The Secret to Happiness in Freight Forwarding
YES PAPA, THERE IS A FREIGHT'O CLAUS
It’s no secret that the freight forwarding industry is complicated logistically. Customers expect that their shipments will be delivered worldwide as fast as possible and at the lowest price. They demand the best service. They interface with the sales staff of the freight forwarder, and the operations staff puts together the details. When everything goes smoothly, everyone is happy.
Things are more likely to go smoothly with the right people. Good salespeople increase business and revenues. With bad sales people, the freight forwarder ends up bleeding money on salaries for these deadweights. Likewise, good operations staff get the job done efficiently. With bad operations staffing, problems tend to crop up—impacting morale, causing stress, and ultimately leading to lost customers.
Reputation is everything, and the wrong person in a key position—sales or operations—can have a negative impact on the freight forwarder’s reputation, not to mention the bottom line. It’s a lot harder to regain a lost customer. Sometimes it may even be impossible. Better not to lose that customer in the first place!
So how can a company ensure that they recruit the best talent for the job? The people that will bring in new business and keep their regular customers coming back for more?
One way is to use a dedicated Human Resource manager solely for recruitment. This person costs $50,000 per year in salary. It’s the way business has been done for years.
Not anymore. The modern way is to use a dedicated recruiter—a headhunter—to find the right person for a job. Recruiters work on commission, and typically charge twenty percent of the first year’s salary as their finder’s fee. They may sound expensive, but they save money in the long run.
Let’s run the numbers. For someone in sales, who typically makes $75,000 per year, that fee will be $15,000. For operations staff, with an annual base salary of $50,000, the fee would be $10,000.
Do the math. With a recruiter, it’s possible to hire between three and five people each year for the cost of keeping a dedicated Human Resource Manager. Moreover, a good recruiter has the contacts to do a much wider search for potential hires, throwing out a wider net to source the best talent in the field. They know who is looking for a change, and another freight forwarding company’s loss can be a gain if that key person can be persuaded to make a move. A Human Resource Manager will not be aware of who is looking, and can only rely on resumes.
Here’s another consideration. With sales staff, everyone knows that it’s a bit of a numbers game. Experience in the industry tells that only one out of two or three people will work out, becoming high producers and lead generators. The others will fail, and cost the company money. The trick is to identify those people quickly enough, but also give them enough time to settle in and produce.
What if there were a way to guarantee that the sales person will work out? There is, and it involves using a recruiter with a guarantee. Darius & Company specializes in recruiting for these key positions in the freight forwarding industry: sales and operations. Chief Executive Officer Darius Panah and his team make a promise about each and every sales representative they place. That promise is simple: There is no fee until the salesperson is performing. They know it may take a few months, even up to five, for that person to get up to speed. If it does take time, no payment is due until that sales person is a proven producer. Darius & Company want their clients to be one-hundred percent satisfied before they charge anything, and if that means waiting for their fee, they will wait. They would rather have happy clients because they know that happy clients become repeat clients.
A good salesperson will impact the bottom line positively, generating $200,000 and up in increased revenue and profits. So $15,000 spent on recruitment, and $18,000 in salary for five months is an investment that makes sense. It’s also the secret to happiness in the freight forwarding business.
Usually, it’s easier to recruit the right person for operations—the person who has just the experience needed, who can fill the specialized niche. Again, using a headhunter makes sense, both cost-wise and in efficiency. A good recruiter can select the best candidate, knowing who has the potential to be a good team player, who will likely fit the client’s culture, and ultimately be worthy of joining the team. Finding the right mix of people is crucial in this fast-paced field. Let Darius & Company do the recruiting and rest easy. They know that successful freight forwarding companies use recruiters to keep hiring and firing until they have found just the right mix of people in sales and operations. When their clients weigh the expense of a recruiter versus the expense of not having the right person to fill an open position, they realize it’s the smart way to hire—the way that makes money, instead of losing it.
Making an investment in good people is the key to growth and success, as well as the secret to happiness.
Hint: You play cards with them. (people)