SIA Europe Panel Takeaways
Our GM Jeremy Bilsky recently traveled to London to speak on the panel “Raising Financial Capital in Good Times and Bad”. Here are some of the key takeaways:
How are you feeling, in general, about the U.S. economy?
While there is still much uncertainty surrounding the economy – and an upcoming election year to boot – this is a time of opportunity for staffing firms.
The group was optimistic based on economic indicators – including job and wage data, inflation rates, consumer spending, and more – that we’ve outrun the expectation of yet another recession and we’re headed for a time of growth.
How do you view the state of lending/factoring specifically, in the U.S.?
According to the Federal Reserve Banks’ Small Business Credit Survey, only 42% of small businesses report having their financing needs met.
Over the past few years of economic uncertainty, businesses have had to get more creative than ever in securing the necessary funds to maintain operations, pay employees, secure necessary supplies and grow their businesses. There are options beyond traditional bank loans for businesses to leverage – and for staffing firms in particular knowing that you have access to the capital you need to scale and grow is critical.
How would you say your staffing clients are faring at the moment?
Staffing firms have not been immune to the market correction coming out of the pandemic. It depends a lot on industry. For example, job growth in the leisure and hospitality sector is stabilizing coming out of its post-pandemic surge. Projected healthcare industry revenue this year is three times the pre-pandemic level.
While industry growth is expected to slow to 2% in 2023, we anticipate that there will be an acceleration in the second half of next year across industries.
Staffing firms need to be ready for this shift. We’re urging our clients to strike a balance between being lean now but ready to scale quickly when opportunities arise. We urge them to invest now for the future.
What are some of the key elements staffing firms should have in place before pursuing growth opportunities?
They need to make a plan for capital as part of their growth strategy.
Capital can help fund a company’s ability to expand into new geographies, take on larger projects, launch a new service line, explore acquisitions, invest in technology and marketing and so on.
They also need a clear understanding of their strengths and how to use those as a competitive advantage. We advise, don’t overextend yourself – the quickest way to lose is to try and be something for everyone.
It’s important to have the right people in the right roles. In a highly competitive industry, people and culture are what set you apart.