How to start a recruitment franchise

Recruitment is booming. Find out how to cash in on the trend.

What is it?
Who is suited to it?
Costs
How much can I earn?
Tips for success

Setting up a franchise is not for the fainthearted – it is stressful, expensive and nerve-wracking. There are no guarantees of success but starting with an industry that’s booming could be a help.

So this is our tip: recruitment is big business. Last year the industry had a turnover of around £23 billion in the UK alone and franchisors are eager to grab their piece of it. This is where you come in.

If you choose the recruitment business, you will be joining an industry which ranges from finance to catering, engineering to sales. And it encompasses everything from temporary work to permanent boardroom positions.

As far as franchising goes, there are broadly two kinds of recruitment on offer. At the commercial recruitment end of the scale, you should recognise the high street names. They cover a familiar market which handles work placement in a low to mid range pay bracket for both temporary and permanent contracts. Good examples are Travail Employment Group and Select Appointments, two of the largest franchisors in the UK.

The other side of the coin is executive search, or headhunting. MRI Worldwide is largest executive search company in the world and is the product of a merger between MRI of the US and Europe’s Humana. But it is not a household name and you won’t find it on the high street.

What is it?

The most common type of recruitment agency is one which hires out permanent, temporary or contract-based staff in office, industrial or catering jobs. The work is varied and people-based. It is a definite ‘supply and demand’ industry. Your role is to liase between employers and employees with a view to finding a perfect fit. So when an appointment works out, the praise is twofold. But if it doesn’t, the abuse can be double too.

In the beginning, your job will be selling yourself. For commercial recruitment, it is basically a process of cold calling, hopefully leading to face-to-face meetings and establishing contacts. And even when you have clients, you have to keep them while looking for more.

One franchisee said he has staff contacting companies between the hours of 10am and 12 noon, and again between 2pm and 4pm. All administrative tasks, including interviewing and organising advertising, are done outside these times. He added “there is a constant need to top up the pool of people in our client base. We do this by exclusively making visits and telephoning between those key hours”.

The executive search process is different. Meeting clients and using existing contacts will be the most important job. You will have to go out and canvas for support amongst clients and potential employees – particularly the former. No business exists without good customer relationships and a solid client base. As this is your business, that means your relationships and your clients.

In general, it is easier to attract people wanting jobs. With companies like Travail or Select, employees will come to you because they have heard the brand name — particularly if you have premises on a main street. A high street presence is not vital for a recruitment business but it can help.

In an executive search franchise, on the other hand, potential employees don’t walk in off the street. You work within a sector, such as IT or finance, and actively seek out people by cold calling and asking for suggestions.

Inevitably at the start, you will have to do whatever needs doing to get the business going and keep it running. You should expect to juggle looking out for premises, talking to the bank, managing your team, hiring and training staff, all on top of acting as a recruitment consultant. And most of all, be prepared to learn.

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  1. CNA International
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    There are three things to do before investing in a franchise. 1. do your due diligence, 2. do your due diligence, and 3. do your due diligence