So What Club

Staffing and outsourcing: temp work, recruitment, call centres and work platforms

One temp worker for one week, and what a 3 percent rate cut does

The prompt

BrightShift Staffing (a fictional agency in Texas) places a warehouse worker with a client for a 40-hour week. It bills USD 30 an hour and pays the worker USD 20.50 an hour. Employer taxes, insurance and benefits add 18 percent to pay. Recruiters, the branch, sales and systems cost about 16 percent of revenue. What are the agency's gross profit, gross margin and operating profit for the week? The client then asks for a 3 percent lower bill rate. What is left?

Before you reveal anything, plan your own structure and first move on paper. Then reveal one part at a time and compare.

Clarifying questions, with the interviewer's answers

Next case

Read the next worked case the same way: plan your own answer first, then reveal one part at a time.

Next case: A contact centre in Manila: billable hours, profit, and what 30 percent fewer calls doThe lesson: Staffing and outsourcing economics: the spread, billable hours and the cost of churn
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