The UK temporary recruitment agency market, worth £36 billion, is the second largest in the world — is there any better place to start your own recruitment business?
However, starting a new business is never easy, and with close to 8,500 new recruitment agencies registered every year, you’re not alone trying to enjoy a slice of this gigantic pie!
This article explores what you can do to stand out in a crowded agency market, the tactics you can follow to market your agency successfully to both clients and candidates, and last but not least, how to reduce your administrative burden to spend more time on the activities that bring you most value.
Know your strengths and differentiate yourself
With close to 40,000 recruitment agencies in the UK for clients and candidates to choose from, it’s important for you to determine what you want to focus on to start with, and also what you want to achieve longer term.
Think about your experience to date, your existing network and your strengths.
Do you prefer to focus on permanent or temporary placements?
To succeed with temporary placements, you need to focus on volume and speed with clients who have typically very immediate needs. This can be quite stressful, especially if a candidate doesn’t turn up on the day (s)he was supposed to. On the flip side, you know incredibly fast if you’ve won (or lost!) a placement, and it can bring regular cashflows. Permanent placements occur less fast. You might expend considerable effort for a long period of time without any results, but once you place a candidate, your return can be really high. Deciding on one or the other should be driven by your personality and what you enjoy doing.
Do you want to be a generalist recruiter, serving all clients’ needs, or focus on a niche (e.g. asbestos workers, nationwide)?
This is often determined by your experience to date, your existing network and where you’re planning to start your business from. If you’re starting in a very large city (think London, Birmingham, Liverpool etc…), it is preferable to focus on one sector to stand out (e.g. construction, or legal — white collar). If you’re launching in a smaller location, becoming a generalist can help you cater for all the needs of the clients in your local area.
In your decision making process, it’s also important to take into account wider industrial and political trends. Looking at the monthly data from the REC Report on Jobs can also be a great way to help you answer these questions. It highlights which sectors, geographies and type of placements (temp vs. perm) perform better.
Marketing. But to whom?
Marketing is the bête noire of any startup, as it is both expensive and frighteningly difficult to get right; an art, not a science. Cost per click, organic content, digital marketing, outdoor advertising, PR, trade shows, career fairs, networking… the list goes on.
A challenge that is specific to the recruitment industry is the tripartite relationship between you, your candidates, and your clients. You’ll need to think closely about the dynamics of the market you’re focusing on and adapt your marketing tactics accordingly — is it a candidate-poor market (i.e. are candidates hard to find, and therefore it will be relatively easy for you to find clients) or the opposite?
Overall, my advice to new business owners in recruitment would be the same as to those in any other sector: employ data, data, and more data. Run A/B campaigns with everything from straplines to remarketing emails, and use this evidence to guide your future campaigns. It’s not all a stab in the dark, provided you are prepared to put serious thought into reaching your target audience and getting your specific value propositions across.
Once again, start local and niche, in a specific sector and location for example, and leverage your existing network. It makes it easier for you to build relationships and get known, and the process can be far more cost-effective if you’re using Google advertising, for instance.
To expand your client database, you can now complement these business development efforts by registering on recruitment marketplaces — these are online platforms connecting companies looking to hire staff with recruitment agencies. TempaGoGo is one of those, focused on temporary recruitment, while Hiring-Hub focuses on permanent recruitment.
Similarly, a number of agencies I know use gig platforms to source their temporary candidates. For permanent placements, LinkedIn is an absolute gold mine!
Take your back office seriously to maximise time spent on value-adding activities
Ensuring that you’ve optimised your back office is a real differentiating factor. All the time you don’t spend on administrative tasks (e.g. inputing data from faxed timesheets, chasing unpaid invoices…), you can spend winning new clients or sourcing great candidates for more successful placements.
Having slick operations is also a great way to wow your clients and encourage repeat business.
You can decide to manage your back-office operations yourself, and they are many software providers out there that can offer turn-key options from website design, to candidate booking and timesheet management, invoice, payroll and even factoring functionalities.
The other option is to outsource your back-office to third party suppliers (and once again, there are many out there that will quickly call you to offer you their services!) when you start. This option can be cost-effective, particularly at the start of your recruitment journey.
Before committing to a supplier, ask for advice! LinkedIn is once again a superb resource for recruiters who are often very keen to share their experiences.
This article was first published on UK Recruiter.