How to Start a Recruitment Business
The job market today is highly competitive and candidate-driven making the task of interviewing, shortlisting and hiring appropriate candidates for your company a daunting task. Most companies would rather not subject themselves to all that ...
The job market today is highly competitive and candidate-driven making the task of interviewing, shortlisting and hiring appropriate candidates for your company a daunting task. Most companies would rather not subject themselves to all that therefore choosing to use the services of a recruitment agency to help them find an appropriate candidate to fill their vacancies.
A recruitment agency is a company that is paid by other companies to find the ideal person to join their team. They are the middlemen between companies and people seeking employment.
There are four main reasons why a company will choose to use a recruitment agency to handle its hires. They include;
To save time: the process of hiring individuals can be time-consuming and most companies would rather use this time to focus on the growth of their company. Also, since the main focus of recruitment agencies is to find people seeking employment, they probably have a ready pool of candidates suitable for the job vacancy that needs to be filled. This, therefore, makes the hiring process take less time.
To improve the quality of hire: most recruitment agencies are focused on a specific function. This means that the candidates they have are all highly qualified in their area of specialization.
For added security: sometimes a company can hire someone then the employee quits the job after a short while. With a recruitment agency you will be guaranteed that their candidates will work for up to a certain period which is usually about 3 to 6 months. In case the employee leaves the company before then, the recruitment agency, in most cases will give you another suitable candidate to fill in the vacancy.
Now that you have an idea of the functions of a recruitment agency, let’s find out how you can start a recruitment business;
Check your skills
Starting a business requires you to have adequate skills and knowledge to work in that line of business. It is no easy task running a recruitment business worse still, if you don’t have the right skills it will be impossible to make this business a success. Before going the extra step of starting your recruitment business you should first consider working for a recruitment agency to get a gist of how business is conducted.
Secondly, it is important to invest in recruitment training programs such as online webinars and purchasing training materials to increase your knowledge of the business.
Lastly, you need to ensure that you have the right qualities and skills for the job such as communication skills, problem-solving skills, sales and negotiation, teamwork, organization and prioritization, and time management skills. These skills will come in handy when dealing with companies and candidates as well.
Choose a focus
In most cases, recruitment agencies choose to focus on a specific industry. That is, they can choose to only work with the hospitality, construction or healthcare industry. When thinking of starting your recruitment business. You can decide which industry you want to focus on or you can decide to work on multiple.
The next step is to decide on a niche within your area of focus. A niche will help you to distinguish yourself from your competitors. You can decide to either work with part-time or full-time employees or you can decide that your main focus will be to help entry-level applicants find placements in jobs.
Generally, there are three types of recruitment services. They include;
General recruitment agencies: this type of agency focuses on recruiting for a specific industry such as hospitality, sales or healthcare. They are the best for finding entry and middle-level employees.
Staffing recruitment agencies: they are best suited for hiring temporary workers.
Executive recruitment agencies: best suited for hiring top-level candidates. They specialize in executive recruitment.
Each choice has its advantages and disadvantages; it is therefore important for you to conduct market research on each before making a decision.
Build your business
Now that you have a clear picture of what your business will be about, it is time to start making it a reality.
Find an accountant: This is the first and most important step especially if you have never run a business before. An accountant will guide you best on how to go about creating your company, how to register for tax and how to claim business expenses.
Calculate the startup cost: With the help of your accountant, you can estimate how much it will cost you to get your business up and running. Your startup cost should include overhead costs, insurance, permits and licenses as well as employee benefits (until companies pay, you will be required to pay your employee(s) from your pocket.)
If you do not have enough money to cater for a startup, you can always consider applying for a loan or a business grant.
Decide on a location: When you are just starting, you can decide to cut down on cost by working from home. All you will need is a website associated with your business where you will be placing the job adverts. As your business grows, you will find that you will need a convenient space to carry out your operations such as meetings and interviews. You can then rent out an office space for this.
Register your business: this involves obtaining all the necessary permits and licenses required by your state to run a recruitment business. You will also need to obtain insurance for public liability, personal indemnity, employer’s liability and your business.
Set up a bank account: now that your business is all set up, you will need a separate account for your business to make it possible to receive payments from clients.
Market your services
It will be impossible for people to know about your business and the services you offer without proper marketing. This will involve identifying a list of potential clients, companies, and individuals looking for employment. You will then contact them either by email, telephone call or personal visits.
Other reliable forms of advertisements include placing ads on newspapers, magazines and online job sites. You can also hand people your business cards and put up posters. You can also run ads on online sites such as LinkedIn, Facebook and Twitter, you will likely attract companies seeking your services as well as candidates seeking employment.
Build relationships: the basis of a successful recruitment business lies in establishing good and trustworthy relationships with clients.
Network: online platforms have us thinking that we can network with people from the comforts of our homes. As much as this is not entirely false, a good networking circle that is built on trust is mostly formed in one on one interactions during meetings and events.
Lastly, be flexible with your services and also avoid working for companies that you are not familiar with. This will help minimize cases of unpaid fees for services provided. Remember you are in this for the profits and such scenarios could set back your business.