WHAT DO I NEED TO GET STARTED?
Checklist for startup agencies
Starting a new recruitment business can be both exciting and challenging. Many recruiters are reluctant to set up their own business, not because it’s difficult, but because they are unsure of the steps.
Here is our checklist of the steps you will need to consider when setting up your own agency.
Know your target market and how to reach them
Write a business plan that enables you to reach and be successful in that target market. You can’t decide on your marketing strategy and planning until you have a robust business plan with measurable goals. This could include sales growth, number of new clients and candidates, referrals and fees. Then break down those goals into quarterly and monthly targets and use your CRM to monitor progress.
Choose a name for your new business
Make sure the name you choose is legal, available (easily checked on Companies House) and has longevity. You might be starting out specialising in legal recruitment, but you might want to expand later, so calling your business ‘recruitlegal’ might not be a good choice. Your business name needs to reflect your brand and the market you are targeting. Finally, remember to check whether the name has any detrimental meaning in other languages.
Choose an accountant who understands the recruitment sector
Engaging the right accountant at an early stage will make the most of your time and resources. Many mainstream accountants often lack depth in recruitment experience or specialist technical expertise to help with anything other than your annual accounts.
Your accountant will help you choose an accountancy plan that suits your changing requirements and appropriate accountancy software.
Consider the partner status of the accountant with major software providers so they are able to provide expert training and advice on add on software.
Registering your business
Your accountant will register (incorporate) your business (limited company) through Companies House quickly and easily.
Set up a business bank account
You will need to have a number of documents to hand such as personal identification (as a company director), proof of address plus your company registration documents.
Set up Ts & Cs and contracts
Creating your terms and conditions is an important step when starting up a recruitment business to avoid non-payment and liability issues. It is not advisable to copy another agency’s as they might not adequately protect your business from liability or reduce risks, so seek professional advice.
Choose a CRM
Selecting a good CRM is critical and should be in line with your business objectives to create competitive advantage. A CRM will increase your efficiency and means you can spend more time selling and less on admin. The right CRM will be able to create reports that help you constantly measure your activity against business plan objectives, allowing you to quickly make changes when something isn’t working, or do more of what is!
Arrange business insurance
If you are placing contractors, it’s very important that your business has the same insurance as the contractors themselves so that liability can be cascaded. You’ll need to consider:
- Professional Indemnity insurance
- Employers’ Liability insurance
- Public Liability insurance
- Cyber and data risks insurance
Write a marketing plan
Your marketing plan should be informed by your business plan. A marketing plan needs to outline your business’s marketing effort.
It is a roadmap that outlines how you will implement your marketing strategy to achieve business goals and targets. It should use a mixture of resources to achieve business objectives including sales targets or customer acquisition.
Consider how much time you have available and your budget carefully when writing your marketing plan. Spend wisely.
Your startup marketing plan would likely include:
- Building a website.
- Social media strategy you can realistically resource.
- Advertising plan that fits your budget.
- Branding strategy (including visual branding).
- Systems for monitoring competitors.
- Pricing plan.
Keeping your eye on and knowing your target customer is the single most important job of any marketer, and it’s never ending!
Your CRM will help with reporting that will measure marketing success, so you will learn where to spend your budget wisely.
Know your legal requirements
Here are some of the key requirements we recommend you get to grips with:
- HMRC requires all UK firms to report on all payments made, in relation to the supply of staff, where they don’t deduct employment taxes and NI at source. The income tax (pay as you earn) (amendment No. 2) regulations 2015 UK.
- Agency Worker Regulations (AWR) are designed to stop the discrimination against people who work for employment agencies, this regulation states that agency workers should be treated no less favourably than their permanent counterparts and covers things such as pay rates, working time and benefits.
- UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (CAP Code) is the rule book for non-broadcast advertisements, sales promotions and direct marketing communications (marketing communications). This code ensures every job ad you post represents a real job and is fair and non-discriminatory.
- The General Data Protection Regulation (GDPR) is a legal framework that sets guidelines for the collection and processing of personal information from individuals who live in the European Union (EU).
- The Equality Act 2010 combines the Sex Discrimination Act, Race Relations Act and the Disability Discrimination Act into a single Act and is basically designed to ensure people are treated fairly.
- Your accountant will help you understand your responsibilities to HMRC as a company director such as tax returns, claiming expenses, payroll and VAT returns.
Do you need a factoring service?
In the temporary recruitment sector factoring is an effective solution to ensure that your business has the available funds each week to make payment to the workers you have placed.
We can help guide you through these steps
AgencyAccountant.co.uk understands your journey if you are starting up a new recruitment business. We can help you put the right partnership relationships in place that you need to succeed.
Whether it’s insurance, CRM software or staff incentive schemes, we can guide and introduce you to appropriate specialists to build your recruitment business.