Starting new Recruitment Brand - HELP!!!!

[G.johnson3294]

Good Afternoon all,

I am fairly new here and would like some help around setting up a new recruitment brand.
In short I am setting up a brand for a number of Recruitment Consultants to work under, these consultants will be working on commission only (70% of all billings) and I will provide all the required job boards etc for them to do there job.

The idea behind it is simple. I will create a known brand, market it and provide everything for the consultants to essentially work for themselves without all the hassle of doing it. This will only suit a select few people, your go-getters in life!

I will be setting up in serviced offices in London and have a financial backer providing £35,000.

Has anyone got any experience of setting up this kind of business? and are there any tips or help you can give me?

Thank you

George

 

[Red Wood]

Having the financial backing is important, so you have that ticked off. Its a competitive, saturated market, so will be tough to break in, however having a platform for ‘1 man bands’ could prove popular.

Just ensure the system is robust, it is thoroughly tested and offer some free accounts to prospective users to get much needed feedback on your product/service

good luck.

 

[NickGrogan]

George

There are several companies already doing this, and have been for a number of years. Are you offering everything they offer? What makes you different.

Have you worked in recruitment before? Building a brand by advertising will cost a lot, but it won't really help bring any clients or candidates in, probably better to focus on delivery rather than brands.

 

[Ian J]

I will create a known brand, market it and provide everything for the consultants to essentially work for themselves without all the hassle of doing it. This will only suit a select few people, your go-getters in life!

Surely life's go getters would rather go it alone than give you 30% of their income for what initially would be rather spurious benefits leaving you with the "no go getters"

 

[NickGrogan]

30% isn't unusual. Subscriptions to job sites for CV's and ads are not cheap, and dependent on the market this can really add up. Add in finance costs for running contractors, invoicing, factoring, debt collecting and so on and it soon adds up.

Having said that if you get a few recruiters on board £35,000 isn't going to get you through to the first placement being paid, so you'll need more money just for basics, never mind building a brand.

 

[G.johnson3294]

Hi Nick,

Thanks for replying so quick,

There are several companies already doing this, and have been for a number of years. Are you offering everything they offer? What makes you different.

Do you have any examples of these companies? i do know a few myself as I have worked in recruitment for many years at all levels so have been looking at them as case studies.

Another question to ask is, will £35,000 be enough based on 3 consultants and paying them 30 days after the placement starts?

Thanks

 

[NickGrogan]

There are several listed in google if you search for self employed recruitment consultant, plus on the usual recruiter websites.

Short answer, no. Really depends on target market, sales levels, other costs and payment terms.

If I place a high value candidate at a bank - £80k salary @ 25% on 60 day payment terms, you'll be paying me a lot of your initial funding on my first deal, at least 30 if not 60 days before you get paid. Clearly if you have 3 recruiters doing this, your money won't last long.

If you aim at lower value deals, you need more volume, but the problems remain.

 

[G.johnson3294]

Food for thought.
Thanks for your positive responses. Certainly a lot to think about and to iron out before we open our doors - Looking at initially bringing in 3 self employed consultants would be a good place to start.
I am also going to look at extending our line of credit, allowing us more funding before hand, even if it is not used it will be useful in case we need it. After all, most business's fail due to cash flow issues and that is something I don't want!

Thanks again

Any other points would be great

 

[NickGrogan]

2 thoughts come to mind. Firstly and probably most importantly, why you? Why would a recruiter choose to work through you rather than any of your competitors?
Secondly, where are you going to find these recruiters? Many that want to go self employed will already be with your competitors and unlikely to want to switch, it will be harder than you think.

 

[SarahDinnage]

I own a recruitment company as most self employed consultants do. Tbh If your consultants have the get up and go to set up themselves they wont struggle to find jobs to fill and jobs boards will always make themselves known to them. I don't understand why they would want to give you 30% of that - what sort of services would you offer that they couldn't do themselves. If I was paying that amount I would want more than job board posting because with companies like Job Mate/Broadbean it literally takes 2 minutes to post your job to hundreds of boards.

30% doesn't sound a lot when you have to pay for the job boards assuming you are using all the big companies - Reed/Total/Monster/CVL/ you wont walk away without paying a lot per month + job posting services and also I assume yourself as well as some form of database for 3 people if you are all working to the same system.

What happens If you charge 30% of the invoice value and the candidate drops out? Who picks up the cost if the consultant folds/cant pay? The job boards will still need to be paid?

For me - I would just cut out the middle man and do it all myself rather than pay you 30% for jobs board and database access but if I was a lone self employed consultant I might consider it if you were acting as a support service answering my phones, doing accounts, credit control, passive database searching and clensing my data, supporting marketing - basically all the things I'd rather not be doing. I'm still not sure about 30% of each placement but if you were offering enough of a service then it could be worth it.

Its' got the bones of an idea but I think you need to tell us more about what you would offer.