What does it really cost to recruit an Owner Operator for your company? What is your net gain on a recruit for 1 year?
The truth is that there is a major disconnect between the CEO, CFO and Recruiting Director at most companies as to the real numbers. Ultimately, the CFO has the real numbers to work with.
According to the National Recruiting Director for an Atlanta ,Georgia based company, the national average advertising cost is 2,500.00 per recruit. His numbers came from a National Association survey.
In a survey performed by our company, the range was very broad. The lowest responses came from Recruiting Directors while the highest came from the CFO's. The drum roll please.....337.00 low to 5,600.00 high.
The total cost to recruit an O/O was low of 2,700.00 to a high of of just over 10,000.00 for total expenses. There is a common denominator in the process. The companies with the highest turnover rate generally have the highest cost of recruiting.
Is it worth the cost? You be the judge. My feeling is that if you have a turnover rate above 100%, the answer is no...
Why? Assume it cost your company 10,000 total cost to recruit an O/O on January 1 and that Truck Driving Owner Operator is still with you on Dec 31. Assume that driver generates 10,000 miles a month and the average per mile is 1.24. The average company should gross 15% for their part to pay all overhead including recruiting cost. Let's do the math. 120,000 miles times 1.20 per mile = $144,000.00 gross. $144,000 X 15% = 21,600.00
21,600- 10,000(high end recruiting cost) = 11,600 left to help pay all other operating cost. If the turnover rate is less than 100% it becomes a better proposition.
The questions now become , " How can we reduce this recruiting cost?",
" How bad do we really want to grow?" and " How do we reduce the turnover rate?"
One way to reduce recruiting cost is to explore non data base driven Internet specialist. By doing this, you can target market the right crowd as well as test your advertising message. By doing this, you can recruit the type of person that will stay with you longer. The process takes work, but is well worth the price.
Look for our test the message article coming soon.