HOW TO START A RECRUITMENT BUSINESS IN 2019
If you’re already a successful recruiter for a booming recruitment agency, chances are you’ve thought about starting your own recruitment company one day. Even with Brexit uncertainty, the Recruitment industry is still growing with an impressive turnover of £35.7 Billion recorded in 2018, which was an 11% increase to its previous year.
2018 INDUSTRY TURNOVER BREAKDOWN £30.85 Billion generated through Temporary/Contract placements
Approximately, £4.84 Billion through Permanent placements
With those staggering figures, are you ready to take a slice of the recruitment pie?
We thought so, let TBOS give you the full details on...
HOW TO START A RECRUITMENT BUSINESS
DECIDE ON A COMPANY NAME
First impressions are important, your company name is going to make a statement to your clients and candidates, so you must choose something that isn’t too long or hard to pronounce as people will need to access it easily. It’s definitely worth spending some time on this as re-branding later on down the line can often be costly and cumbersome.
REGISTER FOR A WEB DOMAIN & BUSINESS EMAIL ADDRESS
Once you have decided on a company name, you will need to buy a web domain and business email address. You can check available domain names online using Reg 123 and GoDaddy. Your company name must be the same across your website domain, business email address and social media channels when you create them, this will help with your SEO efforts later on.
FIND YOUR NICHE
If you have some experience in the recruitment industry already, you should have a good idea of the industry you want to start recruiting into. Remember the more niche the better, the recruitment industry is a fiercely competitive market, in order for you sustain longevity you need to be seen as a specialist recruiter in your field. For example, if you have years’ experience in recruiting for the pharmaceutical industry, use it to your advantage to start a database of clients and candidates within this field. This will give you a clear objective from the very beginning rather than spreading yourself thin across different industries which you have little knowledge about. You can always broaden your placements later on when you have a steady income coming in on your primary recruitment placements.
RESEARCH YOUR COMPETITORS
When starting out you should be looking at who are the key recruitment players in your chosen industry. You can do a competitor analysis, how does their website look? How accessible is it for candidates to register online? Identify their strengths and weaknesses and note how your agency will be different. You can learn from your competition and their mistakes, giving you a competitive edge in your field when you start trading.
RECEIVE BACK-OFFICE & ACCOUNTS SUPPORT FROM DAY 1
TBOS has had the pleasure of helping hundreds of top-billing recruiters on their journey to starting their own recruitment business. We have specifically designed our solutions to give recruiters the best possible start in the industry, so much so, there are no fees until you make your first placement.
We can help with company formation, introductions on business banking, service supplier discounts, tax registrations and much more. Unlike our competitors, you’ll receive full start up support and specialist advice from day 1, with our team covering the complete administration up until your first placement and thereafter. Our solutions are also pay-as-you-go, meaning our fees are based on your productivity. This is a significant saving from the very beginning and provides a rolling contract so you’re not tied into any long-term agreements, which is perfect for start-ups finding their feet in the industry.
Registering Your Company & Tax Registrations
You must register your new business at Companies House and then complete the necessary PAYE, VAT & Corporation tax registrations on the gov.uk website, please note this is a lengthy process and must be completed correctly. If you have any business partners their shares will also need to be registered correctly. Any mistakes made during this process will cause problems for your business at a later date.
As a new recruitment business, you will need Employers’ Liability Insurance and Public Liability Insurance, there are a number of comparison sites you can use to broker the best deal for your agency. It’s definitely worth shopping around on these online.
Having a robust set of permanent Terms and Conditions, client and candidate contract agreements and internal staff contracts is important to protect your agency from any legal claims. It will also ensure that your clients make payment against the invoices you raise. Acquiring contracts from your previous recruitment employer is definitely not recommended. Professional bodies such as the REC have contract template services you can use or you can obtain these from an employment lawyer.
Processing Personal Data
As you will be processing personal data, you will need to obtain a Notification to Process Personal Data, you can apply for this at Information Commissioner’s Office.
Are you looking to work with previous clients from your last agency? Be sure to look at your previous employment contract as there may be clauses that prohibit you from working with previous clients for up to a 12-month period. You should look for clauses that read Non-Competition, Non-Solicitation or Non-Poaching as this will restrict you from reaching out to previous clients.
Your new recruitment business must comply with The Conduct of Employment Agencies and Employment Businesses Regulations 2003. Click the link to familiarise yourself with this legislation.
If you need to obtain finance either to cover initial start-up costs or to fund contract placements, it’s worth giving our team a call to discuss your requirements in more detail. We can give specialist advice on the best business loans and negotiate invoice finance rates on your behalf so you don’t get ripped off. Unfortunately, new Recruitment Directors are easy bait for Recruitment Investors, Invoice Finance companies and Pay & Bill companies so be sure not to sign any long-term contracts before talking to TBOS first, we may just save you from making a costly mistake early on.
You will need jobs boards for listing your job descriptions, here is a list of the most popular job boards in the UK.
SERVICE SUPPLIERS & RESOURCES
With over a decade in the recruitment industry, TBOS has cemented many good working relationships with reputable service suppliers, some of which offer exclusive discounts to our clients.
As a new start up recruitment business you will need to consider service suppliers as well as stay up to date on industry resources, we have listed these for you:
- Creating a company website
There are many options available on the market today for you to create your own website, Wix, WordPress and Squarespace are popular choices. From our experience, it’s better to start your company website with a recruitment-specific web developer, that way your website is built with the correct functionality for your clients and candidates to use from day 1.
- Obtaining a Recruitment Management System
Investing in a good CRM system for your agency will help with managing recruitment tasks, documents and registrations to your agency. Many companies offering this type of service will offer free trials so be sure to give them a go to see which one you prefer. Definitely have a look at ones that are mobile friendly…
- Joining Recruitment Industry Associations
As you are starting out in the industry it may be worth joining an association that aligns with your start up budget. Joining or even following the updates of popular Recruitment bodies will ensure you stay up to date on industry networking opportunities, job board discounts, compliance issues, training and much more. To name a few: TEAM, APSCO, REC
- Recruitment News
Staying up to date on industry news and insights will keep you informed of upcoming trends, compliance issues and recruitment opportunities. The most popular platforms for recruitment news and statistics are: Recruiter, OnRec, Recruitment International, Global Recruiter
Now you have had the complete breakdown of how to start a recruitment business in 2019, we hope you are considering your next steps. The very first being, your company name!
As mentioned previously, TBOS can help you with company formation, introductions on business banking, completing your tax registrations and much more. Not forgetting, there are no fees until you make your first placement.
Start this exciting journey by calling our team today on 0345 646 0402, we’d love to hear from you.