Barrett beefs up staffers for a host of companies
Barrett Business Services, which held onto its No. 1 spot in The Seattle Times’ 23rd annual ranking of publicly traded Northwest companies, had a strong year of taking on even more clients around the country.
Seattle Times business reporter
Barrett at a glance
Headquarters: Vancouver, Wash.
CEO: Michael Elich
Employees in 2013: 468 corporate employees. Contract employees include 8,600 in staffing and 70,250 with professional employer service clients.
What it does: Outsourcing services for small and medium-size businesses, including temporary staffing, payroll, recruitment and human resources.
What sets it apart: 74 percent of its revenue comes from California
2013 cash flow: $66.1 million
2013 revenue: $532.8 million
Years in ranking: 17
Highest ranking: 1 (for 2004, 2012)
SEC filings, Bloomberg
Pexco, a plastics and vinyl manufacturer outside Tacoma, has 100 permanent employees making privacy slats for chain-link fences and other products throughout the year. But during the summer months, when more construction jobs are under way, Pexco needs more help.
“Our business is very cyclical,” said Steven Andrews, plant manager at Pexco in Fife. “Not much happens during the winter, so we need to be able to ratchet down our workforce during those four months of winter.”
For the last eight years, Pexco has brought in temps through Barrett Business Services to pick up the slack.
Pexco is just one of many companies Vancouver, Wash.-based Bar-rett helps with staffing in Washington. And after a strong year of taking on even more clients around the country and posting a $17.9 million profit, Barrett held onto its No. 1 spot in The Seattle Times’ 23rd annual ranking of publicly traded Northwest companies.
“We’ve always taken the approach of expanding the number of companies we work with, as it’s one of the few variables we can control,” Barrett CEO Michael Elich said in a statement. “We don’t impact the size of our client companies, how many hours their employees work, or their rates of pay, but we can effect the number of client companies we interact with.”
Founded in 1965, Barrett helps businesses find temporary staff as well as take over payroll, human resources and recruitment tasks that often take owners of small- and medium-sized businesses away from the core of their businesses, said Steve Bevins, Barrett’s Puget Sound area manager.
“In Seattle you are in the fifth-largest economy in the United States, so everything is manufacturing, light industrial and then it boils down to the distribution because you have two of the top 10 ports sitting here, too,” Bevins said about the heavy manufacturing and distribution focus around Puget Sound.
“Like any industry, it tends to be seasonal so the companies have their ups and downs and they use us to help with those spikes and bounds,” he said.
Even though Seattle-area clients mainly use Barrett to help with staffing, two thirds of the company’s $532.8 million revenue in 2013 came from professional employer service (PEO) clients — those clients that use Barrett for its payroll and human-resources expertise.
In those instances, Barrett co-employs some of its clients’ existing workforce, assuming responsibility for payroll, payroll taxes, workers’ compensation coverage and other administrative functions, but the client still has control over hiring and firing.
Barrett served 3,200 PEO clients last year. Companies in California and Oregon make up 82 percent of the company’s revenue.
In total, Barret has 79,315 employees: 8,600 in staffing, and 70,250 with PEO clients. The other 465 are managerial, sales and administrative employees in addition to three executive officers.
Barrett competes against similar staffing and human-resources companies such as Kelly Services, Manpower and Paychex.
Even though the company has made the Best of the Northwest list 17 of the last 23 years, the company struggled through the Great Recession. Its stock hit a low of $7.92 in March 2009 after trading at highs between $18 and $27 per share in previous years. It experienced an incredible runup to end 2013 at $92.74 a share.
In 2012, Barrett faced another challenge when California passed a law affecting insurance for any company in the business of providing employees to other employers.
As California is its largest market, Barrett saw some increased costs during the transition to a new insurance arrangement, but Elich said the company found a solution. “Addressing the issue has been incredibly valuable, opened up some new relationships and has ultimately made us a better company.”
After landing on the top of The Seattle Times list three times, Elich said he is not getting caught up in the accolades — he said he wants his company to focus on providing value and helping small-business owners build better companies.
“Our economy is built on the backs of small-business owners and most of the country’s employment comes from those companies,” he said in a statement. “We will always work to be better tomorrow than we were today.”
Coral Garnick: 206-464-2422 or firstname.lastname@example.org.