No matter how confident a person you may be and the number of good contacts you have established over the years, making the step to leave salaried employment to set up your own business is daunting. You cannot live on promises and there is no guarantee that those contacts can actually provide you with business. You can hope, but you really need more than that. You certainly need a good business plan and a realistic idea of the turnover you can create and the costs involved in creating that turnover. You also need some basics in place.
Starting a recruitment agency from scratch
Establish a name and legal status
Once you decide it is time to move on to working for yourself, you will need to put some basic things in place before actually launching. Many of them are obvious because you have to create an identifiable entity and register with statutory authorities.
You need to decide whether to set up a limited company or not. In the event that you do, you will perhaps look to buy a company ‘off the shelf’ and register the shareholding. You can of course be a sole trade or a partnership as alternatives.
You must have a name of course though an ‘off the shelf’ company comes with one already. You can get too wound up in a name. How many well known company names are instantly recognisable yet don’t seem particularly special?
You must have a good Internet presence so your domain name does need some thought. Once you have bought that you need to get your email accounts and contact details organised.
VAT and PAYE registration must be in place before you launch and this is entering the area of finance which is crucial in any business.
Business plan and funding
Your business plan must have looked at funding. You need enough for your start up costs and to pay your bills until you begin to generate income, for the company and for yourself via a salary. If you are going into the recruitment business it is particularly important as you may be paying your workers while waiting for your clients to pay you. The solution to that can be using a factoring company that can advance you the money and perform the credit control function to get the money from your clients.
Your bank and insurance company will want to see your documents as you set up necessary accounts.
You have to get the office organised in terms of the lease, equipment and hardware, stationery and furniture. If you intend meeting the public and clients there, then you need to have a good location.
After that, it is all about generating the business and making best use of your time. That could well involve you outsourcing some functions to experienced specialists that can demonstrate their reliability.
Starting a recruitment agency may be a little daunting, then again branching out in any sector can be a little nerve racking. If you put the basics in place, and ensure that your business plan covers potential problems by including the factoring costs, you have every chance of success.
KW starting a recruitment agency
Image attributed to renjith krishnan