Expanding your business during uncertainty: Insights from industry leaders
Despite the current uncertainty facing the market, leaders in the staffing industry are optimistic. Even as economic concerns entered the picture, in this year’s GRID Industry Trends Report, over 2,000 recruitment professionals predicted growth in the year to come. Part of this growth stems from expanding into new business models, service offerings, and verticals.
Though expanding your business can mean tapping into new revenue streams, knowing when to diversify, and which markets are worth pursuing, determining the roles your people, culture, and tech stack play in your firm’s growth can be challenging.
At Engage Boston 2023, Jeff Neumann, VP of Product Marketing, Global Enterprise and Salesforce at Bullhorn, sat down with Bill Peppler, COO of Kavaliro, and John Gulnac, CEO of NSC Technologies, to talk about their experiences in expanding their businesses. Check out our recap below to learn how they successfully diversified – and how you can do the same, even during times of uncertainty.
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Opportunities for growth amid uncertainty
Economic factors are constantly ebbing and flowing, and the staffing industry is often along for the ride. “The growth we saw in 2021 and 2022 was abnormal,” said Peppler. “I don’t think you can set expectations of what it was like the previous two years.” While current growth may not reach last year’s numbers, there are still ways to succeed.
Instead of only looking at your top-line revenue, consider other definitions of growth throughout your organization. For example, Kavaliro’s gross profit and bill rate growth exceeded those of previous years, indicating continued success even amidst stiffer economic challenges.
A slowdown also offers a chance to pursue organizational growth, like a maturation in sales or internal hiring processes, training improvements, or new automation advancements. While these adjustments may take time to pay off in your top line, re-positioning your organization from an infrastructure, people, and culture perspective can set you up for success years down the line. “We have the uncertainty in the market to look a little bit more inward,” said Gulnac.
New service and business models
Firms can also pursue growth by expanding their business across multiple sectors. The current market is sector-driven, said Gulnac, and focusing on specific markets can help your firm capture their growth potential. “Like any other investment strategy, you’ve got to diversify your portfolio,” he added.
Peppler highlighted a few examples from his own work. Kavaliro began as a traditional staffing firm; they’ve moved into several new areas in the last few years, including branching out into a government services practice and working as a Salesforce integrator. He added that the rise of the statement of work business has also been lucrative for his organization and clients. “You need skilled marketing and salespeople to go after those new opportunities,” he noted.
As for NSC, their niche industrial market required that they invest in building and training a specialized workforce. “We wouldn’t have done that without the relationship, inside knowledge, and financial commitment from a customer,” Gulnac added.
When expanding into a new market or service model, Gulnac advised firms to take the long view. “Ask yourself, ‘Is my customer base something that can support that demand over time? Or am I just reacting to a bubble?’” Though a certain amount of risk is always present, building a sustainable customer base is essential when moving into new spaces.
Ultimately, service model popularities can change over time, so both panelists spoke about the importance of being flexible and open to new ideas. Gulnac touched on the concept of failing fast and quickly moving through a volume of ideas rather than fixating on just one or two. If a new opportunity competes with an existing component of your business, it may not be worth pursuing.
“I think you have to look at why you’re going into that product line,” Gulnac said. “Are you doing it to offer utility so you don’t lose a customer? Or are you looking to go in because you want to be a space disruptor? Those that are disruptions can wait a little bit on the ROI, whereas we make the short-term investments to protect that foundational or anchor account.”
Aligning tech with business strategy
When it comes to integrating your technology goals with your business initiatives, both panelists agreed that your business strategy needs to be your guide, with your tech stack helping you get where you want to go. “Which customer segment do you want to win? Which customer segment do you want to serve? And that’s got to be your North Star,” Gulnac said.
Peppler added that his organization’s tech needs evolved as their business did. “We needed a full-fledged software system as our business evolved with multiple lines of business, with different revenue streams,” added Peppler. He noted that as Kavaliro diversified their offerings, their back office changed completely to keep up. “Our systems did need to change from what we were to who we became,” Peppler added.
Ultimately, there’s no right or wrong segment to pursue, especially given the frequent shifts in the market. As long as your team is agile, you have the tech tools to support them, and you have flexibility built into your operating model, Gulnac said, “That’s when you find your sales team and your recruiting team organically solving customer issues and coming to you with new opportunities.”
“You have to support those fast-driving models,” added Peppler. “But you also can’t forget the legacy business that’s built us to who we are today.”
To learn more about expanding your business and succeeding during uncertainty, check out our new eBook, featuring insights from more industry leaders.