The result wasn’t pretty! Gross Margin per WSE decreased 13 percent from 2007 to 2008 according to NAPEO, and the direct result of that was a 25 percent decrease in EBITDA. Ask yourself these questions: Did that get better in 2009? Looking great in that 2010 budget?
The hard truth is that insurance arbitrage is going in the wrong direction with little sign of stopping soon. Over half the states are “client retained” for unemployment, and trust that this recession will add the other half soon enough. Think health care reform won’t bring changes to pre-tax benefits, think again my friend. Consolidation and price pressure from the “big boys” is eating into your fees, and get used to the Gorilla at the door.
So whether you know it or not, your business is on or headed to life support with your arbitrage exposed and administrative fees under fire.
So what’s your next move? Ride it out? Hope arbitrage turns in your favor? That’s not a business plan…it’s a going out of business plan.
What arbitrage is alive and well? Labor cost and productivity!
Cognet HRO can get you off life support and back on the road to sustainable profitability.
We are a unique team of PEO professionals with many years of industry experience. We can offer you access to ISO 9001:2008 and 27001 certified global facilities without leaving your desk. We will get all into your processes with “six sigma” precision and ensure we squeeze both cost and productivity out of your PEO.
What else can you expect from Cognet HRO?
Put us to the test. Take our free business assessment to learn how Cognet HRO can put the profit back in your business.