d see on a typical company website. This should include a “Product and Services” section, outlining aspects of your agency such as your niche, the services you offer, how you stand out from the competition, and how you expect to handle and work with new clients.

Collect Market Research

Conducting market research is a well-known, can’t-miss undertaking when establishing a startup. It involves analyzing market trends, industry trends, your target audience, your target clients, and your competition.

However, it’s not so simple to figure out where to start when it comes to market research .

A few ways to begin your market research journey include:

• Discovering industry experts and discussing topics with them
• Reading market reports and exploring public market data
• Subscribing to newsletters
• Utilizing market research tools, such as GoogleTrends, BuzzSumo, and SEMRush
• Interviewing or surveying your target audience
• Building buyer personas

As a staffing agency owner, a few simple examples include subscribing to newsletters such as Staffing Industry Analysts and reaching out to existing agency owners on LinkedIn.

Identify Your Competitors

Identifying competitors is what many perceive as the final, yet arguably most important, type of market research practice.

But, how do you figure out who your competitors are?

If you’re starting a nursing staffing business , for instance, the easiest way would be to search for medical staffing-related terms on Google and see which sources or agencies are consistently ranking at the top. SEMRush can greatly aid this keyword research process, as you’re granted access to a plethora of information relating to your potential competitors.

To identify your competitors, you can also ask for customer feedback and browse online forums or social media sites. When marketing your staffing agency to potential clients, you can also make note of any other companies that are routinely mentioned. If another employment firm is regularly being referred to by your leads, they’re likely a competitor.

Project Finances and Revenue by Completing a Financial Breakdown

Financial projections are a pivotal component of any business plan. You’ll first want to set an operating budget. Then, denote every significant expected startup cost and operating cost into two separate tables, as shown below:

Once you’ve done so, you’ll want to learn about and consider the following business metrics:

• Income (Profit – Loss)
• Balance Sheet

The best way to familiarize yourself with these metrics is by looking at, and eventually creating, all three of the major financial statements : a profit and loss statement , a business balance sheet , and a cash flow statement .

Then, you can begin forecasting sales, estimating figures – such as target monthly profits – and devising a three- to five-year financial projection. These longer-term projections should include monthly to yearly increments showcasing how you’re going to achieve your target numbers. Map out how you plan to attack these projections by setting realistic yet ambitious and quantifiable goals.

Related: How Are the Three Essential Financial Statements Linked?

Explore Staffing Agency Funding Options

Prior to working on securing your first contract, you need to ensure you have the funding to support your staffing agency.

If you’re a first-time business owner, it likely won’t be as simple as securing a traditional bank loan because of the stringent credit score requirements needed to qualify. And asking friends and family can be awkward and intimidating.

Therefore, leaning on alternative financing solutions might be your best option. But don’t worry! Many of these alternative lending options have proven highly effective at aiding small business growth.

A few alternative financing options include:

• Invoice factoring
• AR financing
• Crowdfunding
• Peer-to-peer lending

Invoice factoring has a reputation as particularly useful for staffing and recruiting agency owners. Reason being, most staffing companies typically don’t have the tangible collateral that banks like to see when offering significant loans.

If you’re unfamiliar with factoring, the process is relatively simple. It involves businesses selling outstanding accounts receivable to a third-party factoring company, or factor, which immediately advances the business 80-99% of the value of each invoice. The factor then assumes collections responsibilities for all of the factored invoices.

Once the business’s customer(s) submits payment to the factoring company, the factor releases the remaining value of each invoice to the business, minus a small factoring fee. As a result, staffing agencies that utilize factoring see an immediate boost in working capital and improved cash flow.

Regardless of how you choose to finance your business, it’s important to prioritize positive cash flow and ensure you have reliable working capital to fund operations and, eventually, business expansion.

Devise a Staffing Agency Marketing Plan

Knowing how to market your staffing agency will go a long way to determining your success.

Tips for creating a marketing strategy include:

• Define your audience
• Build relationships through local events
• Network with industry leaders or experts online, particularly LinkedIn
• Invest time and money into building a professional, visually appealing, informational website
• Prioritize feedback and reviews from clients, and advertise your positive feedback
• Establish your staffing agency as an industry expert by creating a blog and writing guest posts on other websites with your target audience
• Build keyword authority through your written content
• Advertise your staffing agency on social media sites and consider Google Ads

Seek Advice From Mentors, Investors, and Industry Experts

Before finalizing your business plan, it’s good practice to consult with personal business mentors, investors in your staffing agency, and industry experts to ensure you’ve covered all of the necessities.

Update and Revise Your Business Plan

Once you’ve completed your business plan, store it somewhere readily accessible because that’s not the final time you’re going to touch it. You’re likely going to refer back to your document once you’ve gotten the ball rolling with your business. After your first year in operation, you should compare your financial projections and goals with your actual finances to measure performance. You’ll then be able to make alterations to both your future projections and overall business strategy to better fit your position.

How Staffing Agencies Get Contracts

While creating a staffing agency business plan is an essential first step in starting your business venture, the work only continues from there.

Ultimately, winning clients is the most essential element of growing a business.

With that said, here are five tips for finding clients for your staffing business :

• Optimize your website and ensure it is captivating and inviting for new visitors
• Create a detailed client persona to help you understand who you’re marketing your business to
• Provide value for free through hosting webinars and workshops and writing blog posts
• Develop a referral program and ask connections (including existing clients) for referrals
• Personalize the experience by giving each lead individual attention and being flexible with contracts

In Summary: Creating a Business Plan for Your Staffing Agency

No two business plans will look the same. Your operational and growth plans might differ slightly from the blueprint laid out in this article or from the entrepreneur next to you.

What’s more important to remember is that a business plan isn’t just a document you put together and store away. It needs to be revisited and analyzed on a quarterly basis. Tracking goal progress, comparing actuals vs. forecast, and reviewing strategies will prove highly useful as you continuously strive to reach new heights with your staffing company.

Michael McCareins is the Content Marketing Associate at altLINE, where he is dedicated to creating and managing optimal content for readers. Following a brief career in media relations, Michael has discovered a passion for content marketing through developing unique, informative content to help audiences better understand ideas and topics such as invoice factoring and A/R financing.

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5 Steps to an Optimal Staffing Plan

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When your business is facing significant growth, it's crucial to get ahead of the need for talent with a staffing plan. Here are five steps to ensure that your organization has the right people with the right skills to achieve your growing business objectives.

A staffing plan helps ensure the workforce can meet the organization's business objectives.

A solid staffing plan pulls from multiple sources of information to identify and address ways to fill skill and experience gaps.

A good staffing plan is flexible and requires top-down support and organization-wide effort.

When your business is facing significant growth, it's crucial to get ahead of the need for new talent. A staffing plan backed by a methodical process helps ensure your organization has the right people with the right skills to achieve your growing business objectives.

What is a staffing plan?

A solid plan should go beyond changes in headcount to identify the new skills and knowledge your business needs while remaining sensitive to the relationship between internal and external needs.

A comprehensive strategic plan addresses three things:

• Short-term needs for a temporary or seasonal increase in employees
• Long-term needs for skills and positions needed for the foreseeable future
• Succession planning to ensure potential employees get the training and development needed for promotion into key positions

Why is a staffing plan important?

A solid plan creates a blueprint to ensure recruiting, retention and development efforts are aligned with the business needs. Without a proper plan, your organization may find itself scrambling to fill last-minute roles or losing multiple long-time employees who feel underappreciated.

5 steps to making a staffing plan

Here are five steps for creating a plan to help your organization keep up with its potential and ambitions.

1. Determine your goals

Simply put, the staffing plan must support the business plan. What is the organization's plan for growth? Does it need personnel to staff a new office or retail location? Is it hoping to multiply the size of its sales force to support a significant sales push? Does it intend to offer additional customer service or internal support to boost customer satisfaction?

These objectives are typically outlined in the business's strategic plan, so look there first to set up an alignment between talent strategy and desired outcomes.

2. Understand labor trends

Next, identify the labor trends that can impact the availability of personnel. Large national organizations should first review relevant data from the U.S. Bureau of Labor Statistics and ADP resources such as the National Employment Report and Pay Insights . These resources provide historical and up-to-date, sortable details on topics such as the number of job openings, unemployment rates, average labor costs, changes in employment numbers, and typical pay rates.

Large and small companies alike should examine similar statistics for their state or local region. This information is available from local chambers, business publications and industry associations.

As a bonus, these entities often synthesize the data to provide an overview of developments in the market. That can include new businesses or other larger employers increasing their hiring or laying off employees. All of these external factors affect the pool of talent available.

3. Determine the organization's functional needs

Keep in mind that not all personnel requirements necessitate hiring externally. Some of your organization's talent needs can be groomed internally, and others may be met by outsourcing to consultants, freelancers or independent contractors. That's why it's smart to assess the specific skills and abilities you need and ascertain whether each group, department or division already has those capabilities, either in-house or close at hand.

Ask whether training, mentoring or other development help current employees move up or over into the new or vacated positions. If so, what might this development look like? On the other hand, are these skills and personnel needed indefinitely for the long term? Or are the organization's needs more specific and short-term, like for a particular project, an initiative that calls for skill sets not found in-house or a time commitment simply not manageable for existing personnel?

4. Conduct a gap analysis

In essence, a gap analysis compares what you have with what you need. The difference or gap is what needs to be filled. Are the gaps your analysis identifies due to training and development deficiencies? If so, consider incorporating more training for the applicable functions or positions into your plan. Are the gaps due to heavy workloads during high seasonal demand periods? If so, think about hiring temporary workers or outsourcing to contractors.

A gap analysis isn't quite the same as generally determining functional needs. Asking a series of questions like the ones above will allow you not just to determine the gaps but also potential solutions for filling them.

5. Write out your plan's details

The final step is to roll all this information into an actionable talent plan. Once you have compared what you have with what you need, it's time to get granular with a plan that's tailored to your organization. Include factors like:

• Current workforce . Understand where employees are and where they're headed. Span all applicable groups, departments and divisions. Look at the current organization chart to identify current roles and career paths. Be sure to consider cross-functional opportunities when looking at career paths.
• Staff composition . Think about the employee's job title or function, salaries, length of employment, level of seniority, employee demographics, performance assessments and turnover rates. If you need seasonal customer service employees, you might include outsourcing in your plan.
• Employees' skills . Compare employees' key skills and experience with those needed, and use those gaps to determine your next steps. If you need midlevel employees with specialized software skills, you might look internally for people who have those skills or could acquire them. Likewise, you could plan to work with recruiters, schools or technical organizations for candidates.
• Career pathways . Work with HR and managers to create development plans for critical employees who have the most needed skills or who have significant potential for senior-level positions. These development plans go beyond performance reviews by outlining the steps an employee needs to reach the next level. This might be through specific job experiences, training or mentoring.
• Employee retention . Examine how well your organization retains employees. Look at turnover rates by position, department and demographic. Is there a pattern to which employees are leaving? If so, delve into possible causes to determine if people, policies or practices are impacting retention, which affects your staffing needs. Are employees receiving development opportunities, promotions and salary increases? What issues have surfaced from employee satisfaction surveys that might impact turnover? If you identify problems, work on a plan to increase employee engagement.

Once you gather all of the information and create a plan that identifies the anticipated job, skill and experience needs and includes details on how you plan to meet those needs, you can follow the necessary steps to implement the plan. Then, evaluate your implemented plan every six to 12 months or more often if your business changes significantly. The plan needs to be flexible to meet changing needs.

Staffing plans need everyone to pitch in

Crafting a truly high-quality staffing plan involves organizational leadership, hiring managers and HR leaders. It's an organization-wide effort not unlike budgeting. So clear communication across functions and departments is key to crafting a plan that accounts for the needs of all and works for everyone.

Hiring and keeping your best requires greater people intelligence. Get our guide: How to Design a People-Centered Workplace

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• Sample Business Plans
• IT, Staffing & Customer Service

Staffing Agency Business Plan

As the job market becomes increasingly competitive, businesses are looking for innovative ways to attract and retain top talent. It is where your staffing agency will become profitable.

Are you looking to start writing a business plan for your staffing company? Creating a business plan is essential to starting, growing, and securing funding for your business. We have prepared a staffing agency business plan template for you to help in start writing yours.

Free Staffing Agency Business Plan Template

Download our free business plan template now and pave the way to success. Let’s turn your vision into an actionable strategy!

• Fill in the blanks – Outline
• Financial Tables

How To Write A Staffing Agency Business Plan?

Writing a staffing agency business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section of the business plan intended to provide an overview of the whole business plan. Generally, it is written after the whole business plan is ready. Here are some components to add to your summary:

Start with a brief introduction:

Market opportunity:, mention your services:, management team:, financial highlights:, call to action:.

Ensure you keep your executive summary concise and clear, use simple language, and avoid jargon..

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2. Business Overview

Depending on what details of your business are important, you’ll need different elements in your business overview, But there are some foundational elements like business name, legal structure, location, history, and mission statement that every business overview should include:

About the business:

Provide all the basic information about your business in this section like:

• The name of the staffing agency and the type of agency you want for example are you writing it for a nurse staffing agency, medical staffing agency or any direct hiring firm.
• Company structure of your staffing agency whether it is LLC, partnership firm, or some other.
• Location of your staffing company and the reason why you selected that place.

Mission statement:

Business history:, future goals:.

This section should provide an in-depth understanding of your recruitment business. Also, the business overview section should be engaging and precise.

3. Market Analysis

Market analysis provides a clear understanding of the market in which your business will run along with the target market, competitors, and growth opportunities. Your market analysis should contain the following essential components:

Target market:

Market size and growth potential:, competitive analysis:, market trends:, regulatory environment:.

Some additional tips for writing the market analysis section of your Recruitment agency business plan:

• Use a variety of sources to gather data, including industry reports, market research studies, and surveys.
• Be specific and provide detailed information wherever possible.
• Include charts and graphs to help illustrate your key points.
• Keep your target audience in mind while writing the business plan

4. Products And Services

The product and services section of a staffing company business plan should describe the specific services and products that will be offered to customers. To write this section should include the following:

List the services:

• Create a list of the services that your staffing agency will offer, which may include all the services for example, will the agency offer temporary staffing, temp-to-perm staffing, direct hire placement, or a combination of these services?
• Describe each service: For each service, provide a detailed description of what it entails, the time required, and the qualifications of the professionals who will provide the service. For instance, do you need a full-time HR or some other personnel specific for interviews?

Screening and Placement Process:

Overall, the product and services section of a recruitment firm business plan should be detailed, informative, and customer-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key points to include in your marketing plan:

The partnership is a blessing:

Have a competitive fee structure:, marketing strategies:, customer retention:.

Overall, the sales and marketing strategies section of your business plan should outline your plans to attract and retain customers and generate revenue. Be specific, realistic, and data-driven in your approach, and be prepared to adjust your strategies based on feedback and results.

6. Operations Plan

When writing the operations plan section, it’s important to consider the various aspects of your business operations. Here are the components to include in an operations plan:

Hiring plan:

Operational process:, client management:.

By including these key elements in your operations plan section, you can create a comprehensive plan that outlines how you will run your staffing business.

7. Management Team

The management team section provides an overview of the individuals responsible for running the staffing agency. This section should provide a detailed description of the experience and qualifications of each manager, as well as their responsibilities and roles.

Key managers:

Organizational structure:, compensation plan:, board of advisors:.

Describe the key personnel of your company and highlight why your business has the fittest team.

8. Financial Plan

When writing the financial plan section of a business plan , it’s important to provide a comprehensive overview of your financial projections for the first few years of your business.

Profit & loss statement:

Cash flow statement:, balance sheet:, break-even point:, financing needs:.

Remember to be realistic with your financial projections, and to provide supporting evidence for all of your estimates.

9. Appendix

When writing the appendix section, you should include any additional information that supports the main content of your plan. This may include financial statements, market research data, legal documents, and other relevant information.

• Include a table of contents for the appendix section to make it easy for readers to find specific information.
• Include financial statements such as income statements, balance sheets, and cash flow statements. These should be up-to-date and show your financial projections for at least the first three years of your business.
• Provide market research data, such as statistics on the size of the staffing industry, consumer demographics, and trends in the industry.
• Include any legal documents such as permits, licenses, and contracts.
• Provide any additional documentation related to your business plans, such as marketing materials, product brochures, and operational procedures.
• Use clear headings and labels for each section of the appendix so that readers can easily find the information they need.

Remember, the appendix section of your employment agency business should only include relevant and important information that supports the main content of your plan.

Download a sample staffing agency business plan

Need help writing your business plan from scratch? Here you go; download our free staffing agency business plan pdf to start.

It’s a modern business plan template specifically designed for your staffing agency business. Use the example business plan as a guide for writing your own.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

This staffing agency business plan sample will provide an idea for writing a successful staffing agency business plan, including all the essential components of your business.

After this, if you are still confused about how to write an investment-ready staffing business plan to impress your audience, then download our staffing agency business plan pdf.

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Frequently asked questions, why do you need a staffing agency business plan.

A business plan is an essential tool for anyone looking to start or run a successful recruitment business. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your staffing agency.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your agency.

How to get funding for your staffing agency business plan?

There are several ways to get funding for your staffing business, but one of the most efficient and speedy funding options is self-funding. Other options for funding are

• Bank loan – You may apply for a loan in government or private banks.
• Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria first before you can apply for it.
• Crowdfunding – The process of supporting a project or business by getting a lot of people to invest in your staffing agency, usually online.
• Angel investors – Getting funds from angel investors is one of the most sought options for startups.
• Venture capital – Venture capitalists will invest in your business in exchange for a percentage of shares, so this funding option is also viable.

Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.

Where to find business plan writers for your staffing agency business?

There are many business plan writers available, but no one knows your business and idea better than you, so we recommend you write your employment agency business plan and outline your vision as you have in your mind

What is the easiest way to write your staffing agency business plan?

A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any staffing agency business example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Staffing Agency Business Plan Example

Published Jan.10, 2024

Updated Jun.03, 2024

By: Jakub Babkins

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Table of Content

What Does the Staffing Agency Mean?

A staffing agency, also known as a recruitment agency, employment agency, or temp agency, is a business that connects companies looking to hire temporary or permanent employees with qualified candidates looking for job opportunities. As per an HR consultant business plan to grow a staffing agency, staffing agencies focus on recruiting, screening, and placing workers in various roles across different industries. A staffing agency can also offer other services, such as payroll, training, background checks, and performance evaluations.

A staffing agency can operate in different ways, depending on the service it provides. Some common types of staffing agencies are:

• Temporary staffing agency
• Contract staffing agency
• Permanent staffing agency

Refine Your Strategy for Building Your Staffing Agency Business

To write a recruitment agency business plan, you need a clear strategy. Your strategy should include your vision, mission, goals, values, target market, niche, and competitive advantage. These are some questions to guide your strategy:

• Vision – What impact do you want in the industry and society?
• Mission – Why does your business exist, and how will you achieve it?
• Goals – What are your short-term and long-term objectives, and how will you measure them?
• Values – What are the principles that drive your actions and decisions?
• Target market – Who are the employers and workers you want to serve, and what are their needs and preferences?
• Niche – What segment or industry do you want to specialize in?
• Competitive advantage – What makes you different and better than your competitors?

Your strategy will help you structure your business plan for a staffing agency company. A business plan, like a headhunter business plan , is a document that outlines your business details, such as your products and services, market analysis, marketing plan, operations plan, management team, and financial plan. A temporary staffing agency business plan can help you share your vision, get funding, find partners, and grow your business.

Here are the main sections of a staffing agency business plan template and what they should include:

Executive Summary

This sample business plan for staffing agency is for StaffSpur, an Austin-based staffing agency for the IT sector, founded in 2024 by Hana Doe, an experienced IT professional. StaffSpur links IT talent with opportunity. StaffSpur offers staffing services to employers of all stripes. For workers at any career stage, StaffSpur provides career coaching, resume help, interview prep, feedback, and training.

StaffSpur has an IT edge and network and uses advanced technology to match candidates and opportunities and ease the hiring process. It aims to be the best IT staffing agency in Texas, to go global, and to impact the IT community and society positively. StaffSpur’s financial summary shows a low startup cost of $50,000, a breakeven point of 6 months, projected revenue of $1.5 million, and a profit of $300,000 in the first year.

Company Overview

StaffSpur is an Austin, Texas-based IT staffing agency founded in 2024 by Hana Doe, an IT professional with over ten years of experience. Hana saw a gap in quality, personalized IT staffing services. Hana started StaffSpur to serve employers and workers in the sector. Since launching, StaffSpur has grown to over 100 clients and 500 candidates with positive feedback.

StaffSpur is a sole proprietorship LLC run by Hana Doe, the CEO/manager. She leads the strategy, vision, marketing, sales, and customer relations and has a team of 5 for staffing services. Tapping into Austin’s booming tech scene fuels StaffSpur’s competitive edge – abundant talent and opportunities at their doorstep.

Industry Analysis

The US national temp/contract staffing sales amounted to $144.2 billion, with over 37,000 estimated staffing offices in the US ( American Staffing Association ). The industry has grown 3% annually, driven by economic recovery and trends like the gig economy.

According to IBISWorld , the Employment and Recruiting Agencies industry in Texas is on the rise which the following numbers showcase clearly:

• Texas Market Size: $3.1 bn
• Number of Businesses in Texas: 1,190
• Texas Industry Employment: 29,788

The Austin metro area has a thriving, diversified economy that drives talent demand across sectors like technology, real estate, healthcare, government, and construction. Unemployment is 4.1% ( Federal Reserve Bank of Dallas ), indicating a strong labor market.

While substantial competition exists for high-volume administrative roles, few staffing firms focus specifically on specialist IT placements. This represents an attractive niche opportunity that StaffSpur will capitalize on through our experience and networks.

Customer Analysis

StaffSpur’s target market consists of:

• IT employers

IT Employers

IT employers are companies needing IT talent for projects or operations. StaffSpur works with small, large, startup, and established firms. StaffSpur provides temporary, permanent, or temp-to-perm staffing services based on employer needs.

IT employers have these needs:

• Finding qualified, skilled IT talent
• Saving time and money by outsourcing hiring
• Improving quality and performance by hiring the best talent

IT employers prefer:

• Competitive pricing with quality and value.
• Highly skilled, experienced workers with relevant credentials.
• Fast, efficient services for timely hiring.
• Reliable, professional services following agreed terms.

IT employers:

• Rely on StaffSpur to source and screen candidates.
• Expect regular, transparent updates from StaffSpur on hiring.
• Decide who to hire based on StaffSpur’s recommendations.

IT workers are the technical professionals that StaffSpur helps find jobs. StaffSpur works with IT professionals across various specializations. StaffSpur offers IT workers temporary, permanent, or temp-to-perm job placements based on their preferences.

IT workers have these needs:

• Finding challenging and meaningful work
• Developing their careers by working on innovative projects
• Earning competitive compensation and benefits
• Working for reputable companies that provide growth opportunities

IT workers prefer:

• Access to a range of job opportunities.
• Guidance on finding the best roles based on their career goals.
• Help preparing for interviews and negotiating offers.
• Smooth onboarding experience at new companies.

IT workers:

• Rely on StaffSpur to source relevant openings.
• Expect regular updates on job search progress from StaffSpur.
• Decide which jobs to pursue based on various factors.

Competitive Analysis

StaffSpur faces competition from both direct and indirect competitors in the staffing industry. Some of the main competitors are:

• Direct competitors – These are staffing agencies that focus on the IT sector, such as Techstaff, IT Works, and Initech who provide similar staffing services to StaffSpur, but they have drawbacks, such as high prices, low quality, slow speed, unreliable, or poor reputation.
• Indirect competitors – These are businesses that offer different staffing solutions to the IT sector, such as online platforms, freelance networks, or in-house recruitment who provide diverse staffing services to StaffSpur, but they have problems, such as low security, less flexibility, complexity, or less support.

StaffSpur stands out with its IT sector expertise and network of IT professionals and companies that help in improving matching candidates and simplify hiring.

Marketing Plan

StaffSpur is a leading IT staffing agency in Texas with a large and loyal customer base. StaffSpur’s marketing strategy aims to:

• Boost brand awareness and reputation among Texas IT employers and workers.
• Attract and retain more customers and candidates through referrals and conversions.
• Foster long-lasting, mutually beneficial relationships with customers and candidates.

StaffSpur’s marketing mix includes:

• Product – Offers temporary, permanent, and temp-to-perm staffing. Also provides career coaching, resume writing, and interview prep. Caters to IT employers’ and workers’ needs, delivering value and quality.
• Price – Charges fair, competitive fees or commissions based on worker salary or employer budget. Gives discounts and incentives like free trials, referrals, and loyalty programs.
• Place – Based in Austin with access to the large, diverse local IT market. Uses online platforms like its website, social media, email, and chat to reach and serve customers remotely.
• Promotion – Communicates services, benefits, and brands through online and offline channels. Relies on word-of-mouth, referrals, testimonials, and reviews to build trust and generate buzz.

StaffSpur’s marketing budget is $150,000, 10% of its projected revenue in the first year. StaffSpur’s marketing budget has three parts:

• Online marketing: $75,000
• Offline marketing: $45,000
• Marketing research and evaluation: $30,000

Operational Plan

StaffSpur’s operations plan is how it runs and manages its IT staffing business, using the best practices and standards in the industry. StaffSpur’s operations plan has one component:

• Business processes – StaffSpur’s business processes are the steps it takes to provide staffing services. The four stages are:
• Sourcing: Finding and attracting IT workers and employers through online platforms, referrals, and events.
• Screening: Checking and assessing IT workers and employers through interviews, tests, and background checks.
• Placing: Matching and connecting IT workers and employers, assisting with hiring and placement like contracts, agreements, and payments.
• Managing: Supporting and monitoring IT workers and employers, providing feedback, training, and solving any issues.
• Business systems – StaffSpur uses technologies and tools to support and improve its business processes. StaffSpur’s business systems are: 
• Website: Online platform showing services, benefits, and brand. Provides information and resources.
• Software: Applications and programs to manage and automate operations, like CRM, HRM, and accounting.
• Hardware: Devices and equipment to run and access software and systems, like computers, phones, and printers.
• Network: Infrastructure and connections to link and secure hardware and systems like the internet, cloud, and blockchain.

Management Team

StaffSpur’s management team has one person: Hana Doe, the founder, owner, and CEO. Hana leads the business and oversees everything. Hana also hires and supervises five staff who recruit, screen, place, and administrate. Hana’s management profile is:

• Name – Hana Doe
• Role – Founder, owner, and CEO of StaffSpur
• Background – Hana has a bachelor’s in computer science and a master’s in business administration. She has 10 years of IT experience as a software developer, project manager, and consultant.
• Experience – Hana knows the IT sector and the staffing industry well. She has managed and delivered many IT projects. She has also worked as a freelancer and a contractor using various staffing agencies and platforms.

StaffSpur has a simple, flat management structure. Hana is the boss and reports to no one. The staff are workers who report to Hana. Hana and the staff communicate and collaborate regularly and openly.

Financial Plan

StaffSpur’s financial plan aims to achieve and maintain profitable, sustainable financial performance by:

• Generating sufficient revenue
• Controlling costs
• Managing cash flow

Financial Assumptions:

• $10 billion IT staffing market in Texas, growing 10% annually (industry data)
• 0.1% market share in year 1, increasing 0.1% annually based on strategy, competitive advantage, retention
• 20% fee/commission of worker salary or employer budget (workers get 80% of salary/budget, industry standard)
• Main costs are staff salaries, marketing, and office expenses. Assume a 5% annual increase from inflation and growth.
• 21% federal corporate tax, 0% state tax in Texas. Expenses and depreciation deducted.

Financial statements:

Balance Sheet – Shows assets, liabilities, and equity at a point in time. Measures financial health and liquidity.

Income Statement – Shows revenue, expenses, profit, and margins yearly. Measures profitability and efficiency.

Cash Flow Statement – Shows cash inflows/outflows from operations, investments, and financing. Measures liquidity.

Select the Legal Framework for Your Staffing Agency

Choosing the correct legal structure and entity formation is vital when establishing a staffing agency. The primary options we evaluated were:

• Sole Proprietorship
• Partnership
• Limited Liability Company (LLC)
• S-Corporation

The key considerations were liability protection, tax treatment, ease of setup, ownership flexibility, and ability to attract investors.

For StaffSpur, we determined forming an LLC provides the best advantages:

• Liability protection separates personal assets from business liabilities
• Pass-through taxation avoids double taxation
• Simple setup process compared to S-Corp
• Flexible ownership structure to add investors
• Credibility of formal company over sole proprietorship

We will form StaffSpur as an LLC, with Hana owning 100%. This allows us to obtain investment while retaining management control under Hana’s leadership. Refer to our holding company business plan for a better understanding.

Keys to Success

The key elements of starting a staffing agency startup business plan that will make StaffSpur’s business concept successful include:

• Specialized IT Expertise – Our deep IT networks and knowledge help identify and place great candidates, giving us an edge.
• Client Relationships – Strong partnerships through excellent service ensure repeat business and referrals for growth. We heavily invest time to understand each client’s needs.
• Rigorous Screening – Thoroughly vetting candidates’ skills, experience, fit, and background checks provides clients with exceptional, qualified talent that lowers turnover.
• Pricing – Competitive rates that offer client value and produce profits let us grow sustainably. Our niche also allows higher margins than generalist agencies.

By focusing on these core strengths, StaffSpur stands out from competitors as a top niche IT staffing agency in Austin.

Get Expert Help Building Your Staffing Agency Business Plan

At OGSCapital, our team of experienced business plan writers can provide invaluable guidance on creating a winning placement consultancy business plan or an employment agency business plan tailored to launch or grow your agency. For over 15 years, we have worked with hundreds of startups and businesses across industries to develop customized, investor-grade business plans, like the insurance agency business plan . Our IT staffing agency business plan clients span healthcare, technology, accounting, manufacturing, and more.

Whether you’re looking to secure SBA loans, pitch investors, a medical staffing business plan, or organize your strategy, we can assist with customized business planning services. From one-on-one consultation to complete written plans, we can help you understand how to start a staffing agency, maximize opportunities, and avoid pitfalls.

Reach out today to learn more about how to write a business plan for a staffing agency and how OGSCapital can help turn your staffing agency into a high-growth business.

Download Staffing Agency Business Plan Sample in pdf

Frequently Asked Questions

How profitable is a staffing agency?

As per a business plan template for a recruitment agency, an average staffing agency has a ~10% operating profit margin (EBITDA margin) after operating costs (salaries, admin expenses, etc.). However, this may vary depending on the agency’s industry, market, and client base. Generally speaking, staffing agencies make a profit margin of around 60% on the bill rate they charge to their clients.

What factors do you consider when developing a staffing strategy?

Key factors in developing a startup nonprofit employment agency include industry niche, target clients, talent supply, competitive landscape, geographic focus, value proposition, pricing, compliance, and technology/systems. Identifying a profitable niche where you can differentiate and build a robust talent pipeline to execute your strategy is vital.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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All About People

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">.

All About People (AAP) began out of the desire to contribute to this community, just as communities have fed All About People’s proprietor over the years. Although originally from a larger market, the proprietor realizes the need in the southern Willamette Valley for a personnel agency that fills a void left by other temporary and permanent placement agencies. AAP matches specifically skilled workers with clients, saving businesses time and money, while providing for its employees with honesty and honor. This requires a high level of communication. It means asking open-ended questions and listening, not talking. This means knowing the local market so AAP can really serve each client and employee, not just “sell” them our goods. AAP is quality service.

The long-term vision includes a number of offices throughout the southern Willamette Valley. The proprietor sees the challenge in this vision, not in the growth itself, but in training and encouraging all AAP personnel to treat each client and employee with the same care and with the same level of communication.

Managing our Growth AAP is a sole proprietorship that will convert to an S Corporation. As a new corporate entity, AAP will be treated as a start-up in this business plan. During the past couple of years the proprietor provided all services. In Year 1, the company will add a part-time office staff person and an employment specialist. In response to this growth, AAP will have a procedures manual for in-house staff to assure that the information is clear. In addition, AAP will provide employees with regular training within the divisions to assure they understand the details of the work they are doing daily. Year 2 projections include a receptionist, another employment specialist, and a field representative. In Year 3, AAP will examine the feasibility of opening a branch office in the Salem, Bend, or Medford/Ashland areas.

The Market AAP is structured like other temporary and permanent placement agencies. However, it will serve clients with needs for select, specialized professionals rather than clerical or light industrial workers. Several businesses in Portland, Oregon provide a similar service to specific groups of people, but there are none for the Willamette Valley. AAP has five divisions, targeting the following areas of expertise:

• Editors/Writers

Event Planners

Graphic Artists

• Interpreters/Translators.

Services AAP will handle recruiting, including reference checks, skills evaluation, preliminary interviewing,  and screening of all employees for its clients. AAP acts as an extension of the client’s human resource department, assuring that there is open communication between supervisor and employee, and assisting with any troubleshooting or problem solving that may be needed.

Financials The company’s start-up requirements are $55,464, of which $7,600 will be provided for by the owner’s personal investment. The rest will be obtained through loans.

We expect to be able to charge a 50% markup to our business clients. Thus, if an employee is being paid $10 per hour, we are charging the client $15 per hour. The company predicts that it will be able to produce sales of approximately $300,000 by Year 3. The company does not have any direct cost of sales; we track payments to placed individuals as regular payroll.

1.1 Objectives

AAP is structured like other temporary and permanent placement agencies. However, we serve clients with needs for select specialized professionals, rather than clerical or light industrial workers. Several businesses in Portland, Oregon provide a similar service to specific groups of people. AAP followed the model of one placement firm described below.

A contract engineering firm places temporary workers who are hardware and software engineers. Employees earn between $80- $100 per hour and approximately seven employees are placed per month. The firm recruits through its website, advertises in newspapers, magazines, and trade publications. Incentives offered to contingent workers include medical, dental, and disability insurance, 401(K), and a reference finder’s fee for placement referrals. They find their employees are 60 percent male, 40 percent female, and ages spread evenly.

AAP serves the business client by locating a professional worker, interviewing and screening that worker, setting up interviews if necessary, and administering all hiring paperwork. The company runs payroll and bills the client bi-monthly. AAP will also manage the professional, staying in close contact with the client and communicating with the worker regarding any personnel issues that may arise.

The professional worker is served with employment opportunities at no cost; pay rates that are within industry standards; and health insurance may be purchased, if a worker becomes eligible, at a group rate starting at $124/mo. AAP will pay $65/mo for any coverage chosen from the group package.

1.2 Mission

All About People’s mission is to contribute to the community by filling a need for specialized, professional, contingent workers. The company will provide workers with a safe and independent environment. It will also provide businesses with a high-caliber of employee available for project or permanent work. All About People listens to individual needs and customizes personnel solutions for both businesses and workers.

Company Summary company overview ) is an overview of the most important points about your company—your history, management team, location, mission statement and legal structure.">

AAP is a temporary and permanent placement personnel agency working solely with skilled, professional workers and Willamette Valley businesses. AAP differs from other temporary and permanent placement agencies because of our skilled workers. The company believes that the temporary industry pays only cursory attention to providing businesses highly qualified workers for permanent and non-permanent positions. AAP has five divisions, targeting the following areas of expertise:

AAP does not provide general clerical, light industrial, engineers, accountants, nurses, or other medical technicians.

AAP does the following for each client:

• Recruiting (reference checking)
• Skills evaluation (preliminary interviewing)

AAP conducts regular evaluations: AAP checks in with the supervisor and the worker during the first week on the assignment. AAP then checks in as agreed with the client. AAP acts as an extension of the client business’ human resource department assuring that there is open communication between supervisor and employee, and assisting with any troubleshooting or problem solving that may be needed.

Prior to opening our doors, research showed support for the development of a personnel agency working solely with professional contingent workers and Willamette Valley businesses (see topic 7.3 Supporting Research).

According to the Oregon Department of Employment, Lane County has 31 temporary agency firms with 3200 individuals employed. Total employment figures for Lane County are 250,000; therefore, we support between two and four percent of the population.

Through connections in a variety of areas, AAP is able to locate qualified workers not only through advertising, but through a channel of networking. This past year has shown that qualified, willing workers are certainly available as we currently have hundreds on staff willing and able to work.

2.1 Company Ownership

AAP is a sole proprietorship that will convert to an S Corporation. As a new corporate entity, AAP will be treated as a start-up in this business plan.

The sole proprietor, Sarah Wayland, can be reached at AAP’s office, [contact information omitted in this sample plan].

2.2 Start-up Summary

Projected start-up figures are shown in the chart and table below.

The company is uniquely positioned to take advantage of this market opportunity because of the management and field expertise of the proprietor. Sarah Wayland worked in the temporary employment industry for three years with ADIA Personnel Services (now ADECCO) as Area Account Manager (in training as a branch manager): building business relationships; hiring employees; handling employee issues; working with clients during the implementation of ADIA; and opening an additional office in Beaverton, Oregon.

For one year the proprietor was a District Sales Manager at Columbia Distributing, showing a 10% increase on $3.5 million in annual sales. Managing a staff of nine in sales and customer service, she had the opportunity to delve further into hiring/firing, reviewing, incentives outside of salary, and personnel issues.

Most recently, she has spent several years as Funds and Contracts Manager at the Oregon University System; managing four grants totaling $1.5 million annually and all personal service and interagency contracts as well.

The proprietor’s most notable success was bringing the second branch of Cellular West located in Portland, Oregon, from running in the red, to breaking even within four months of its opening. She accomplished this by using motivational tools and providing the sales force with extensive training.

3.1 Products and Services Plan

Changing labor market conditions threaten the concept of full-time permanent employment.

AAP provides a complex blend of services to distinct populations. The company serves businesses through connecting them with the professional contingent work force. It also serves the worker by connecting them with businesses, at no charge, and providing benefits not often provided by other employment agencies.

Market Analysis Summary how to do a market analysis for your business plan.">

All About People (AAP) is a local firm that costs less than a consultant or agency, provides for both project and long-term needs, and has an easy, pay and billing rate system that covers employee payroll and worker’s compensation insurance.

There are a variety of reasons why businesses may need AAP’s services:

• Spikes in work load
• Business expands into an area that in-house expertise does not yet match
• Special events
• Pregnancy leave or sabbatical
• Business increases after layoffs
• Smaller business does not yet have staff on-hand to complete extra projects.

According to economic forecasters, employment agencies and financial services are expected to have the largest industry growth over the next 25 years. The trend toward businesses cutting back on employees and their benefits due to high costs creates the demand for AAP’s services.

Just consider the time, energy, and resources an employer may spend trying to employ a person for a 20-hour task.

In addition to the already lucrative temporary industry, several companies in the Portland Metro Area place professional contingent workers, but the southern Willamette Valley is not currently being served.

The company approaches businesses primarily through networking and cold calls. Our intention is to utilize a PR agency for more coverage as soon as possible. AAP is a member of the area Chamber of Commerce and actively participates in as many activities as possible, the proprietor is a member of the Women’s Business Network, the Professional Women’s Organization, and we are in the process of connecting with the Society for Human Resource Management. Prior to start-up, AAP also surveyed several area businesses about their use of contingent workers. The company will use its website and other marketing materials that describe what services we provide and explain how simple it is to work with us.

AAP advertises in local papers and trade magazines when absolutely necessary, but most often uses the Oregon Employment Department, both community college and university campuses, and the networking groups we are members of to search out the right employee. Prior to the sole proprietor start-up, the company started recruiting by administering twenty personnel surveys and advertising locally to create a staff of qualified contingent workers. This staff will be unaffected by AAP’s corporate restructuring.

4.1 Market Segmentation

The market can be broken down into two segments: the business market segment, and the employee market segment. Both of these segments are lucrative.

Business market targets: The company targets the University of Oregon, Lane Community College, the nonprofit organizations, the publishing industry, the advertising industry, and other large businesses.

Employee market targets: Editors/writers, graphic artists, computer specialists, event planners/fundraisers, and language translators/interpreters working in the business target markets listed above, as well as any applicants with unusual skills and talents.

4.2 Service Business Analysis

These charts demonstrate the types of workers employed, the type of qualified professionals on file to work for the company, and the types of businesses who have used AAP’s services. These statistics cover the 15-month sole proprietorship period from July 1, 1998 through September 30, 1999.

Types of workers employed by or signed up with AAP

Types of employers using AAP

Each and every contact is entered into the database-either in the professionals file if they are a potential candidate, or in the contacts file if they are another type of contact. The client and jobs files utilize the contact and client numbers to automatically fill in the information from the contact or client files. This means no duplicate typing. In addition, the contacts, clients, and professional files all have follow-up sheets attached making daily follow-up easy. Simply pull the file up for that day and all calls that need to be made that day will be marked.

Searching is easy. The check boxes within each professionals file allows us to check for singular or multiple skills and experience with a click and a return.

4.2.1 Competition and Buying Patterns

First form filled out from the moment the candidate calls. Three screens constitute one file: Personal Information; Job Information; Skills. The professional and contact files have a conversation record that will allow easy follow-up with a list daily of those records needing a call.

Interview Form

Directly from the employee forms the Employment Specialist can select the appropriate interview form. This form consists of three sheets: Basic Questions; Other Information/Recommendations; and Reference Checks.

Employee Profile Sheet

From the above information, a profile sheet is generated in hard copy for the inside of each file. This is our second backup system (besides the tape drive) in case of a power outage, etc.

4.2.2 Contact Sheet

This form is used for all other contacts. From here, a contact can be turned into a client by merely typing the contact number in on the client sheet, automatically bringing in all of the information.

4.2.3 Client Sheet

The client sheet is easily created by filling in the contact number. All pertinent information is automatically entered. The client sheet has its own contact sheet attached generating a daily follow-up list. The client files can also be pulled into a handy contact list.

Strategy and Implementation Summary

AAP is completely service minded, customizing personnel packages and offering the most it can to both employers and employees. The company brokers professional workers to Willamette Valley businesses. Because we serve two distinct groups of people, both businesses and employees will be considered equally important to AAP.

The company consists of five divisions, targeting the following types of workers and needs in businesses:

Computer Division

• Computer Application Specialists
• Computer Hardware Specialists
• Computer Programmers
• Network Administrators
• Web Specialists

Editor/Writers

• Multi-lingual
• PR/Marketing
• Fundraisers
• Large and Small

Language Interpreters and Translators

• Multiple Languages
• Person-to-Person

Within these categories, we originally set up a system of single sheets on card stock and filed them in binders. Since then, an electronic database has been created by one of our professionals. With the push of a button, AAP can search for a client or an employee needed.

Businesses and employees will be able to communicate with AAP via both new technological and traditional methods. Our Web page provides information about AAP including what professional fields we serve, what clients we are working with, and what services we offer. A second-generation Web page will provide information about employees for businesses through a password-protected area. AAP forwards candidates’ resumes and other information through a variety of methods: phone, fax, personal visit, mail, and the Web page.

In August 1999 we moved the offices to the center of town. Accounting is handled electronically by the proprietor through QuickBooks, with the complex needs handled by our CPA. All payroll is generated through the payroll service, Paychex. The office is furnished with all of the technology needed to operate on a daily basis, increase market share, and serve clients.

5.1 Competitive Edge

When a business is contacted and expresses interest in contingent employees that the company can provide, the following procedures will be followed:

• Consult with client and create a follow-up plan.
• Complete the contact, client, and job sheet in the database.
• Print one of each and forward a copy of the job sheet on yellow paper to the employment specialist.
• File original sheets in the appropriate binders.
• Search for matches in the database and pull each folder that looks like it will work.
• Review that folder to assure a match.
• Call each potential candidate and discuss the job and pay to its fullest.
• Fax, e-mail, or otherwise contact client with information and/or resumes for review.
• Schedule interviews or make a decision on appropriate candidates.

5.2 Sales Strategy

When an employee seeks to work with the company, the following procedures will be followed:

• Complete the professional’s form in the database.
• While completing this sheet, screen the employee for experience levels, requiring professional experience in each arena they wish to work.
• Set up an interview with the employment specialist if the professional is qualified.
• Create a file for each employee and place all paperwork, along with a copy of the professional’s form.
• Keep in touch with the professional quarterly if nothing comes up, more often if at all possible.
• When the professional agrees to a position, they will be supplied with an employee policy manual, pieces of letterhead for invoicing, and will complete the IRS I-9 and W-4 forms prior to beginning work.

5.2.1 Sales Forecast

Our sales forecast projections are presented in the chart and table below. Three years annual projections are shown in the table.  The chart shows first year monthly forecast.  First year monthly table is included in the appendix.

5.2.2 Target Market Segment Strategy

The pay rate data will be determined by changing market factors including business demand.

Our experience shows that the following is true in regards to pay and bill rates. A “good deal” for most temporary agencies is a 50% of pay rate markup. Thus, if the pay is $10, the bill is $15. However, we have traditionally used a flat markup that seemed appropriate. Pay and bill rates generally are outlined as follows:

Editors Most editors require between $25 and $35 per hour, and our history has shown a $10 per hour markup is acceptable. One exception is in the technical arena, garnering between $45 and $55 per hour pay; again a $10 per hour markup is typical.

Writers The only writing we have done is creative for [client name omitted], and we paid $15 with a $10 markup.

Event Planners Event planners often will work for between $12.50 and $25 per hour, depending on the length of the job, requirements, and experience needed. We find a $5 per hour markup on the $12.50-$17.50 is reasonable, and a $10 per hour markup on anything over $17.50 per hour.

Fundraisers Fundraisers can start at $10 per hour (nonprofit) and go up to $20 per hour. This usually depends on client and length of assignment. Bill rate markup for nonprofits is $5 per hour, others between $7.50 and $10 per hour.

Graphic Artists Entry level beginning at $12.50 per hour, intermediate at $15 per hour, and a top of the line professional at $25 per hour. The exception may run about $50 per hour. Bill rates are between $7.50 per hour markup ($12.50-$15), and $10 markup.

Language Interpreters This is a tricky arena. Pricing depends on the language (typical/atypical) and the length of the assignment. Interpreters have been known to work for as little as $15 per hour and for as much as $35 per hour. A $10 per hour markup is acceptable.

Language Translators This division is difficult as each language and situation varies slightly. Translators tend to work by page or by word. Technical translation can be as much as $.30 per word. Other translation can be $10 per hour (an hour a page). We are unsure of markup at this time, but would suggest 50% of pay rate.

Computer Specialists:

• Application-Starting at $12.50 an hour based on Xerox experience. Markup $5 per hour.
• Programmer-Starting at $20 an hour based on AlbertIQ experience. Markup $10 per hour at a minimum. Try for $15.
• Web Designer-Entry level positions can start at $10 per hour with a markup of $5. Project work typically starts at $15 an hour, markup at least $10 per hour.
• Administration-Pay rates range between $50 and $75 per hour, with a preferred markup of $25 per hour.

When determining the bill rate, additional expense factors to remember above the pay rate are 15% employer taxes, advertising, and staff time to fill the position.

5.3 Milestones

The company has an outstanding client list and an incredible number of qualified employees available. AAP has a good reputation for providing qualified people in a timely manner.

Management Summary management summary will include information about who's on your team and why they're the right people for the job, as well as your future hiring plans.">

In a variety of settings the proprietor of AAP has strong management experience. The proprietor has the skills to not only listen well, drawing out a person’s needs through open-ended questions, but also has the ability to recognize people’s strengths and weaknesses. She will draw upon this extensive successful experience in addition to the knowledge collected over a period of 18 years working professionally. Much of the “people” skills have been developed during the seven years spent in management roles. This experience, along with a varied background, supports AAP’s goals.

AAP’s objectives are threefold:

• To provide high quality, experienced, professional workers to businesses that are currently relying on the instability of word-of-mouth contacts, and are spending much of their time and resources (and, therefore, money) locating such workers;
• To provide these workers with a path by which to reach the employer without spending their own time, money, and energy finding the work; and
• To use this opportunity to make the contingent work force a better place for both the employer and the employee.

The long-term goal of the company is to franchise and/or to become multi-location, and eventually sell this business.

Management is a style, a belief, and a strategy.

In managing our clients, AAP will communicate regularly with them, setting up a schedule that meets their needs. The company will set goals for retention of clientele and strive to reach those goals by building relationships, listening to the client’s needs, and meeting those needs with a smile on our faces. We will take responsibility for our errors and the outcome.

In managing our workers, AAP will communicate regularly with them, providing them with an employee manual to minimize their confusion, and offer them the best pay and benefits possible. AAP will set goals for retention of employees and strive to reach those goals by treating each employee with respect, provide protection when appropriate, and do everything within our power to assure a healthy working environment.

This is a relationship business. AAP will manage all clients and employees through relationship building.

During 1998-99 the proprietor provided all services. In 2000 the company will add a part-time office staffer and an employment specialist. In response to this growth, we will have a procedures manual for in-house staff assuring that the information is clear. In addition, we will provide employees with regular training within the divisions to assure they understand the details of the work they are doing daily. 2001 projections include a receptionist, another employment specialist, and a field representative. In 2002 AAP will examine the feasibility of opening a branch office in the Salem, Bend, or Medford/Ashland areas.

6.1 Payroll

All About People runs its payroll twice a month. Each professional will be given a check schedule when they work with AAP. Each check covers the previous two weeks.

In order to process payroll; AAP must receive a professional’s signed invoice the Wednesday prior to payday. The invoice, must be on AAP letterhead and include: name, social security number, mailing address, dates of work completed, location worked (at home, at the client’s office), one or two sentences describing what tasks were completed, and how much time was spent each day. At the bottom there must be a place for the client to sign and date in acceptance of the work to date. The original will be submitted to AAP, the client will receive one copy, and the professional will keep a copy.

AAP is unable to provide payroll advances. If a check is lost in the mail, we must wait seven days from the date of mailing, and then if the check has not arrived we will stop the check at the bank and have one reissued.

6.2 Benefits

Because we value our employees, we have employee group health insurance available, and contribute a major portion of the monthly premium. According to the Insurance Pool Governing Board (IPGB) employees must work at least 17.5 hours per week. Employees who work intermittently or who have worked fewer than 90 calendar days are not eligible. IPGB also states that all carriers may decline to offer coverage to the business or to any employee.

Technically, All About People is employer of the professionals we place. This means that we are responsible for covering the worker’s compensation insurance, running payroll, and that we are the ones to whom each employee is responsible. We understand that this can be tricky when employee professionals are working with a client, so we want to describe the expectations of this relationship:

• If the professional doesn’t understand the work or assignment that has been given by the client, then discuss the work with the client.
• If there are issues at work, the employee should inform AAP and then speak with the client.
• If these issues continue, the employee should talk with AAP immediately.
• If the professional feels they are being harassed at work they should let AAP know immediately.
• If the employee should be being asked to perform tasks other than the original assignment, the employee should talk with AAP before beginning any tasks other than the original assignment.
• If the professional is being asked to work overtime (more than 40 hours per week), they should let us know immediately.

AAP does not guarantee either work or wages when you join us to become an AAP employee. We will, of course, strive to keep you as busy as possible. AAP is also not able to guarantee an hourly wage prior to the assignment beginning. If you work on a job, and complete the work successfully, you will be paid at the agreed rate.

This employment relationship differs from others because you, AAP, or the client may end your employment with or without notice and with or without reasons. However, if you accept a job with AAP, we do expect you to finish the assignment.

Marketing Strategy

AAP’s target market is both businesses and professional workers. Phase one of the marketing plan will target the University of Oregon, the technology industry, and the top 500 businesses in Eugene through networking and cold calling. Phase two will target small businesses with less than five employees because smaller businesses may not have the in-house capability to locate, evaluate, and hire potential professional contingent workers through a small PR campaign.

7.1 Businesses

We began marketing the businesses through several personnel surveys. The University of Oregon Alumni Association, University of Oregon Foundation, and University of Oregon Human Resources Department, as well as Symantec’s Human Resources director were approached for information regarding their need for professional temporary and permanent workers. These initial interviewees have all (with the exception of U of O HR Dept) become clients within the first year of business. After these personnel surveys were complete, we adjusted our recruitment of professional workers to meet the demand.

Another tactic was joining multiple business groups. AAP became a member of the Eugene Chamber of Commerce and attends the weekly greeters meetings; the Women’s Business Network and attends the monthly meetings; the Professional Women’s Organization and attend the monthly meetings; as well as the City Club, keeping a pulse on what is happening in the community, attending as the proprietor sees fit.

The next approach is face-to-face cold calls. The tools for these calls are simple-a business card and a brochure. The information collected during the cold call is vital: how many employees does the business have; in what areas have they experienced a need for professional contingent employees; and who is the appropriate contact.

7.2 Professional Workers

Our beginning point in marketing to workers was approximately 30 personnel surveys to professional contingent workers, building the foundation of our database.  AAP intends to recruit workers through advertising in the newspaper and appropriate trade magazines, trade shows, the University of Oregon career center, and by referral. We have found that each division within the company requires a different approach for recruitment. We try not to depend on newspaper advertising as we find the results are moderate. Results are far better with the employment department for some areas, with the U of O for others, and also through a series of developed contacts for the other divisions.

7.2.1 Trust

In order to build trust with both businesses and employees AAP will follow through as promised. We will treat each business, employee, and ourselves, with integrity. AAP will communicate clearly, asking businesses to specify the needs for follow-up service during the time that they employ our contingent worker. We will work with employees to assure that they have a clear understanding of what AAP offers and what we expect of them.

7.3 Supporting Research

“A fading model of employment in the United States envisions a business enterprise with full-time employees who can expect to keep their jobs and perhaps advance so long as they perform satisfactorily and the business continues. Changing labor market conditions threaten the concept of full-time permanent employment. As reported by the Conference Board in September 1995, contingent workers account for at least 10 percent of the workforce at 21 percent of the companies surveyed, or almost double the 12 percent of respondents with that number in 1990. Writing in the Monthly Labor Review in March 1989, Belous estimated that contingent workers constitutes 24 to 29 percent of the labor force in the United States. In August 1995, however, the U.S. Bureau of Labor Statistics (BLS) estimated the size of the contingent labor force at 2 to 5 percent of the total workforce. However, BLS did not count long-term part-time employees, who constitute 90 percent of part-time workers.”       — Society for Human Resource Management, The Contingent Worker: A Human Resource Perspective, by W. Gilmore McKie & Laurence Lipset taken from Chapter 1, What Is a Contingent Worker?

AAP is a service company providing businesses with customized personnel solutions by connecting them with the professional contingent work force. Research suggests that 2000 is an opportune time to be in the Eugene market with this service. Even with all of the evidence that contingent work is the wave of the present, and of the future, the niche of placing contingent workers who are paid $12.50 to $40 per hour is untapped in the Eugene area. However, a few companies place high-end contingent workers in the Portland area.

There are many reasons why businesses are turning to contingent workers. The Economic Policy Institute’s article “ Contingent Work ” by Polly Callaghan and Heidi Harmann explains that:

“Growth in involuntary part-time employment is causing total part-time employment to grow faster than total employment. Another indication of the shift toward part-time workers: hours for part-time workers are growing faster than hours for full-time workers. Temporary employment has grown three times faster than overall employment and temporary workers are being used for more hours. Contingent employment is growing faster than overall employment. Part-timers are disproportionately women, younger, or older workers. There has been a shift away from manufacturing toward trade and services. These structural changes help explain the growth in part-time employment.”

Because of the changing nature of jobs themselves, AAP’s services are desirable to employers of all sizes. Unlike five or ten years ago, many positions are so diversified, or specialized, that it is not financially feasible for an employer to hire a person to fill one position, requiring several areas of expertise. This is not financially wise for the business because of the pay range required to recruit and hire such a talented person (especially in areas such as graphics, design, etc.). The cost of payroll, taxes, benefits, and other miscellaneous staff required to run employees add to the burden of a downsized staff. Contacting AAP and using a professional contingent worker for each portion of a position as needed will solve this dilemma. Currently most businesses locate needed “qualified” workers by word of mouth. With one phone call, e-mail, or connection with our Web page, AAP makes the task easy.

In addition, Oregon’s economy is expected to continue growing, and employment, total personal and per capita income, and population growth rates are expected to exceed the national average (according to the 1997-98 Oregon Blue Book). Although Oregon’s economy is among the best there is an obvious group of contingent workers available to build an employee labor pool. The company draws from a labor pool of qualified contingent workers which consists of people who work at home, retirees, others who wish to work part-time. According to the Oregon University System, approximately 33% of bachelor’s degree graduates will be unable to find jobs in Oregon each year. So, recent college graduates are also a part of AAP’s labor pool.

Research shows that a large percentage of workers who tend to work more than one job are well-educated individuals who have a higher degree of education. According to Oregon Employment Department’s Occupational Outlook Quarterly , Spring 1997, 9.4% have Ph.D.’s; 6.5% a Professional degree; 9.1% a Master’s degree; 7.9% a Bachelor’s degree; 7.9% an Associate degree; and the remaining 15.8% lesser education. According to a Personnel Journal article “ Contingent Staffing Requires Serious Strategy ,” April 1995, there are also many retirees that enjoy doing contingent work.

Financial Plan investor-ready personnel plan .">

The following sections contain the financial information for All About People. Tables show annual projections for three years. Charts show first year monthly figures.  First year monthly tables are included in the appendix.

8.1 Important Assumptions

The financials of this plan are predicated on the following table of assumptions.

8.2 Projected Profit and Loss

Profit and Loss figures are projected in this table.

8.3 Projected Cash Flow

Our cash flow estimates are shown in the chart and table below. The owner expects to invest further amounts in the business over the next two years to finance continued growth.

8.4 Projected Balance Sheet

Three year annual balance sheets estimates appear below.

8.5 Business Ratios

The table below presents important business ratios from the help supply services industry, as determined by the Standard Industry Classification (SIC) Index code 7363, Help Supply Services.

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• The 7 Step Business Plan for a Medical Staffing Agency

By Adam Day

• Uncategorized

April 22, 2021

A strong business plan can make or break a new startup. Therefore, if you’re looking to open a healthcare staffing agency, a solid business plan should be your first port of call.

Not only does it provide a clear road map for getting your business up and running, it’s also the first step in applying for a business loan. Furthermore, with so much to handle from financing to legal protection, the act of writing it all down with actionable steps can take a huge load off your mind and make that mountain ahead seem a lot easier to climb 

To help you in your journey, we’ve outlined below in seven easy steps how you can create a business plan for a medical staffing agency.

1. Outline Your Business Goals and Purpose

Start by writing out in clear terms what your business goals are for starting a healthcare staffing agency.

It should be concise and easy to understand. Furthemore, If you’re going to be applying for a business loan, this is your chance to lay out why you’ll need the funds and what your growth targets are. 

2. Decide on the Type of Business You’ll Be Running

Every staffing agency must decide on the type of ownership structure it will operate under. You have a few options, and each have their own pros and cons. Take some time to decide which one might work best for you depending on your personal and business goals. 

• Sole Proprietorship – This is where one person owns the entire business under their own name. Any debts or liabilities that the business takes on are the sole personal responsibility of the owner.
• Joint Partnership – When two or more people open a business together, they enter into a partnership. Depending on the arrangement, each owner may hold an equal or different share in the business. All debts and liabilities are still considered personal. 
• A Limited Liability Company – An LLC comes with significant tax benefits and can be opened under sole proprietorship or joint partnership. Another benefit to this arrangement is that it offers the legal protection of being a corporation. 
• A Corporation – Functions much the same as an LLC, with the important difference that it is owned by its shareholders, whereas an LLC is owned by one or more individuals. 

Whatever type of business you decide on, keeping track of employee time and attendance will make your life a whole lot easier. Learn more about our staffing agency software here . 

3. Ensure Liability Protection

As a nurse staffing agency, you’re in a rather unique position regarding legal protection. Your staff will be working in several different locations, some safer than others and you need to ensure that both they and you have proper protection.

Outline the type of liability insurance you’ll need and how it will protect your company from any damages caused. Since you’re operating in the medical industry, it’s advisable that you go with premium liability insurance. 

You’ll also need proper worker’s compensation in case one of your employees suffers an injury on the job. Your insurance program should cover both medical costs and rehabilitation. As an added bonus, it may also be worth getting short or long-term disability insurance on top of the base package. 

4. Investigate Funding Options

Whatever agency you operate within, when you first get started, you’ll likely be operating out of a spare room.

Furthermore, for the first few months, as you try to hire staff and find clients, your business will probably be in the red, financially speaking.

This is perfectly normal. That being said, eventually you’re going to have to find extra funding before your business can really take off. Employees will have to be paid before you even have clients and you’ll have advertising, recruiting, and operating costs to cover. 

To get yourself through these first early months, outline a plan for how you will fund your business venture. Some of it can come from your own personal savings, but in all likelihood, you’re going to need a business loan to cover the rest. Research what loan options are available and what the requirements are to be approved.

5. Make Revenue Projections

Key to the success of any business venture is an accurate revenue projection. This will be crucial when it comes time to apply for a business loan, so lay out your expected earnings for each month and yearly quarter for the first 2-3 years. It should be properly cited with market reports and financial statements to back up your projections. Be aggressive in your goals, but also realistic. Your loan officer will want to see clear evidence that you can cover your monthly loan payments and any other debts or liabilities you may have taken on.

This is also a good time to think about how you can achieve critical mass, the point at which you have enough staff and clients that your business becomes self-sustaining. When you first get started, you’ll be operating on a shoestring budget and largely dependent on whatever funding you could get.

Try to get a clear sense of how much you’ll need to grow before you can compete in the medical market effectively and remain competitive. Your point of critical mass will be an ever-changing target, so be aware that you’ll need to revise it over time. The revenue projections you make will have a direct impact on the balance between your medical staffing agency’s bill rate vs pay rate .

Revenue projections and medical staffing analysis is made easier by using our staffing agency software . Learn more here. 

6. Develop a Marketing Plan

This is where you will lay out your marketing plans and how you intend to achieve them. You’ll need to outline two marketing plans, one for attracting medical employees and another for clients.

For your medical employees, brainstorm a bunch of ideas for how you can draw talent. For instance, reach out to local schools that specialize in nursing and medical care. You could even try teaming up with a local faculty to encourage new graduates to join your agency. Other methods for finding staff include reaching out on social media or asking medical staff you already have on the books to reach out through their connections and pitch job offers.

As for clients, draw up a list of all the nearby hospitals, health clinics, and anywhere else that needs medical staff. These will be the targets for your marketing campaign, and you should have a clear idea for how you can attract their business.

If you have a unique selling proposition (USP), this is your chance to showcase it and explain how you will compete with other staffing agencies. You should also research any educational events in your area. Medical personnel are always in need of continuing education credits to maintain their professional licenses, and these events can be a great place to find both new recruits and new business clients.

7. Bring It All Together

Type out everything in a single document with each area categorized and properly indexed. It should be easy to present to lenders and provide a clear blueprint for how your business will operate and grow in the future. A basic business plan should include the following:

• An executive summary
• Company ownership structure and financing
• Market analysis and business plan
• Pricing model and marketing plan
• An appendix section listing supporting information

Bottom Line

There you have it! While there is no blueprint for how to open a healthcare staffing agency, if you follow these 7 steps your chance of success will drastically increase. 

Once you’re up and running, make sure you finalize your temp agency markup rates to ensure you’re profitable but don’t price yourself out of the market.

Furthermore, to offer unique value and attract the best medical professionals, invest in staffing agency software in order to streamline your time and attendance, payroll and HR.

Want to learn more about how Timerack can benefit your medical staffing agency? Book a personalized demo here . 

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Monthly Expenses for an Assisted Living Center

Written by Dave Lavinsky

Operating an assisted living center involves managing various expenses to ensure high-quality care and a comfortable living environment for residents. Developing a comprehensive assisted living facility business plan helps in categorizing and managing these costs, which include staffing, facility, food and supplies, marketing and administrative, and regulatory compliance expenses.

Understanding and controlling these costs is crucial for maintaining profitability and providing excellent services. This article provides a detailed breakdown of the typical monthly expenses for an assisted living center, offering insights into effective financial management strategies.

Download our Ultimate Assisted Living Business Plan Template here >

Starting an assisted living facility involves understanding and managing various monthly expenses to ensure sustainability and quality care for residents.

Staffing Costs

Staffing is the most significant expense for an assisted living center and thus, greatly affects your assisted living center’s profit margins . These costs typically accounting for 40% to 60% of total operating costs. Key staff roles include caregivers, nurses, administrative staff, housekeeping, and maintenance personnel.

• Caregivers: Caregivers provide direct assistance to residents with activities of daily living (ADLs) such as bathing, dressing, and medication management. They often work in shifts to ensure 24/7 coverage. Example Monthly Cost: 20 full-time caregivers at $2,500 each: $50,000
• Nurses: Nurses provide medical oversight and handle residents’ health care needs. Licensed Practical Nurses (LPNs) and Registered Nurses (RNs) are commonly employed. Example Monthly Cost: 5 full-time nurses at $4,000 each: $20,000
• Administrative Staff: Administrative staff manage the day-to-day operations, including admissions, billing, human resources, and compliance with regulations. Example Monthly Cost: 3 full-time administrators at $3,500 each: $10,500
• Housekeeping and Maintenance: Housekeeping staff ensure the facility is clean and well-maintained, while maintenance staff address repairs and general upkeep. Example Monthly Cost: 5 full-time housekeeping and maintenance staff at $2,800 each: $14,000
• Food Service Staff: Food service staff prepare and serve meals to residents, catering to various dietary needs and preferences. Example Monthly Cost: 5 full-time food service staff at $2,800 each: $14,000

  Total Monthly Staffing Costs: $108,500  

Facility Costs

Facility costs include expenses related to the physical building and infrastructure. These costs can vary significantly based on the location, size, and age of the facility.

• Rent or Mortgage Payments: Monthly payments for the property or lease, which can vary widely based on the location and market conditions. Example Monthly Cost: Rent or mortgage: $40,000
• Utilities: Costs for electricity, water, gas, heating, and cooling. Energy-efficient upgrades can help reduce these expenses. Example Monthly Cost: Utilities: $10,000
• Insurance: Comprehensive insurance coverage, including liability, property, and workers’ compensation. Example Monthly Cost: Insurance: $5,000
• Maintenance and Repairs: Regular maintenance and repairs are essential to keep the facility in good condition and ensure safety. Example Monthly Cost: Maintenance and repairs: $5,000

  Total Monthly Facility Costs: $60,000  

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Food and supplies.

Providing meals and daily living supplies is a substantial expense. This category includes food, kitchen supplies, cleaning products, and medical supplies.

• Food: The cost of food varies based on the number of residents and their dietary requirements. Providing nutritious, varied meals is essential for resident satisfaction and health. Example Monthly Cost: Food: $20,000
• Kitchen Supplies: Items such as utensils, cookware, and other kitchen essentials. Example Monthly Cost: Kitchen supplies: $2,000
• Cleaning Products: Necessary for maintaining hygiene and cleanliness throughout the facility. Example Monthly Cost: Cleaning products: $2,000
• Medical Supplies: Includes medication, first aid supplies, and other health-related items. Example Monthly Cost: Medical supplies: $3,000

  Total Monthly Food and Supplies Costs: $27,000  

Marketing and Administrative Costs

Ongoing marketing efforts are necessary to attract new residents, while administrative costs cover various operational expenses.

• Marketing: Efforts include digital marketing, community outreach, and traditional advertising to maintain high occupancy rates. Example Monthly Cost: Marketing: $5,000
• Office Supplies: Essential items such as paper, printers, and other office equipment. Example Monthly Cost: Office supplies: $1,000
• Technology: Costs for software, hardware, and IT support to manage operations efficiently. Example Monthly Cost: Technology: $2,000
• Legal and Professional Fees: Legal services, accounting, and other professional fees. Example Monthly Cost: Legal and professional fees: $3,000

  Total Monthly Marketing and Administrative Costs: $11,000  

Regulatory Compliance

Assisted living centers must comply with various state and federal regulations, which involve costs for licensing, inspections, staff training, and maintaining health and safety standards.

• Licensing and Inspections: Regular fees for maintaining licenses and undergoing inspections to ensure compliance with regulatory standards. Example Monthly Cost: Licensing and inspections: $1,000
• Staff Training: Ongoing training to ensure staff are up-to-date with the latest care practices and regulatory requirements. Example Monthly Cost: Staff training: $2,000

  Total Monthly Regulatory Compliance Costs: $3,000  

Total Monthly Expenses

Adding up all these costs gives us a comprehensive view of the total monthly expenses for an assisted living center.

Total Monthly Staffing Costs: $108,500

Total Monthly Facility Costs: $60,000

Total Monthly Food and Supplies Costs: $27,000

Total Monthly Marketing and Administrative Costs: $11,000

Total Monthly Regulatory Compliance Costs: $3,000

Total Monthly Expenses: $209,500

These costs reflect an average sized assisted living center. Costs will be higher for a larger facility and less for a smaller one.

In addition to the startup costs required to open an assisted living facility , running an assisted living center involves significant monthly expenses, from staffing and facility costs to food, supplies, marketing, administrative, and regulatory compliance costs. Understanding these expenses is crucial for effective financial management and ensuring the sustainability and profitability of the assisted living facility . By carefully managing these costs and optimizing operations, assisted living centers can provide high-quality care to their residents while maintaining financial health.

Assisted Living Facility Business Plan PDF

Download our assisted living facility business plan pdf here. This is a free assisted living business plan example to help you get started on your own assisted living business plan.

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• Chat with NCPA

This workshop is a MUST for owners

NCPA June 4, 2024

Are you on the right track? How will the DIR hangover cash crunch affect my business in six months or a year? Having trouble staffing up? The NCPA Innovation Center’s Pharmacy Ownership Workshop (June 22-23 in New Orleans) has the answer. Come to New Orleans in June and grab a chance to learn about—and implement—a business plan that will support your enterprise. Sponsored by McKesson and, in part, by First Financial Bank and Pharmacists Mutual Companies, this workshop is ideally suited to new owners and prospective owners at any point on their respective paths, whether you are looking for the right business plan or to hone your management skills. Best of all, it covers what you need to know for the entire arc of ownership, not just today or tomorrow. Get in it for the long run and register now .

NCPA informs FTC, DOJ, HHS on the dangers of PBM consolidation in health care markets

Ncpa calls on the california board of pharmacy to reduce the burden on compounders in proposed regulations, special podcast episode puts you on the front lines of what is happening on capitol hill, “finish the fight” and engaging your patients to join the fight.