Thinking About Starting a Recruiting Business?
If you want to start your own recruiting agency there are a few things you need to think about. Contrary to what a recruiter mentioned to me recently, there is a little more to this than buying a box of business cards.
There are many forms your business can take on. Some agencies only offer perm placement on a contingency basis. Others provide executive search and ask for up front retainers. Still others provide contractors for temporary assignments. What are you going to focus on? What is your geographical coverage area, what is your niche staffing market expertise?
You will need to think about getting signed fee agreements, recruiting top candidates, job board advertising, resume databases, applicant tracking systems (ATS), billing & collections, contracts, agreements, training, etc. When you work for a large agency all of this is provided for you. When you hang your own shingle you are on your own to figure things out. And the costs can get steeper than many people imagine.
One option is to join a network of recruiters. Many have tried, some have done well, and some have not. Think about it, what do you need to insure your success? Do you want to build equity in your new business by being able to generate a recurring revenue stream by offering contract placement services? An average IT contractor for example can generate $20/hr in profit, that’s over $40,000 for a one-year contract. You will need to pay your contractor weekly, have workers comp insurance, file taxes…Having a partner in your recruiting network to handle this for you can be a huge asset.
Have no doubts, even a small agency consisting of you and only you can be a very profitable enterprise. At an agency many perm people can bill $200K/yr and earn about half or 50%of what they bring in. The agency covers your phone bill, provides you with an office, health insurance, a computer, a manager, a receptionist, a coffee machine, occasional training, support, a daily commute, and more. On your own you can keep the $200K and cover your own expenses..pretty tempting for sure!
The market is heating up and there’s no time like the present to launch your own business. Be sure to make a list of your options, your costs and your required bank roll before you start. And maybe splurge on a really good coffee machine for your office.
By: Andrew Stock of Hireability.
HireAbility Connects the World’s Recruiters and Parses the World’s Resumes
Article courtesy of the Recruiting Blogswap, a content exchange service sponsored by CollegeRecruiter.com, a leading site for college students looking for internships and recent graduates searching entry-level jobs and other career opportunities.
