When you’re starting a new temporary recruitment agency, there’s a lot of pressure to succeed quickly. Like any industry, getting through that first year unscathed is brutally tough, and many agencies can still fail after a few years.

With this much pressure on your shoulders, it’s tempting to push beyond your means in a desperate attempt to do well. While there’s nothing wrong with ambition, there are a few pitfalls that recruitment startups often fall into even after that 12-month period.

To give your startup the best chance of success, let us explain what these pitfalls are and what you can do to avoid them.

 

Not Budgeting Correctly

If you’re starting a new agency, you’ll naturally have a budget to work with. This can be purely from your own savings, a loan, or pooled resources from the people who will be part of your team. Getting that budget together is one think, sticking to it is something a lot of agencies struggle with.

That money can disappear fast if you overspend. If you splash out on office space and brand-new PCs but then don’t have enough funds to start paying your temporary workers or have no spare funds for marketing, things can fall apart fast.

Things like CRMs and similar software may seem like expensive investments, but they allow you to hit the ground running and keep that momentum. This is where our service really helps you to pay your temporary workers, and they’ll always be paid on time too!

 

Making your Agency Unsustainable

In a similar vein, it can be tempting to try and expand your team in those early years. If you’re being approached by a number of clients, this is understandable, as you won’t want to let them down. However, if it turns out that this was the result of seasonal demand, you might find yourself with permanent members of staff that aren’t needed.

When this is the case, we always recommend choosing temporary workers to help you through those hectic months. You know better than anyone the value of temporary workers, so why not use them in your own business too?

Scalability is one of the most important words in recruiting. Like we mentioned, an expensive office space can be costly and unnecessary and the same is true for permanent hires. Instead of hiring administrative staff or working with multiple third parties, trust us to handle all the admin for you, for one price.

 

Choosing Clients that Aren’t Right for You

In your first few years as a temporary recruitment agency, you’ll be glad whenever any company contacts you asking for help. A paying client is a paying client, and you’ll rarely turn any away.

However, some of these clients might not suit your agency or match your business goals and could therefore pull you in the wrong direction. Temporary recruitment is a very competitive industry, there are thousands of companies just in the UK, all trying to provide the best temporary workers.

The best way to stand out is by finding a niche. If you only provide temporary workers for the healthcare sector, for example, you can be more selective when filling your database, and relevant clients will approach you as a result.

So instead of trying to cast the widest net possible, see if a more niche approach is best for you. This can be based on the workers and clients you have already or can be a gradual change as you grow.

 

Providing Weak Candidates

Your database is an essential part of your agency. It should therefore be packed with sparkling CVs from the best talent available. The better-quality workers you provide, the happier your clients will be, and your reputation as a reliable provider will grow.

To entice the best temporary workers away from your larger rivals, think about what you can do to sweeten the deal. Something as simple as better communication or asking for feedback once a placement ends can go a long way. Temporary workers are the heart and soul of your agency, make sure they feel that appreciation!

Paying them on time helps a lot too! This makes recruitment funding even more important. But you need to choose the right provider.

 

Investing in Too Many Services

To keep your business sustainable without sacrificing efficiency, most agencies will invest in third party service providers at some point, both in those early years and much later.

This is great on paper; you get the professional help you need to continue working well. However, if these companies start to let you down, they soon become more of a hindrance than a help, and poor budget management only makes the issue worse.

Communication is key with any of these services. If you aren’t being provided with regular updates or can’t get hold of them when you need to, it only adds to the headache. At Back Office, we know that communication is everything and are always contactable if you have any questions.

If you’re paying multiple third parties for different services, one for your invoicing, another for general administration etc., the cost will add up. Instead, choose a company that has all the services you need for one fixed fee (that’s us!).

To go back to budgeting; with one fee to pay, one that won’t suddenly change after 6 months, you can invest the rest of your budget wisely. Upgrade your CRMs, work on your marketing, or simply bring in more temporary workers than ever before, all without worrying about your bottom line.

Cash flow issues are one of the main reasons why recruitment start ups fail. With Back Office Support Services, we’ll help you manage your funds wisely and ensure you always have the money to hand if an invoice is late or a client leaves.

If you have any questions about us or any part of our service, please don’t hesitate to get in touch. We look forward to hearing from you!