Mr. Meier: Outsource International is a provider of flexible staffing, particularly to the light industrial marketplace. We provide staffing services through our Tandem Staffing division, primarily to four major vertical targets. Those targets include manufacturing, distribution, construction, facilities management/hospitality, as well as other general light industrial segments. The company is a NASDAQ traded company on the OTC marketplace, trading under the symbol OSIX.OB. The company has approximately $285 million in annualized revenue, is profitable for year 2000 and provides services through a network of 84 branch offices that the company owns and then a franchise system of approximately 54 locations that are franchises. Our distribution strategy is in cluster markets. Our cluster markets include the Chicagoland area, Milwaukee, Detroit, Kansas City and St. Louis in the Midwest; Atlanta to the southeast end of Florida in the Southeast portion of the country; and in San Francisco, Los Angeles, San Diego, Phoenix, and the Denver area on the West coast. We provide service workers at a rate of about 23,500 service workers per day and we have been in business since 1974 when the predecessor company was known as Labor World. The company became public in October 1997 as Outsource International and has been public since that time. I came to the company approximately one year ago as a result of the company having performance difficulties for the years 1998 and 1999. In the year 2000 we took the company through a significant restructuring and turnaround program which has allowed the company to return to profitability and put it on a solid platform so that we can now orderly grow our organization.
TWST: What is changing today as far as your customer base and your
client base? How do you see those changing or evolving over the next two
to three years?
Mr. Meier: I think there are three forces that affect our customers. In
the near term, I think we're going to be under some recessionary
pressures as we all know, which accelerates the need for flexible
staffing and for our customers to manage their labor costs more
effectively and more efficiently. So it's on us to help our customers
provide human capital planning methodologies and help our customers deal
with the recessionary pressures so that they may retain their margins.
The second significant force on our customers and on our business is
that we clearly have a labor shortage or supply-demand imbalance. We
know that the labor supply for the light industrial or the lower skilled
segment of the economy will grow at a rate of about 2% and we know that
demand is going to exceed 9%. So, we are going to need to help our
customers, if you will, 'manufacture' workers, and are going to have to
do a better job of recruiting and facilitating people to come off the
welfare rolls into the low skill work force. The third factor is what I
will call 'the velocity of the worker.' The fact that lifestyles to date
are walking away from much more traditional employment where people have
8:00 AM to 5:00 PM jobs or work for companies for an extended period of
time. We are going to have to help our customers manage what I refer to
as 'the free agency of workers' and the velocity associated with that
free agency through retention programs and other value-added services. I
think if the company and our customers deal with those three forces
effectively over the next 18 months, we will both succeed.
Tickers included in this excerpt: OSIX
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