Recruitment. Easy as ABC isn’t it?The Recruitment Industry is a fantastic sector of industry to work within.
Yes it takes a lot of hard work and dedication and yes it requires stamina and a thick skin at times (and it’s a rollercoaster of highs and lows) but it really does offer the whole package in terms of job satisfaction, daily challenges and most importantly – financial rewards.
A very common (and inaccurate) myth in the start up community however is that starting up a recruitment business is an easy thing to do, with little planning necessary in the early stages and only telephone directory and a mobile phone required to get you going. For those recruitment businesses thriving in the current market, I am sure they would all support me in saying that there is a lot more to it that that if you are going to be a real success.
As a specialist mentor within Recruitment Business Start up’s I deal with hundreds of enquiries from entrepreneurs looking to take the plunge. Their concerns (and mine) always seem to pivot around the same key business areas and over the next few months, I shall be working with UK Recruiter and their business partners to bring you weekly guides and support via this new and exciting web portal – developed for the Start up Community.
In this week’s edition, we shall take a quick look at a handful of the initial thought processes we would recommend considering in the early stages;
Do you have the skills and/or background to be a recruiter
Successful recruiters are people who can turn their hands to a number of key skill sets. They are incredibly self-motivated, hungry for success, excellent sales people (both over the phone and face to face), they are highly organised, competent administrators, have good short and long term memory skills and above all are excellent relationship builders and account managers.
In a larger recruitment businesses it could be forgiven that you are only a good sales person and the business that you work for can pick up the slack in some of your weaker areas but for a start up business it really is important that you can manage to become accomplished in all of these key areas in order to become a success.
Do you think that you have what it takes? Can you pick up the phone and quickly build a relationship with a total stranger in a matter of minutes? If your answer to the above is “no” then unless you are going to employ someone to conduct all of your sales for you, then this is not the industry for you. If you feel that you have a mentality to be a sales person but not the expertise, then industry specific sales coaching and training is available for those who wish to learn.
Have you defined your market?
Planning is key when starting up in recruitment. You need to ascertain which market will be the best for you to set up in. I am a strong believer in doing what you love, so if there is a market in which you are already familiar or have passion within, this is probably your safest option.
Alternatively, there may be key resources or information available to you, which have driven you towards an alternative sector or location in the UK or Globally. Regardless of what these factors may be, you need to establish if there is a viable and sustainable market for you to tap into, via thorough and realistic research practices.
Have you the funding in place?
Probably the most frequently asked question I am presented with is “How much does it cost to set up a recruitment business?” and my response is usually “How long is a piece of string?”.
I have worked with start up’s with £250,000 in the bank and those with £250 in the bank. The amount that you spend is relative but does not have to impact on how successful your business will become in the long term. £5,000 is a nice round sum. It can cover your initial set up costs, a half decent website, contracts, compliance and a small buffer to keep you afloat for the first placements to come in but if you can manage to acquire slightly more, it will certainly help.
If you are looking into setting up a contracts or temps desk then you will face more immediate challenges in terms of cash flow and additional sources of funding will become necessary. Cash flow is king and for many start up recruitment businesses is often their downfall in the early stages of trading. It is therefore vital that you include a full P&L projection as part of your business plan and get the correct levels of funding in place.
Have you checked out the competition?
You need to carry out your own, robust research before starting up. Even if you feel confident that you have the skills and the know-how it may be that the market is already saturated within your target area and market. If you want to improve your chances of success, you need to know who your competitors are, what they offer, who they offer it to and for how much! A thorough competitor analysis is an essential part of your planning process.
Do you know USP’s and Differentiators?
How will you separate your selves from the competition? First of all you need to know what you are up against but secondly you need to be able to articulate the unique selling points (USP’s) for your business and how they will differentiate you from the competition. Simply saying that you are an ethical, caring recruiter isn’t always enough these days. Think outside of the box and be innovative... What else can you offer? Look at your niche, rates, rebates and value adding services.
How will you market and sell your services?
Recruitment is a fiercely competitive market and not only do you need to be able to sell your services but you also need a really robust and engaging marketing plan (and on-going campaigns) to engage with your target audience. Working with a recruitment business mentor, marketing specialists and on-line SEO guru’s can help you to get the best out of the technology available to you and to maximise the traffic visiting your website. You need to make yourself visible and accessible to your clients and candidates through as many different media channels as possible (following them all up with immediate sales activity).
Do you understand the legal implications of starting up?
The recruitment industry is heavily regulated (in some sectors more than others) and good advice from an experienced recruiter with a strong background within compliance and regulation within the early stages of starting up is highly advisable. Improper processes and procedures could land you in extremely hot water with the Department of Business Innovation and Skills (DBIS) and leave you wide open to legal disputes in the future. Make sure that you have the correct compliance in place (including a robust set of contracts to use with both your clients and candidates) and work towards compliance with the Conduct Regulations for Employment Businesses 2003 (amended 2005, 2007, 2008, 2010). Membership to a regulatory body such as the REC, The IOR or APSCo might also be of interest.
There are many things that you need to have in place or consider when starting up a recruitment business and we shall be covering these week by week to try and give you the best possible start. Recruitment can be easy but assuming you can jump straight in with little thought would be unadvisable.
If you feel that you would like to speak to someone and gain some additional peace of mind about how best to proceed, please feel free to give me a call - Alison Kennedy FIRP DipRP on 07712 744342. Recruitment Business Solutions Ltd, offer comprehensive support and guidance for recruitment businesses and will be able to work with you step by step to ensure that you have the processes and procedures in place to operate not only effectively but compliantly too.