To be able to achieve success in a recruitment business, it is not just another recruitment agency that takes in many job orders, focusing on many industries and job functions.
You need to be specialised.
Yes, you might be seeing some recruitment agencies that are doing these and make money but you may not know the real stories of why there are successful in their recruitment business.
In the recruitment business, there are 8 important factors you need to cover to ensure success:
1) Mind Your Running Cost
This is very important because you can have good sales and income from selling your recruitment services, but if you are not able to control your costs, all the money you are earning will go back to other expenses instead of being profit.
Even recruitment millionaires will be broke if they do not mind their running cost.
Spend less money on high-end computers or laptops, a basic one will be more than sufficient, there is also no need to purchase a MacBook or a laptop that cost thousands of dollars. A laptop that is less than $1000 will be more than sufficient.
There is also not necessary to invest your money in recruitment software or cloud based candidate management software, it is all a waste of money at this point of time if you are starting off, keep your money in your bank account, not putting the money to other peoples bank account. Even if you are already running an established recruitment agency, you should not be investing in recruitment software too, why so will leave it to another topic.
2) The Revenue
Focus on at least 80% of the time to generate revenue.
Of course, this will be the key factor to determining whether your company will make it or not. Without good and constant revenue, you will not be able to cover your rent, salary, and other monthly expenses in the recruitment business.
Aim to have your revenue double your monthly cost, in this way, you will be pretty such that you will have a surplus every month and save it for seasons that is low in closure rates.
Ideally, you should be looking at 5:1 ratio, meaning your total revenue per month ought to be 5 time your monthly running cost.
3) The USP
I asked many students these questions:
- Why should the potential client want to give you their job orders?
- Why are you so special that they should part with their money to give you the job orders exclusively?
- Why wonder candidates needs to send you their resume compared to other bigger and branded recruitment agencies?
Some of the answers I got friend the recruitment business owners is that they are able to provide better and quality services, they are able to provide a better price, they are able to provide a longer credit terms.
Let me ask you, is there anything special about that? No, your recruitment competitors are able to do the same thing as you, as long as they are able to copy and yet give a better values and prices, you will not have an edge it the industry, you will be pervieved as one of the other recuritment agency.
Ask yourself this question honestly, why the potential clients have to give you the job order.
Try to come up with at least three to five good answers to it.
If you cannot find ONE good answer, most likely you should not be even engaging in the recruitment business at all.
4) The Pricing
Putting too much effort on lower pricing will eventually doom your company. It is always better to put your effort on higher ticket items because often, the time you put in will be about the same anyway.
Always make an effort to be innovative and create something new instead of just following what others are doing. A follower will always lag behind the creator. Because of this, the financial reward will usually not be very interesting.
6) Read and Research
You need to read and research a lot on your industry, your product, and your services. Know your competitors and know what they are doing. Knowledge is always good to have when you are talking to clients, because it can get quite embarrassing if you are trying to sell to clients and you don’t know what you are talking about.
7) Be an Expert
Reading and doing research as mentioned above is great, but if you want to go to another level, you will need to become an expert in your field. It is just like when I became an expert in recruitment business. I did the research extensively, tested them out again and again, modified them, and retested again and again to see the results. I even know who are the competitors for my the recruitment business industry that is coaching and training recuruitment business owners such as recruitmentcoach.com, Greg Savage, Roy Ripper, Davidson Gray and others.
That is the amount of work you need to do to become the guru or expert in that area.
People are always willing to pay top dollar for an expert or a guru. That is where I make most of the money—by being the expert and teaching people the core tips and tricks. People are more willing to pay an expert, rather than just another “somebody.”
Be the EXPERT.
8) Be Involved In an Industry That Has Less Competition – If you are in an industry where there are 10,000 companies compared to another industry where there are only 1,000 companies (Assuming the dollar value and market value are the same) the chances of you having more sales in the sector of the 1,000 companies will be better. Hence, choose your industry carefully. If you are in the wrong industry, no matter how hard you work, you will not be very fruitful.
To achieve success in business, a lot of work needs to be done, and the back-end effort is tedious and large. Do not expect instant success. There are ways to make the route shorter by using technology and other platforms to get things done easier, but you still need to make the effort….