Professional Services
Business Funding for Staffing Agencies
Staffing agencies pay their workers every week but do not get paid by clients for 30 to 60 days. That gap is the defining financial challenge of the industry. Every new placement widens the gap because you are adding payroll obligations without immediate revenue. The faster you grow, the more cash you burn, which is why staffing agencies are the heaviest users of invoice factoring of any industry.
Common Uses
What Staffing Agencies Use Funding For
- Fund weekly payroll for temporary and contract workers placed at client sites
- Cover workers' compensation insurance premiums and employer payroll taxes
- Invest in applicant tracking systems and recruitment marketing platforms
- Open branch offices in new markets to serve additional client territories
Funding Options
Best Funding Types for Staffing Agencies
Payroll Factoring
The standard funding tool for staffing agencies. Factor your client invoices and use the advance to make weekly payroll. Staffing-specific factors like Advance Partners and Encore Funding understand the industry and can scale with your growth.
Asset-Based Lending
Borrow against your accounts receivable on a revolving basis. ABL facilities are structured for the high-volume, repetitive invoicing pattern of staffing companies and can provide larger credit limits than traditional factoring.
Working Capital Line of Credit
Supplement factoring with a credit line for operational expenses like recruiting, background checks, and office overhead. Use the credit line for non-payroll expenses so your factoring facility covers the big-ticket item.
What Lenders Look For
Qualification Notes for Staffing Agencies
Related Industries
Related Professional Services Funding
By Location
Staffing Agencies Funding by City
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