Hire Power

Hard-Won Success

By October, Leffall found himself behind his own desk in his own office, with a receptionist ready to hand out freshly printed brochures to clients. Unfortunately, there were none. "Like most entrepreneurs, I thought this would explode immediately," he says. "But for about two months, the phone didn't ring. We were making all these cold calls and no one wanted to talk to me. I was so discouraged because I really thought I had a good idea and business would pick up."

Flabbergasted by the curt responses from companies unwilling to deal with an unknown, and with only half his start-up loan to spare, Leffall decided to give his agency an infusion of credibility by joining the Oakland Chamber of Commerce and the National Association of Temporary Staffing Services. He sent mass mailings to Chamber members offering special rates and attended Chamber meetings and industry mixers. Slowly but surely, he won much-needed contracts. "That gave me more confidence to approach companies," says Leffall. "It wasn't much, but at least it was something I could talk to a prospective client about."

Those first clients, including Leffall's former employer, the Oakland Housing Authority, led to much more than small talk. Leffall Employment earned sales of $272,000 in 1997--up 100 percent from 1996. But Leffall admits those numbers seem more impressive than they actually were. Profit margins in the industry are so low that after paying expenses and employees, he only got 10 percent of sales for himself. "I got used to fixing Top Ramen in very creative ways because I couldn't go out," he recalls. "I couldn't buy new clothes, but I had a lot of my old clothes. So when people saw me, they'd think I was okay." It didn't help that for most of 1997, Leffall unknowingly charged half of what his competition was charging for services. Not getting paid by "the most unlikely sources," like doctors and lawyers, also became problematic. He found himself in court--a few times--just to be reimbursed for his work.

After sales and marketing became less tumultuous and many hard lessons had been learned, business looked brighter. By 1998, Leffall had the budget to hire a qualified full-timer to help with recruiting and placement. (He'd already gone through two not-so-qualified friends who agreed to work for low wages.) And word-of-mouth landed Leffall Employment Agency its first two large accounts: a three-year contract with the County of Alameda, California, which reaped $700,000 for the company last year; and one with Shell Oil Co. to payroll participants in its youth training program. Leffall still gets excited reminiscing about the day the president of Diversified Personnel, also in Oakland, called to ask if Leffall Employment was interested in partnering for the County of Alameda contract. "He wanted to meet with me that same day, but I was like, `Can we meet tomorrow?'" recalls Leffall. "I was just so elated. I knew I wouldn't be fully there at that meeting."

Since coming of age in the staffing world, Leffall Employment has forged ahead amid the sea of nearly 20 competing agencies in the Oakland area and has nearly doubled sales every year. From sales of $596,000 in 1998 to $1.3 million last year, Leffall expects that, after winning the City of Oakland bid last September, sales will double again this year. A mentor to high school boys and a volunteer instructor of youth entrepreneurship for Junior Achievement, Leffall will expound on his experiences in print with a self-published book titled Brother CEO this summer.

Risk-taking afforded him a chance to live the life he always wanted--even to buy his mother a new car. But would Leffall advise anyone to start a business without sufficient knowledge? "No way," he laughs. "Get practical experience by volunteering for a company in the industry you want to get into. It'll save you a lot of heartache, and probably a lot of money as well."

Contact Sources

Leffall Employment Agency, 7700 Edgewater Dr., #647, Oakland, CA 94621, (510) 613-8080.

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This article was originally published in the March 2000 print edition of Entrepreneur with the headline: Hire Power.

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