Starting your own business is no walk in the park, to help you on the right path, take a look at our list of things to consider when starting a recruitment agency from our start up centre partners, New Millennia Group Limited
Embarking on a startup takes drive, determination and a lot of work, it’s not something to jump into without a little thought and consideration. You’ll be eager to get started, but thought and planning will go a long way towards helping you get it right the first time around!
Here’s a breakdown of specifically which things to consider when starting a recruitment agency:
Who Do You Want To Be?
The style of recruitment agency which you become may in part develop over time, however, you need to plan for who you want to be. At it’s most basic, this decision comes down to whether you’ll become a permanent staffing agency or a temp staffing agency. You can do both, but often an agency will focus on one, the benefit here is dealing with similar needs from all clients.
Dive into your options further, and your recruitment agency could provide an even more specialised, niche service and concentrate on one industry, this might be construction , nursing, or teaching for example. Whichever niche you choose when starting a recruitment agency, your branding, marketing and team may depend upon who and what your agency is going to be.
How Will You Secure Funding?
Starting a recruitment agency, like starting any business takes capital. The majority of businesses will need to secure this externally rather than providing this funding themselves, and there’s a multitude of ways in which you might choose to do this.
Option one, a bank loan; this is a common option for startup businesses and startup recruitment agencies alike, it gives you a lump sum of money to help fund your way through the initial stages of your business. For recruitment agencies, there are more convenient options available; factoring is a commonly used option, or we offer our own alternative to factoring as part of our services.
Invoice factoring allows a business the option of outsourcing their invoices, technically selling the invoice, to a third party. The factor will then provide, in advance of the invoice payment, the invoice amount to the business. However, the full amount is not paid initially, only a percentage, typically between 80% to 95%. Once the client makes the invoice payment, the remaining funds are released to the business, less any fees of the factoring company.
New Millennia offer an alternative to this factoring option which, with vast experience of working with startup recruitment agencies, we believe is more beneficial. You will outsource your invoice to us as you would with factoring, however, we will provide the full amount of the payment to you, not a percentage. This allows you more flexibility and room to grow, and we will collect the invoice amount for you, so no chasing clients on your to-do list!
Have You Planned & Prepared?
- Business Plan
A strategised business plan can send your recruitment agency on a successful trajectory. This includes planning out your aims, goals, values, marketing, financials, knowing your competition, where your strengths and weaknesses lie and how you plan on the business growing.
- Size
Among the many other things to consider when starting your recruitment agency are essential practicalities such as, where will your agency begin, will you start from home with your laptop for a while, or are you ready for a few more bodies and an office of your own?
- Legal
Do you have someone on board who can help with the legalities, the boxes you need to tick and guidelines you need to follow or legal bodies you need to contact?
- Experience
Evaluate your experience in the recruitment industry. Not only yours but if you’re starting as part of a small team, then evaluate all of your overall experience in the industry, so that you know, good or bad, what you are and are not adequately equipped to handle. From here it’s easier for you to fill in the gaps and be aware of your weaknesses.
- Threats
Similarly, (and you should have covered this in your business plan) know what your potential risks are and when they might be of threat to your business. Many of these may be external, if they’re internal, they’re often easier to get a handle on, and if they’re external, they often pose a larger dilemma. If you’re frequently losing candidates part way into the recruitment process, for example, then this can be fixed, change or shorten your process. However, economic factors, for instance, Brexit will be hard to successfully plan for and difficult to manage the effects of; by keeping up with industry trends and news you can be as proactive and reactive as possible when the time comes!
Work this all through before you start, a business venture of your own can be a slow start and planning and consideration is necessary, any entrepreneur, business owner or startup will tell you that, so get your ducks in a row and reach out for the necessary help before starting a recruitment agency!
New Millennia Group Limited offer the only true, fully insured, non-recourse, non-retention 100% funding facility in the market today. New Millennia Group Limited’s finance facilities have been used successfully since May 2000 by recruitment businesses just like yours. New Millennia Group Limited reviews every business’ needs case by case to help them grow as much as possible.
Contact details: Paul O’Rourke, porourke@nmgroup.co.uk, 0161 337 9882
