How to Reduce your Recruitment Agency Start-up Costs
The question of how much it costs to start a recruitment agency is much like asking how long a piece of string is. That may indicate the early days of your new agency will be uncertain ones, but it also points to the considerable scope that exists to keep your start-up costs to a minimum.
The initial process of starting a recruitment company is actually relatively affordable – the combined costs of limited company registration, and Internet and phone service should leave you with plenty of change from £100 after the first month.
But those are only the bare essentials. You’ll therefore need to consider what other elements a recruitment agency really needs, and how you can reduce your expenditure on these without overly compromising your start-up business’s chances of success.
Your recruitment agency’s website
The digital, highly interconnected world in which we live makes a website for your recruitment agency all but essential. The good news is that you can save money here by simply building your first recruitment website yourself, using solutions like WordPress and Wix and consulting the wealth of information online on how you can design and build an effective business site.
There are, however, ongoing costs to consider, such as for the search engine optimisation (SEO) that will assist in keeping your agency ranked prominently in the search engines, as well as the management of your social media pages that will help you to accumulate a strong base of engaged followers.
As your agency grows, you may therefore need to get a digital agency to oversee these elements for you on an ongoing basis, which may also make the costs more predictable from month to month.
The expense of advertising on recruitment job boards
Your young recruitment agency stands to make a much bigger impact if it can extend its online presence well beyond its own website and LinkedIn profile. When you are looking for the best talent to fill your open roles, for instance, you will probably need to advertise those vacancies on other reputable online recruitment sites.
The costs of this will depend on such factors as the popularity of the job boards in question, how detailed your adverts are and how highly you would like your ads to be placed on the search results pages of these sites.
The most advantageously placed ads on the most popular sites will naturally be expensive. However, such a cost may represent a good investment, particularly if a discount is on offer to agencies posting multiple jobs on a given site. Otherwise, such measures as only posting the most basic adverts with no photos – at least to begin with – and writing the job ad copy yourself instead of employing a suitably experienced freelancer, may help to reduce your costs.
In what other areas can you save money?
Every placement that you make and vacancy that you fill requires a contract – and unfortunately, as these are legal documents, they need to be drawn up or at least approved by a lawyer. Given that lawyers frequently charge by the hour – typically about £300 an hour – this is a cost that can quickly accumulate. However, it’s also one that can’t be avoided, given the importance of contracts to your agency.
A customer relationship management (CRM) system is another vital investment for any start-up recruitment agency, given the wealth of data that will need to be managed for clients and candidates alike. You can’t hope to get by with an Excel spreadsheet, but you also can’t build a CRM completely by yourself. You will therefore need to get in touch with a specialist or use an external provider’s CRM, considering the options on the market and which ones represent the best value for money.
With all of these elements and the usual overheads applicable to any new business – such as rent or commercial mortgage payments, insurance, rates and more – to consider, keeping your young recruitment agency’s costs low may not be easy, but the results of such work can be dramatic and more than worthwhile.
If you would like to be helped along in the early days of your business by our own short-term recruitment funding solution here at TBOS, please contact our office.