There’s no question that the heartbeat of your organization is your team of contractors; they are the ones that meet the clients every day. Taking care of your contractors, then, is critical to the health of your business. But did you know your contractors are also the center of potential referrals? If your contractors are happy, clients and contractors alike will refer others to your company.
In this article, we’re going to take a look at ways to super-charge your referral base by the care and feeding of your contractors.
The team with front-line responsibility of caring for your contractors is, of course, your recruiting team. They often are the first impression your contractors have of your company and are there to hold their hands and walk them through the process of working for your company. As a matter of fact, recent statistics show that 78% of job seekers who had a bad experience during the recruiting process will share that information with friends and family. How much more valuable, then, is the positive word of mouth spread by contractors who have a great recruiting experience with your company? How your contractors start determines how they look at your company moving forward, and how likely they are to refer your company to other contractors and those needing your services.
There are three key ways to evaluate how well your recruiters are taking care of your contractors: length of contractor retention during a contract, length of contractor retention throughout their lifetime with the company (redeployment), and how many viable referrals come into the company through the contractor.
1. Contractor retention during an engagement
Are your contractors making it through the length of their engagements with an individual client? If not, the recruiting team should be held accountable. Their screening of the contractors prior to hiring is the first key to contractor success and retention. When a contractor leaves their engagement prior to the end of the contract, it could mean the engagement was not adequately explained, or the client changed the contract parameters; in either case, the solution lays in how well the recruiter worked with the contractor. A recent survey by Staffing Industry Analysts (SIA) found that 3% of contractors/temporary staff left before an engagement ended. Of that, half left because of miscommunication; imagine how those numbers could impact the number of referrals your contractors would give if they stay longer.
2. Contractor redeployment throughout multiple engagements
Do your contractors leave your company as soon as their engagements with a particular client are completed? How long do your contractors stay with your company – one engagement period or several? The longer your contractors stay with the company, the more likely their customers are to refer your company. Your contractors are also more likely to refer your company to those who could use your services, if they’re happy with the company and their treatment.
3. Viable referrals from the contractor.
As mentioned, contractors will stay longer and refer your company more often if they feel they’re treated well. However, are those referrals always viable? Not necessarily. The longer a contractor is with your company, the more they appreciate the value you’re providing to your customers, through the use of contractors. The end result? A viable referral, one where the likelihood of a new contractor signing on the dotted line is great, because their friend or colleague—the person who referred them—has already laid the groundwork.
As you can see, if your contractor-care specialists—your recruiters and account managers—are working closely with the contractors, your business will grow through contractor referrals.
We’ve talked about the correlation between the care of contractors leading to referrals, less turnover of contractors and longer contract rates, but what exactly is a contractor referral? At its basic level, it’s an opportunity for new business, generated by recommendations from your contractors. This type of referral is very different from asking existing clients to help you close a lead generated by your sales team. A contractor referral is based on personal relationships and connections your contractor has.
For most companies, adding a contractor referral program means adding a commission, payable to the contractors, for every viable lead. The resulting new business will pay for itself in just one or two contracts, as more contractor leads end up in more and more business, almost organically.
There are three main advantages to adding a contractor referral program that builds relationships and gains leads through your contractor base.
1. Higher close rate
Your contractors have first-hand experience with your company. They know their friends, colleagues, and clients more intimately than you do. The result is known as “better-matching mechanism,” which means that leads generated from a contractor for your company will organically have a higher close rate, because the leads are pre-qualified, leading to improved sales efforts.
2. Lower lead cost
Well-designed, contractor-driven referral programs reward both the contractor and the customer at a total cost that is less than your average cost-per-lead. The more new business through contractor referrals, the lower your cost-per-lead will be.
3. Higher adoption and retention
It’s common knowledge that referred customers are more loyal, in part due to the better-matching mechanism. It also is because referring contractors act as “virtual customer success managers” to friends they refer to the company as contractors, as well as to the businesses to whom they refer as potential clients.
We’ve spoken quite a bit about how contractor care can help your referral conversion rates, but what about the bottom line? How will taking care of your contractors—through both a contractor referral program and an overall contractor care program—build your bottom line?
In general terms, satisfied contractors will refer more business if asked to do so, but very few are actually asked, so keep your contractors satisfied, which includes ensuring they feel heard, feel appreciated and feel respected. If you’re using Sense, you can seamlessly add a Referral Workflow into your existing process, ensuring no contractor is ever missed and they’re always asked for a referral. By adding an “official” contractor referral program, where contractors share in the commission on any sales closed through their referral, not only are you asking your contractors to refer new customers, you’re showing them the appreciation is concrete.
Your contractors will thank you, your customers will thank you and your bottom line will thank you.
Interested in expanding the contractor care program at your firm? Schedule a demo of Sense to see how our software for staffing companies can help.