How to set up a recruitment business
Thinking of launching your own recruitment business? Here are five steps towards your goal.
If you’re wondering how to set up a recruitment business then we’ve got good news: it’s not as out of reach as you think. Find out how you can get yours off the ground with these five steps.
1) Choosing a name
Although seemingly obvious, the name you choose for your business will not make or break your new recruitment firm – the quality of service you provide is much more important.
So don’t fixate on choosing the perfect name, just make it as simple as possible for people to find you online. It’s also important to make sure your name has not already been taken and that the domain is available too.
2) Write a business plan
Next, you need to create a business plan consisting of an outline of yourself, your business, market research and costs, and business forecast. For information about yourself, include what makes you a good fit to run this type of business and why you may want to run one. In this section, you must also give an overview of your experience and qualifications.
You’ll next need to pinpoint your business aims, such as the sectors you want to work in and your demographic. For your market research, include your target market and competitor companies, highlighting how your company will gain traction and stand out in the market.
3) Find employees
Paying employees on a contingency basis is the most common way to go about things. However, the other option is retained recruitment, where you go out and search for candidates who are suited to fill a certain role.
As a result of the long process this entails, you can charge 30% more. Building long-term relationships are crucial, and so you may want to be flexible with your fees in the beginning stages.
4) Choose your area
If you want to get a foothold in the market quicker, it’s a good idea to specialize in one area or niche. This is how many smaller recruitment agencies have triumphed. You can look at a particular industry or type of employee, or even fill a gap left by your competitors.
5) Work out your costs
There are a few start-up costs to consider before starting your recruitment business. Firstly, a website is crucial for attracting interest and promoting the face of your brand. In the same way, the software will eat into a certain percentage of your available funds. CRM software and accounting software are two areas needing to be looked into.
Office space is another obvious one, required in a financial hub so that clients can easily access it. In this office space, technology and good internet is pivotal, as well as salaries. On average, each recruiter in London earns £30,000, alongside commission which will be around £5,000.
Marketing is also another crucial cost in a start-up recruitment firm. Knowledge of the business is where the company can gain traction and awareness, therefore generating profit. Social media campaigns work the best here but always start small and build up to conserve your funds early on.