ASS2# Step3

Three services of Hays

1.       Recruit, engage and retain people

2.       Provide industry training

3.       Provide leadership program

Recruiting company usually get paid for placing a qualified candidate into a client's organization for a specific vacancy. They do not find people jobs. 
The most common fee structure is take some percentages of the annual remuneration of the placed candidate, payable when the candidate has signed his/her contract or starts working. 
So for example say you are getting $10 an hour you’re probably actually getting $18 pound and hour but the agency is taking the $8. Some charge you a fee if you find employment through them. Some charge the company through getting an employee for them for advertising their company

Contribution Margin (CM) = Sales (S) – Variable Costs (VC)

Contribution Margins are the difference between what a products cost (variable and fixed costs) for the cost of the services.

Services	Recruit, engage and retain people	Provide industry training	Provide leadership program
Selling price	$200 per person -5 hours /day	$800 per person -5day course	$920 per person -5 day course
Variable costs	$120	$550	$580
Contribution margin	$80	$250	$340

Traditionally sales people have been remunerated on a combination of base salary and sales commissions calculated as a percentage of their sales. This is a fixed and variable component model and it makes “break-even point” the most important item to manage.

Variable costs on the other hand, fluctuate with activity. As activity rises, so do variable costs — things like advertisements, commissions, and travel costs tend to be variable.

Managing the ratio between fixed and variable costs is one of the few opportunities a recruiting manager has to demonstrate business acumen. This cost structure lends a number of advantages and becomes even more important when demand cycles are unpredictable.

Why not only produce the product or service with the highest contribution margin?

Firm may have all different contribution margin in each product. As long as it has a positive contribution margin, they make profits and they can sell it for more than it cost to produce it.

So it is better to producing than not producing at all.

Some of constrains that my company might face are:

1.       Reputation of the company- the reputation influences recruitment process and people are most interested in applying in a good reputation company

2.       Organisational Policies – people may not happy with company’s policy that they are applying for.

3.       Unattractive Jobs – if job has lack of opportunities for promotion or not good salaries and working condition may affect to recruitment process.

4.       Training costs- Although providing training is an essential benefit to both business and the employee as employee training programs ensure that all workers have the skills, knowledge and experience to perform job tasks safely, it is costly to provide to the all employees and workers.

5.       It is necessary to introduce a new technology in order to improve their competitive and it cost a lot.