January 28, 2008
Sign of the times | With a fresh acquisition and new strategy, Maine Staffing Group takes on the Portland market
By Kerry Elson
Maine Staffing Group avoided Portland for 14 years. A group of five staffing agencies owned collectively by Rick Holden, Mark Burns and Barbara Mahoney, Maine Staffing Group has grown slowly from its Brunswick base to offices in Lewiston, Augusta, Biddeford and Bangor. But Portland, where there's a glut of staffing firms, seemed like a tough market to crack.
Portland also is Maine's population center, though. Without an office in the city, Maine Staffing Group was missing out on thousands of potential hires for its five companies, which mostly supply workers for construction and manufacturing jobs. As those workers became increasingly hard to find, Holden, Burns and Mahoney last year realized they needed to enter the Portland market. The decision was not without hesitation. "We had to sell ourselves on the idea," says Holden.
They figured the best way to enter the Portland market was to buy their way in. In December, one of Maine Staffing Group's member companies acquired the assets of Industaff, a division of Portland-based Springborn Staffing that provides temporary workers for manufacturers. (Holden says he and his partners paid "a fair price" for Industaff, but declined to discuss specifics.) The acquisition adds another 50-75 companies to Maine Staffing Group's client base, a 10% boost, according to Holden.
Along with the acquisition, Maine Staffing Group opened a Portland office to manage the Industaff accounts and act as home base for another company they started last year, Project Flagging Inc. That firm supplies flaggers ˆ the workers who hold the "stop/slow" signs ˆ for contractors doing road work. The positions are difficult to fill because the pay is typically low and the work isn't steady.
But Holden and his partners see those hard-to-fill jobs as an opportunity, and one they say will drive growth for Maine Staffing Group in 2008. Project Flagging contributed 10% of Maine Staffing Group's overall revenues in 2007. (Holden and Burns wouldn't discuss the company's revenue or other figures, including the number of temp employees it works with, because, Holden says, "there is a good level of competition" in the staffing industry.) The flagging operation last year also supplied workers for 15-20 projects, and Holden says he expects its revenue to triple by the end of 2008, in response to customer demand. "We have a backlog of [flagging] contracts," says Holden.
The hard part, though, will be finding people to take those jobs. Maine Staffing Group has experience hiring for hard-to-fill positions in construction and manufacturing, but good flaggers are especially hard to find, says Pete Coughlan, who offers flagging training for construction companies as director of the Maine Local Roads Center, a division of the state Department of Transportation.
"The nature of this business is that a lot of these [flagging] companies come and go, because of the quality of the person [who will take the flagging job]," Coughlan says. "You end up getting a lot of people that are simply looking for any job they can find ˆ I've even heard of companies that find people at homeless shelters to be flaggers."
Holden and Burns say Project Flagging will succeed because they pay their flaggers $9-$12 an hour, higher than the industry standard of $8 an hour. In Portland, Burns says, they'll also have more job candidates to choose from. But even though the flaggers go through the required training from the state and undergo a background check, their performance can be inconsistent. Project Flagging's first year was "an eye-opener," says Burns, because hires wouldn't always show up.
That instability is more familiar to Maine staffing firms these days, as skilled workers either leave the state or look beyond construction and manufacturing to more consistent employment. Holden, Burns and Mahoney have spent more time recruiting, but at times they have to keep people who are unreliable. "We give more second chances now," says Burns.
Staying flexible
Rick Holden and Mark Burns got into the staffing business in 1994. Their first step was acquiring Ames Personnel in Brunswick, and since adding Barbara Mahoney as a partner in 1995, they've either acquired existing agencies or started new ones, with revenues growing about 10% annually for the last eight to 10 years, according to Holden. Five years ago, they branded their firms as Maine Staffing Group. Today, Maine Staffing Group consists of five companies: Project Staffing Inc., Variable Employment Inc., Special Teams Inc., One Source Preferred Inc. and Project Flagging Inc. All the companies are jointly owned by Holden, Burns and Mahoney, and each company has a presence at the Maine Staffing Group offices in Portland, Bangor, Brunswick, Biddeford and Lewiston.
Maine Staffing Group's steady growth mirrors growth in the staffing industry overall. Firms started in the 1950s, according to Osborne, have expanded as more companies realized they could save money by paying someone else to hire and retain workers. Warren Mechanical, a HVAC firm in Westbrook, has employed 10%-20% of its workforce through Special Teams for the last two years. The arrangement trims yearly operating costs by 8%-10% because the company now spends less money on recruitment, according to Michael Leighton, vice president of the company.
Holden, Burns and Mahoney started Project Flagging in 2007, noticing that flaggers were in high demand at construction sites. "I think the trend over time has been to go to private flagging companies because it's easier to do and you can use your own people for the actual construction," says Pete Coughlan, of the Maine Local Roads Center.
Still, the flagging business is a small niche in Maine, partly because it's hard to find good flaggers. Coughlan estimates there are only six or so companies in the state offering such services, including A.B. Malley Inc. in Bangor and Maine Professional Road Services in Randolph.
Holding the "stop/slow" sign might seem easy, but flaggers are crucial for safety at job sites and are supposed to receive training, though not all do. Holden, Burns and Mahoney figured they can succeed where other companies have failed by paying flaggers more money. "These minimally paid positions can hold up $5 million in construction projects," Holden says. "We made a decision in getting into the business that we wanted to provide a better pay level to people who do flagging. The lower people get paid, the less likely they are to show up."
Maine Staffing Group's health and safety manager has instructed 100 flaggers over the last year, according to Burns. Last year, five of their flaggers were working at the Peter Dana Point project for Sargent Corp., a construction firm in Stillwater. The project is on hold until the weather warms up, says Doug Morrison, project manager at Sargent. "That's why we hire a temp agency ˆ because they're flexible," he says.
Finding people for the flagging positions won't be easy, though. That's one reason the three partners decided to open their Portland office. "We put a lot of effort into going to where people are instead of asking them to come to us," Holden says.
Portland also is Maine's population center, though. Without an office in the city, Maine Staffing Group was missing out on thousands of potential hires for its five companies, which mostly supply workers for construction and manufacturing jobs. As those workers became increasingly hard to find, Holden, Burns and Mahoney last year realized they needed to enter the Portland market. The decision was not without hesitation. "We had to sell ourselves on the idea," says Holden.
They figured the best way to enter the Portland market was to buy their way in. In December, one of Maine Staffing Group's member companies acquired the assets of Industaff, a division of Portland-based Springborn Staffing that provides temporary workers for manufacturers. (Holden says he and his partners paid "a fair price" for Industaff, but declined to discuss specifics.) The acquisition adds another 50-75 companies to Maine Staffing Group's client base, a 10% boost, according to Holden.
Along with the acquisition, Maine Staffing Group opened a Portland office to manage the Industaff accounts and act as home base for another company they started last year, Project Flagging Inc. That firm supplies flaggers ˆ the workers who hold the "stop/slow" signs ˆ for contractors doing road work. The positions are difficult to fill because the pay is typically low and the work isn't steady.
But Holden and his partners see those hard-to-fill jobs as an opportunity, and one they say will drive growth for Maine Staffing Group in 2008. Project Flagging contributed 10% of Maine Staffing Group's overall revenues in 2007. (Holden and Burns wouldn't discuss the company's revenue or other figures, including the number of temp employees it works with, because, Holden says, "there is a good level of competition" in the staffing industry.) The flagging operation last year also supplied workers for 15-20 projects, and Holden says he expects its revenue to triple by the end of 2008, in response to customer demand. "We have a backlog of [flagging] contracts," says Holden.
The hard part, though, will be finding people to take those jobs. Maine Staffing Group has experience hiring for hard-to-fill positions in construction and manufacturing, but good flaggers are especially hard to find, says Pete Coughlan, who offers flagging training for construction companies as director of the Maine Local Roads Center, a division of the state Department of Transportation.
"The nature of this business is that a lot of these [flagging] companies come and go, because of the quality of the person [who will take the flagging job]," Coughlan says. "You end up getting a lot of people that are simply looking for any job they can find ˆ I've even heard of companies that find people at homeless shelters to be flaggers."
Holden and Burns say Project Flagging will succeed because they pay their flaggers $9-$12 an hour, higher than the industry standard of $8 an hour. In Portland, Burns says, they'll also have more job candidates to choose from. But even though the flaggers go through the required training from the state and undergo a background check, their performance can be inconsistent. Project Flagging's first year was "an eye-opener," says Burns, because hires wouldn't always show up.
That instability is more familiar to Maine staffing firms these days, as skilled workers either leave the state or look beyond construction and manufacturing to more consistent employment. Holden, Burns and Mahoney have spent more time recruiting, but at times they have to keep people who are unreliable. "We give more second chances now," says Burns.
Staying flexible
Rick Holden and Mark Burns got into the staffing business in 1994. Their first step was acquiring Ames Personnel in Brunswick, and since adding Barbara Mahoney as a partner in 1995, they've either acquired existing agencies or started new ones, with revenues growing about 10% annually for the last eight to 10 years, according to Holden. Five years ago, they branded their firms as Maine Staffing Group. Today, Maine Staffing Group consists of five companies: Project Staffing Inc., Variable Employment Inc., Special Teams Inc., One Source Preferred Inc. and Project Flagging Inc. All the companies are jointly owned by Holden, Burns and Mahoney, and each company has a presence at the Maine Staffing Group offices in Portland, Bangor, Brunswick, Biddeford and Lewiston.
Maine Staffing Group's steady growth mirrors growth in the staffing industry overall. Firms started in the 1950s, according to Osborne, have expanded as more companies realized they could save money by paying someone else to hire and retain workers. Warren Mechanical, a HVAC firm in Westbrook, has employed 10%-20% of its workforce through Special Teams for the last two years. The arrangement trims yearly operating costs by 8%-10% because the company now spends less money on recruitment, according to Michael Leighton, vice president of the company.
Holden, Burns and Mahoney started Project Flagging in 2007, noticing that flaggers were in high demand at construction sites. "I think the trend over time has been to go to private flagging companies because it's easier to do and you can use your own people for the actual construction," says Pete Coughlan, of the Maine Local Roads Center.
Still, the flagging business is a small niche in Maine, partly because it's hard to find good flaggers. Coughlan estimates there are only six or so companies in the state offering such services, including A.B. Malley Inc. in Bangor and Maine Professional Road Services in Randolph.
Holding the "stop/slow" sign might seem easy, but flaggers are crucial for safety at job sites and are supposed to receive training, though not all do. Holden, Burns and Mahoney figured they can succeed where other companies have failed by paying flaggers more money. "These minimally paid positions can hold up $5 million in construction projects," Holden says. "We made a decision in getting into the business that we wanted to provide a better pay level to people who do flagging. The lower people get paid, the less likely they are to show up."
Maine Staffing Group's health and safety manager has instructed 100 flaggers over the last year, according to Burns. Last year, five of their flaggers were working at the Peter Dana Point project for Sargent Corp., a construction firm in Stillwater. The project is on hold until the weather warms up, says Doug Morrison, project manager at Sargent. "That's why we hire a temp agency ˆ because they're flexible," he says.
Finding people for the flagging positions won't be easy, though. That's one reason the three partners decided to open their Portland office. "We put a lot of effort into going to where people are instead of asking them to come to us," Holden says.
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