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Choosing between a single preferred supplier and a multi-agency panel involves trade-offs between pricing, resilience and relationship quality. This guide explains when each approach works best and how to manage either model effectively.
The decision whether to work with a single preferred agency or to maintain a panel of multiple agencies involves a genuine trade-off between the depth and value of a focused relationship and the operational resilience of having alternatives. Neither approach is universally correct: the right answer depends on the provider’s size, the predictability and volume of their agency use and the local market of available agencies. Most providers land somewhere between the two extremes, maintaining a primary preferred supplier relationship while retaining one or two backup options.
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Concentrating booking volume with a single agency creates several advantages. Higher volume drives better pricing through volume negotiation. The agency develops deep knowledge of the provider’s service, culture and individual service user needs, resulting in better worker matching over time. The relationship with a named account manager develops into a genuine partnership where the agency proactively supports the provider rather than simply filling orders. Administrative simplicity and consistency of terms are additional benefits.
A multi-agency panel provides operational resilience: when the primary agency cannot fill an urgent booking, a backup is available. For providers in areas with a limited local worker pool, no single agency may have enough available workers to fill all requirements reliably. Different agencies may have different strengths: one may have a stronger nursing pool while another has better availability for overnight support worker bookings. A panel allows providers to direct specific types of bookings to the best-placed agency.
Relying heavily on a single agency without any backup creates significant operational risk. If the primary agency loses key staff, faces compliance issues, is acquired or simply cannot fill a critical shift at an important moment, the provider may have no fallback. This risk is particularly acute for providers in areas where local worker availability is constrained. Building at least one backup agency relationship, even if only used occasionally, is important risk management.
Using a large number of agencies simultaneously creates its own problems. Booking volume is spread too thinly for any agency to develop good knowledge of the service or to prioritise the relationship. Administrative complexity increases with multiple invoicing relationships, different terms of business and multiple contacts. The agency is less motivated to invest in the relationship when it receives only a small proportion of total bookings. Worker consistency across placements is harder to achieve when many different workers from many different agencies are used.
If using a panel of agencies, structure it clearly: designate a primary preferred supplier that receives the majority of bookings, a secondary agency that is approached when the primary cannot fill and possibly a tertiary for specialist requirements. Establish clear rules for which agency is approached first and under what circumstances the next agency is contacted. Brief all agencies on the service to the same standard and maintain consistent feedback across the panel. Review panel composition and volume allocation regularly.
Providers should renegotiate their agency arrangements periodically, typically annually, reviewing pricing against the market and the agency’s performance against service quality expectations. If an agency consistently underperforms on worker quality, responsiveness or compliance, it should be given a clear improvement period with specific expectations. If performance does not improve, switching the primary supplier relationship to a better-performing agency is appropriate. Maintain the contractual relationship with the underperforming agency as a backup while the transition is managed.
For related information see our articles on How to Choose a Care Agency and Common Mistakes Using Care Agencies.
Most providers benefit from maintaining a primary preferred supplier that receives the majority of bookings, for the benefits of relationship depth, pricing and service quality, supplemented by one or two backup agencies for resilience. Using too many agencies reduces the value of any individual relationship. Relying on only one agency without any backup creates operational risk.
Two to three agencies is the typical sweet spot for most providers: a primary preferred supplier and one or two backups. This provides relationship depth and pricing benefits from the primary while maintaining resilience. The right number depends on the provider’s size, the predictability of demand and the depth of the local agency market.
Consider switching your primary agency if it consistently underperforms on worker quality or responsiveness, fails to address compliance concerns you have raised, provides unexplained or disputed charges, or if you identify an alternative agency that can demonstrably provide better service for your specific needs. Give the existing agency a clear improvement period with specific expectations before switching, and maintain the relationship as a backup during the transition.
Visit our Health and Social Care Agency Resource Hub for more guides on staffing, compliance, CQC standards, agency costs and how to choose the right care agency for your organisation.
The information in this article is provided for general guidance only and does not constitute legal, regulatory or professional advice. Regulations, rates and compliance requirements change: always verify current requirements with the relevant regulatory body. SENDhelp Education Limited accepts no responsibility or liability for any loss or damage arising from reliance on this content. Any links to third-party websites are provided for convenience only and do not constitute endorsement of their content.
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