How to Start Your Own Recruitment Firm

To start your own recruitment firm, you need to understand the true costs (including your own time), choose a niche and build a brand around it, set up cloud software for accounting, payroll and recruitment, meet your legal and insurance obligations, and then get out and win clients. Planning each of these before you launch makes the early days far less stressful.

If you’ve been in the industry for a while, you know that running a recruitment agency can be both rewarding and lucrative. It’s not exactly a walk in the park, though, particularly at the start. Here are the key areas to work through before you even think about hiring staff:

• Understanding the true costs
• Finding your niche and building your brand
• Setting up your cloud-based software
• Knowing the rules and protecting your business
• Finding your first clients

What does it cost to start a recruitment agency?

Starting a business can be expensive, and many new owners are surprised by how many costs they hadn’t anticipated. Be across all of them, big and small, from office space and insurance to software subscriptions, IT equipment and business development expenses.

One cost many owners forget to factor in is their own time. Your time is valuable, and it’s worth putting a dollar figure on it to understand whether you are using it well. If you spend a lot of time on admin instead of business development, you could be costing the business a significant amount in lost opportunities, so look for a solution from the outset. The right technology, from your accounting software to your CRM/ATS, can do many of these tasks for you at a far lower cost.

When it comes to hiring staff, think about the full cost. On top of salary, you need to cover superannuation, leave entitlements and payroll tax, plus the time (and cost) of training. As a recruiter, you know the value of the right hire and the cost of the wrong one, but when it’s your own business, it’s far more personal.

Software costs vary by provider and team size, so compare what is included rather than just the headline price. Our pricing guide explains how Recruit Wizard approaches pricing.

How do you choose a niche for a new recruitment agency?

With so much competition, it often pays to start with a defined niche or a handful of industries to target. A niche also helps you find your first hires, because you can look for people with skills in your specific field.

Once you know your niche, build a brand identity around it. From your business name to your website, a brand that attracts your target market helps potential clients identify you as the right agency for the job. If you don’t already have a clear vision, consider talking to a brand expert.

Unless you have a background in design, it’s a good idea to outsource your website and logo to an expert. Your website is often the first thing people see when they search for a recruitment firm, so make sure it represents your ethos and services accurately.

What software does a new recruitment agency need?

The right cloud-based software reduces both start-up and ongoing costs, but it pays to know which tools suit your needs. At a minimum you’ll need:

• An accounting solution to manage invoices and payments
• A payroll system for your employees (and contractors, if you place temps)
• A recruitment CRM and ATS to manage candidates, clients, jobs and placements

Investing in a quality CRM and ATS increases efficiency and lets you track and automate communications and workflows from day one. Recruit Wizard is designed specifically for recruiters and brings CRM, applicant tracking, automation, analytics, SMS and email marketing, e-signing and AI into one platform, so a new agency doesn’t need to stitch together a pile of separate tools.

What legal and compliance obligations apply?

When it comes to legislation and regulation, change can feel like the only constant, but as a business owner you need to be across privacy law, work health and safety requirements, labour hire licensing (where it applies) and Fair Work obligations. You’ll also need a code of conduct, a privacy policy and a secure way to store and manage people’s data. To do this, understand the data and privacy legislation that applies in your market, plus the relevant laws in any other country where you do business.

You’ll also need the right insurance, from property cover to public liability and professional indemnity. Many larger organisations and government departments require these to be in place before they will work with you.

How do you win your first recruitment clients?

With the right tools and technology in place, you’re ready to do what you do best: connect with people and do business. It can feel daunting, but starting a business can be incredibly rewarding, and today’s technology can do much of the heavy lifting for you.

Recruit Wizard has helped many start-ups with a locally supported platform designed for recruiters. You can read more about us or book a call with our team to kick-start your business.