How To Choose the Best Staffing Agency for Your Needs

Not all staffing agencies are created equal—find one that understands your company.

Finding and hiring qualified, skilled employees is a big challenge facing small to midsize business owners today. With limited resources compared to large corporations, SMBs need to find recruiting solutions that provide access to top talent without blowing the budget. This is where partnering with the right staffing agency can really make a difference.

But how do you know which staffing agency is right for your business? Not all staffing agencies are created equal, and you need to find one that understands your industry, your needs, and your goals. Whether your business is looking to fill roles in sales, engineering, IT, or other departments, the tips we provide here will help you find an agency that understands your niche, finds quality candidates, and sets your team up for success.

What does a staffing agency do?

A staffing agency, also known as a recruiting agency or talent acquisition firm, is a business that helps companies find, screen, and hire qualified candidates to fill open positions. Staffing agencies maintain large databases of pre-screened and qualified workers and use their resources and expertise to match these candidates to jobs at client companies.

The benefits that a staffing agency can provide to SMBs include:

• Access to a vast talent pool: With their extensive network of pre-screened candidates, staffing agencies can provide SMBs with access to a wider range of talent than they could find on their own.

• Reduced time and resource commitment: Recruiting can be a time-consuming and resource-intensive process. Staffing agencies handle the entire recruitment process, freeing up business owners and managers to focus on their core business operations.

• Talent matching expertise: Staffing agencies possess specialized expertise in matching candidate skills and experience to specific job requirements, making sure that businesses hire the right people for the right roles.

• Cost-effectiveness: While there are some upfront fees associated with using a staffing agency, the long-term cost savings can be significant, as businesses avoid the expenses of in-house recruitment efforts and potential hiring mistakes.

How to define your needs for hiring a staffing agency

It's important to have a clear understanding of your business's hiring needs before you reach out to potential staffing agencies. Defining your needs upfront will allow you to effectively communicate details to agencies during the vetting process so they can customize their approach and ensure you find the right fit. Here are some initial steps you should take.

Outline the types of employees you need

The first step in defining your staffing needs is identifying the specific types of employees you require. Here are some factors to consider:

• Assignment duration: Do you need temporary, contract-to-hire, or permanent employees? Temporary employees are hired for a specific period of time or project, contract-to-hire employees are hired with the possibility of becoming permanent, and permanent employees will be hired directly.

• Skill level and qualifications: Consider the technical skills, industry knowledge, certifications, and educational background that are essential for successful job performance.

• Specializations: Depending on your industry and business needs, you may require candidates with specialized knowledge in areas such as technology, finance, marketing, healthcare, or engineering.

• Culture fit: Define the values, work culture, and team dynamics that are important to your business so the staffing agency can find candidates who not only possess the necessary skills but also align with your company's values.

Define department focus

In addition to outlining specific job roles, define what departments have the most urgent hiring needs. Gartner's "4 Steps to Find the Right Agency" mentions that including department leaders in the process will help to ensure you get well-suited candidates.^[1] 

Defining the department focus will also help potential staffing agencies understand the context of your staffing needs.

Here are some questions to ask when defining your department focus:

Which departments are experiencing staffing shortages or require additional support?

What are the unique needs and challenges of each department?

What kind of work culture exists in each department?

Are there any specific departmental initiatives or projects that require additional staffing?

Determine your budget

Establishing a clear budget for hiring a staffing agency is important for ensuring that you allocate resources effectively. Consider the following factors when determining your staffing agency budget:

• Agency fees: Staffing agencies typically charge fees based on a percentage of the salaries of the candidates they place. Research average agency fees in your industry and region to get a ballpark estimate of the costs involved.

• Position salaries: Determine the salary ranges for the open positions you need to fill. This will help you assess the overall cost of hiring through a staffing agency.

• Contract duration: Consider the length of time you expect to need the services of the staffing agency. Longer contracts may involve lower fees, while shorter contracts may require higher upfront costs.

• Additional expenses: Factor in any additional expenses associated with hiring through a staffing agency, such as background checks or onboarding fees.

Factors to consider when choosing a staffing agency

Once you've clearly defined your hiring needs, the next step is evaluating potential staffing agencies to find the right partner. Not all staffing firms are created equal, so it's important to assess key factors that indicate an agency's expertise and track record of success. Focus on the following areas:

Experience in your industry

You can save a lot of time if you choose a staffing agency that has already worked with businesses in your industry. Their past experience filling similar roles will help them better understand your needs and source great candidates.

Here are some questions you can ask to determine their experience in your industry:

• How long have you been staffing for your industry?

• What are some of the clients or projects you've worked on in the industry?

• Do you have relationships with industry-specific talent pools, associations, or networks to find candidates?

• Do you have candidates already screened for these types of openings, and can we see examples?

Talent sourcing process

The talent sourcing process used by a staffing agency will determine the quality, relevance, and speed at which they can find candidates for your business. Understanding and evaluating this process is essential in selecting an agency that can efficiently meet your hiring needs.

Have potential staffing partners answer these questions:

• What platforms and resources do you use to source talent?

• How do you market and promote your clients and their opportunities to candidates?

• What geographical regions do you source talent from? Local, regional, national?

• How large is your existing candidate database, and how many new candidates do you add each month?

• How do you assess and match candidates' skills, qualifications, and interests with your clients' needs and expectations?

Candidate screening process

Once a staffing agency has a list of potential candidates to fill positions in your company, they will evaluate them before presenting them to you. A staffing agency with a rigorous and thorough candidate screening process can provide you with more reliable and qualified candidates and reduce the time and effort you spend on interviewing them.

To examine the candidate screening process of a staffing agency, you can ask them the following questions:

• What methods do you use to screen and test candidates?

• What process do you use to validate the candidates' references, background, and credentials?

• How selective are you? What percent of candidates make it through the screening process?

• How do you communicate and follow up with the candidates during screening?

• When do you involve clients in the screening process?

References or case studies

When evaluating potential staffing agencies, request references from current or past clients. This will give you valuable insights into the agency's work ethic, client satisfaction, and overall reputation. Also, inquire about case studies or success stories that demonstrate the agency's ability to place qualified candidates in challenging roles.

When checking references, ask an agency’s past clients these questions:

• How satisfied were you with the agency's services?

• Did the agency meet your hiring needs and expectations?

• Were the candidates presented to you qualified and suitable for the open positions?

• Was the agency responsive and communicative throughout the hiring process?

• Would you recommend this agency to other businesses?

How they handle employee issues

Employee issues can range from minor performance concerns to more serious disciplinary matters. A reputable staffing agency will have clear policies and procedures in place to address these issues effectively and professionally.

To discover how a staffing agency handles issues with employees, ask these questions:

• How do you train and orient employees before placing them in their roles?

• How do you monitor and evaluate employees' performance and feedback?

• Will you replace candidates who leave or are let go within a certain timeframe? What are the policies around this?

• How do you handle and address any complaints, grievances, or disputes that the employees may have?

• Can you provide counseling or mediation if conflicts arise?

Average time to source talent

This is an important point to consider because one of the reasons you might use a staffing agency is to speed up time-to-hire. A staffing agency that is fast and efficient at sourcing talent can help you meet your deadlines and goals and reduce the costs and risks associated with having unfilled positions.

These questions will give you an idea of how long a staffing agency will take to fill your roles:

• How quickly can you start recruiting for our job openings?

• What is your average number of days to submit initial candidates?

• How much time do you typically need to fill roles like ours?

• Can you meet urgent needs or compressed timelines?

• How do you ensure the quality and suitability of the candidates that you source within the given timeframe?

Picking the perfect staffing agency partner

Finding skilled talent remains one of the biggest hurdles for SMB leaders to overcome, but partnering with the right staffing agency provides a solution to the recruiting and hiring challenges smaller companies face.

If you're considering partnering with a staffing agency, start by determining what your staffing needs are and creating a budget, remembering to include the various fees an agency may charge. Once you're done with that, create a shortlist of your top three or four choices. You can use our directory of staffing agencies to help create your list.

Then, use the questions outlined in this article to make your final choice.