Employment By Third Party: Cents And Sense

31 May 2016
 Categories: Construction & Contractors, Blog


Supervising warehouse operations can be cumbersome enough without the owner having to worry about the human resource side of things. This article provides two financial reasons why it might be a good idea to trust a third party recruitment agency with the task of hiring warehouse employees.

Lower Opportunity Costs

The warehouse storage business does have its surprises from time to time. It is not uncommon for a warehouse to fail to receive a shipment or two (from their regular clients) for extended periods.

During such times, warehouse owners are forced to downsize their staff so as to remain profitable. When the shipments start rolling in again, the need for additional staff arises so as to maximize the profit potential of the warehouse.

Conducting personal interviews each time there's a need for additional staff can be expensive (in terms of the opportunity costs involved). Hiring the services of a recruitment agency essentially transfers the opportunity costs involved to this agency. Many times, warehouse owners will have spent less to get each additional employee who ends up being hired from an agency.

There's also the advantage that using a recruitment agency allows a warehouse owner to hire additional staff on short notice. In contrast, warehouse owners who hire staff on their own need to advertise the vacant positions and to conduct personal interviews before employees are finally hired.

Lower Operational Costs

Operational costs in a warehouse often include the cost of equipment maintenance and/or repair, the cost of wages or salaries for warehouse employees and the cost of maintenance and/or repairs to office premises within the warehouse.

Out of the mentioned operational expenses, there's often little that a warehouse owner can do to reduce the cost of equipment maintenance.

Warehouse employees provided by a recruitment agency are often employed on a temporary basis. As such, warehouse owners get to avoid a number of expenses associated with full-time employment. Examples of these expenses include the cost of paying benefits and bonuses that full-time employees are often entitled to. This can help to bring down the cost of paying warehouse employees for their work as an operational expense.

By outsourcing the human resource function to a third party agency, warehouse owners reduce (or eliminate) the need for office premises within the warehouse facility. As such, the cost of maintenance and/or repairs to such premises will also be reduced. For more information, visit sites like http://www.contractlaboursydney.com.au.