I’ve spoken to a lot of small recruitment business owners over the years, working as a N.E.D. and advisor in the recruitment industry. As you’d expect, a lot of them are experiencing similar frustrations:
“I know we offer a great service, but lots of employers just won’t give us a chance”
“I want to grow my business. I just can’t get past the 10/20-person barrier”
“I’m highly motivated, but I just can’t get the right people!”
“I’m so busy servicing clients, I don’t have any time to spend with an advisor”
“I just can’t afford to spend money on professional advice”
“I’ve got a 10-year plan. What is it? To work my balls off for 10 years and then retire!”
If that’s the sort of thing you say, even to yourself, then I’ve got news for you…
It won’t happen until you start to do things differently.
Are you really an entrepreneur who is going to grow a successful business? OR are you a recruitment consultant who fancies maxing out on the dividends each year and having your name above the door?
Here are some of the key questions I ask small recruitment firms to separate lifestyle businesses from the ones that could grow into something substantial. Let me be very clear – there’s nothing wrong with running a lifestyle business – it can be very satisfying. But if you really want to build something, a different approach is essential:
Other than office space, core technology, advertising jobs and staff costs, have you invested more than £5,000 back into your business in the last year? This can include business consultancy, branding and marketing, training (other than foundation level).
If you have set up a business in the same sector you have always worked in, can you quantify what specifically you have done to improve the offering for candidates and clients?
Have you got hard, quantitative evidence about your target market that proves you perform better than your competitors (I’m not talking anecdotal evidence or hearsay)?
Have you got a clear, structured, detailed business plan that covers the next three years? Do your team know about it and refer to it regularly?
Do you know where 40% of your forecast fees are coming from for the next 6 months? (That is, can you name the clients who will be paying you fees and giving you assignments, based on actual market intelligence?)
Do you have a candidate attraction/engagement strategy that matches the client requirements? Does it provide a predictable flow of new candidates?
Do you have managers- or potential managers- who are capable of achieving the business plan?
Do you have a strategy to keep these key people engaged? (This may include equity, training and development, or a clear promotional path, for instance)
Do you have the finance in place that you need? Or are you taking steps to position yourself for it?
Do you work minimum 40 hours in or on the business per week consistently? Or do you take more than 2 hours out per week for personal matters (other than a scheduled holiday)?
Are you sure your business is compliant? (Eg. Do you know your workers are on the right type of contract? Are you ready for GDPR? Are you 100% confident that your consultants always follow procedures?)
Are you 100% confident that all your consultants are applying all of the appropriate processes (eg. Are they fully using the CRM, or running their desk from LinkedIN?)? Are they working on the right targets, with the right clients and candidates? Asking the right questions? Recording and using the data?
Be really honest with yourself. If your answer to most of these is “No” or “Not sure”, then I recommend you examine your motivations again. If you want the growth and results that some top businesses achieve, you need to invest in your business, and yourself.
Alison Humphries is a highly experienced MD and NED, with 35 years at the top of the recruitment sector.
She advises directors and owners of recruitment businesses on strategy, finance, sales and management to maximise performance, enter new markets, prepare for sale and work more efficiently.
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