My top 10 tips for starting up a recruitment business

With multiple businesses under his belt, recruitment industry veteran John Buckman reveals the golden rules for success in the sector

I started, and built, Jark Recruitment, one of the leading recruitment companies in the UK. With that experience, a great team behind me and time to do it, I then started Recruit Ventures in 2012 based on a unique business model I developed.

Designed specifically for recruitment professionals, it helps them start their own businesses, as joint ventures, with 100% funding, a guaranteed salary, no personal financial risk and access to a full back office support function. It’s worked exceptionally well, growing into a £41m turnover business with 18 joint venture partner businesses spread over the UK.

In fact the model worked so well that I restructured Jark itself to operate on the same lines. That’s led to there being nearly 40 recruitment companies in the UK that I’ve been directly involved in starting up.

Drawing on that experience I’ve identified my Top 10 Tips for starting a recruitment business and here they are

1. Start with clear idea.

If you’re thinking of starting up you’re probably a recruitment professional who wants to use your experience to ‘do it your way’. You’ll be looking to reap more of the rewards of your own hard work, and you’re probably bursting with ideas on how to run your own agency. All of that is good. But, be clear about what you want to do. Identify the sector or sectors you know most about, go with your current experience. Decide what it is that makes you special and how you can shape a business that offers something your competitors don’t.

2. The finance.

Plainly it’s essential, but is it straightforward? No. First off you might consider a franchise deal. It might work for you but do you really want the constraints that come with it? Why would you be going it alone if it means working under another brand?

It’s possible that you’re massively rich and want to start a business to relieve the boredom. Let’s assume that that’s not the case. (Even if it is you’ll need to think very carefully about how much of your capital to invest, what the return is likely to be and how long it will last before you see income arriving).

The most important thing is to have funding in place for both the longer term implications and the short-term demands. There will be start-up costs – premises, branding, computers and of course staff – even if that’s just you! Longer term you’ll need to ride out the cashflow implications of the early days. At best you’ll be spending money 30 days ahead of income.

Ideally then you need funding to cover all of that, and really ideally, to have it from someone who understands recruitment and the unique demands it makes. With the best will in the world the average bank manager is not an expert in your field of business.

3. Get the systems sorted from the start

You may well feel that you’ve had enough of your job as a recruitment consultant, and that you could do a better, and better rewarded, job on your own. But the minute you leave the day job you’ll realise just how much you depended on the back office systems and software that came with it.

Even if you start up completely on your own you’ll need better systems than your trusty old laptop can provide. Cashflow, candidate details, employer client records, vacancies, CVs – they all need handling and that’s without the actual applications process.

You will crash and burn very soon after take-off if you don’t have robust, tried and tested systems on which to run the business. The recruitment industry has essential procedures and without them all your efforts will flounder. Get the back office in place before you make the first pitch.

4. Branding

In theory you can pick up the phone and start making appointments. “I’ll worry about the logo and branding later. Let’s get some business in first.” Wrong! This is a competitive market and a nameless one man (or woman) band, no matter how good your reputation, just won’t cut it.

In some ways of course this is one of the most exciting bits. Your brand. Your logo. You’ve probably given it lots of thought and have your own ideas. Because everybody’s an expert on coming up with ideas for branding, and with today’s technology anybody can do it. Wrong again!

Get expert help. Your bank manager may not be an expert in recruitment. And you’re not an expert in writing and design.

5. The website

See the fourth tip above! The same applies. No matter how tempting the downloadable packages and templates are, you need professional help and guidance to get your website up and running and properly, and creatively, designed and built.

Also, no matter how small you are to start with you must have a website. Even if you have brand new, smart, premises, the website is your shop window. It needs to be creative, but keep it simple to navigate. Make sure there are clear signposts for candidates and employers to find the sections relevant to each of them. And that you have the right message for each of them.

And make sure you promote the website address. The smartest website in the world is of no use if nobody knows it’s there!

6. Research your market

This is probably a good time to point out that you’re going to have to be doing ‘all of the above’ at pretty much the same time. So be organised.

Research is vital. Obviously you’ll have recruitment experience. Why else would you be doing this? But, now that you’re planning to be your own boss you need to really know the market you can best aim at and service. What geographical area can you cover? Are there any specific industries or recruitment requirements that are prevalent on your patch, and can you take advantage of them? Do you have special knowledge of any market sector that you can exploit? Who is already operating in your area, and how much competition do they represent?

If you’re doing this properly the answers to some of those questions will inform how you ‘frame’ your branding and company message.

7. Develop and plan

You might think that items one to six are enough planning to be getting on with. They’re all essential but they’re not the whole picture. You won’t get far without a proper business plan, and it’s advisable to get expert help in preparing a strategy that sets out achievable goals and expectations.

I’ve talked about your branding and identity but you need to plan your marketing campaign to get your message out there.

Crucially, you need to plan your income and expenditure forecast. You need to establish how you’ll be able to sustain yourself financially from the outset. You also need to plan ahead for the next stage. Do you have a specific goal? How are you defining it? By a turnover target? By plans to expand? If you don’t know where you’re going – you probably won’t get there!

8. Play to your strengths

Frankly it’s just as important to know, and address, your weaknesses, but let’s stay positive! This is a vital area and, if I’m honest, one I’ve learned the hard way. The reason you’re setting up on your own is to ‘do it your way’. You feel confident about doing it because you’re good at what you do. You’re probably running a busy desk or team right now. But here’s the thing, when you become the boss you’re going to have a lot more responsibilities. There’s a lot of administration to sort, the rent to pay, staff issues to resolve and of course there’s juggling the numbers to service that loan you took out to get started. All of that distracts you from what you should be, and wanted to be, doing which is getting out there, finding clients and candidates and growing the business.

Stay focused. Get on with the big tasks. Which means you’ll need to have got yourself organised with the right help.

9. Get the right help.

If you’re planning on putting a team together at the outset I’ll assume, hopefully correctly (!), that you know enough about recruitment to find the right staff for yourself. But it’s wider than that. From the financial backing to the marketing you need the right experts around you. Ideally they should be people who know about recruitment.

And don’t forget supplier relationships. You need to think about hardware, software, furniture and maybe a car. You need good deals on all of them especially at the start, so build good relationships with suppliers. As you get into your stride the supplier relationships will become, to be frank, secondary to the client relationships, but it’s important to maintain them. It helps build your reputation. Those suppliers are also good sources of referrals – and potential clients!

10. Do it!

That’s the big one! The above list may seem a little daunting, but ultimately you’ll never get started unless you take the leap. Take your time to plan properly by all means. I mean everything I’ve said so far. But ‘maybe next year’ usually leads to ‘if only I had…’

John Buckman is chairman of Recruit Ventures and a true entrepreneur himself. Having launched and grown many successful businesses especially within the recruitment sector, John’s expert knowledge and experience grants him the opportunity to offer advice and support to others in the industry considering setting up on their own.                                                       


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