How to Start a Staffing Agency

Looking for how to start a staffing agency? Then this article will help you guide on starting a successful starting a staffing agency.

How to Start a Staffing Agency

To face the giants of the sector (unless you want to join them and become a franchisee), you will need to know how to make a difference.

The first expectation, for recruiters as for candidates, is to have in front of them a professional, and if possible a specialist in their sector who will better understand their expectations. Thus, if a candidate is looking for work in the catering sector, the ideal is that he is dealing with a former restaurateur.

For you who set up your recruitment agency, this means that to make the difference, you probably have an interest in specializing in a sector that you know well. You will thus be perceived as an expert in the sector and will have an advantage over large groups, which are generally generalists.

Note that it is first of all the industry which is aimed at recruitment agencies (40%), then the tertiary sector (35%), and the construction industry (25%).

In what type of offices should you Start a Staffing Agency?

The choice of a small commercial space will usually suffice to set up your own practice. But more than the size, think about the location.

So, for the opening of an independent recruitment agency, it may be interesting to settle:

  • In the city centre so that you can easily set up meetings with recruiters or candidates
  • In a co-working space or a business centre: these hubs attract many professionals and a location in this type of space can allow you to easily meet candidates or potential customers
  • Near the offices of your target customers, or a pool of candidates

Obviously, you will have to think about studying the locations of your competitors. There will probably already be a sign of large temporary workgroups in your city, these being present everywhere in France.

If you specialize in a sector where there are many candidates in relation to the number of assignments entrusted by recruiters, you can consider settling near your competitors in order to attract a maximum of candidates. Conversely, if you are in a sector where candidates are scarce, you will probably have an interest in moving away from your competitors, in order to protect your access to candidates from competitors.

You can also choose to take over an existing recruitment agency. In this case, find out the reasons for the sale by the former owner. In particular, ask yourself if there has been no recent installation by competitors.

What legal form to Start a Staffing Agency?

When creating a recruitment firm, you will have to make a choice regarding the legal status of your company.

Several options are available to you: you can notably opt for a form of a sole proprietorship or for a company like SARL or SAS. You can find more information on the different possible legal statuses in our guide.

The material and human needs necessary to Start a Staffing Agency

The material needed to open a recruitment agency is quite limited. In addition to the equipment of the commercial premises, you will need computer equipment (computer, printer), office equipment, a telephone, and possibly a professional vehicle to go to meetings with your customers, as well as a website to post your job offers and collect CVs.

In terms of charges, apart from administrative costs (chartered accountant, insurance, rent and maintenance of the premises, bank charges, etc.) and personnel costs, the main item of expenditure concerns prospecting, in particular the costs associated with recovery CVs. These are sometimes overlooked for people setting up a recruitment firm. However, they constitute a considerable expense item.

Regarding staff, your employees must have specific qualifications for the performance of a service, including:

  • Good interpersonal skills, whether with recruiters or candidates
  • Good business sense, if you entrust them with customer prospecting
  • Good knowledge of the recruitment processes and the trades of the sector
  • Ideally contacts in the sector, candidates or potential customers

Start a Staffing Agency: what marketing plan?

Your marketing plan should cover both prospecting for recruiters and sourcing candidates.

Regarding the search for mandates, the ideal is to have a portfolio of potential clients before you even start, but you can also consider the following actions:

  • Make use of your professional network: if you are hired in a company, talk around you about your desire to create a recruitment firm before resigning, reconnect with former colleagues, customers or suppliers to see if they have needs or can put you in touch.
  • Canvass businesses in your region by phone, email, or mail
  • Organize conferences or lead a networking group on the topic of recruitment
  • Communicate on the internet: advertising on keywords related to recruitment, creation of white papers, webinars, etc.

Regarding CV sourcing, your marketing plan can include the following actions:

  • Posting of advertisements on job sites
  • Prospecting on LinkedIn
  • Prospecting with schools and universities in the region
  • Animation of workshops on the theme of employment
  • Establishment of partnerships, with the Pôle Emploi branch in your city for example

Write the business plan of a recruitment agency

The business plan is a document used to present your business creation project to banks and investors in order to obtain financing.

It is also a useful document for the business manager, since it allows him to ensure the financial viability of his project before launching, and subsequently serves as a benchmark for the implementation of the project.

Schematically, the business plan of a recruitment firm has two parts:

  • A financial forecast highlighting the project’s financing plan and its medium-term profitability potential
  • A written section highlighting the strengths of the project and the risks associated with its implementation

If you have never written a business plan, a good way to easily carry out this exercise is to use online business plan software.

Using professional software has several advantages:

  • You are accompanied in the writing by instructions and example for each part of the plan
  • You can consult examples of written business plans
  • You easily realize your financial forecast, without having to worry about the accounting aspects which are automatically taken into account by the software
  • You get a professional document, formatted, and ready to send to your banker

Find the necessary funding to open a recruitment agency

To finance the launch of your recruitment agency, you may need to find funds.

To do this, you have several options: seek bank financing, obtain a financial lease for professional vehicles or rent them in LLD, ask to benefit from the aid for business creation offered by the government, etc.

Is it a Good Time to Start a Staffing Agency

The market for those who are called “headhunters”, that is to say, recruitment agencies are in full recovery.

After several difficult years, for the sector in general, the worst seems to be over. the turnover of the sector had dropped by 25% in 2009. But the situation is gradually recovering: + 2% in 2014, + 3% expected in 2015. It would, therefore, seem that this is the right time to set up a recruitment agency.

If the market for recruiting firms starts again, this one is also more and more competitive, and more and more crushed by the three big groups: Adecco, Randstad, and Manpower. France has around 1,300 recruitment firms, but these three big names alone dominate two-thirds of the market.

And the competitive pressure imposed by these recruiting giants is likely to increase. For people who embark on the adventure, it will, therefore, be necessary to demonstrate innovation and know-how, and above all to find a way to differentiate yourself.

Before committing, it is therefore essential to carry out a thorough market study, and to study in detail the offers of the recruitment firms already present in your region.

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