How To Start A Recruitment Business

How to start a recruitment business? Here 5 steps to getting your recruitment agency or headhunting business up and running:

1. Define your market/niche

Are you starting a recruitment business for a specific market or niche (e.g. SAP, legal management position or account) or for general recruitment (cover all fields and sectors)?

Are you limiting your headhunting business to local talents, or will go the extra miles to include foreigners or expatriates?

Defining your recruitment market is the first step towards establishing the framework of your overall operation.

2. Iron out all the legal requirements

Get in touch with the HR Ministry and discuss about all the requirements needed to fulfill by your end. Find out any licensing (and fees), if any, that you need to get your business kicking off. Depending on which region, country or state you’re in, the requirements, fees and legal obligations might differ. Make sure you get all things right. The company registration, premise set up, council permit, documentations and so on must be completed before you start your very first day of operation.

3. Establish how you operate

What would be your blueprint of recruitment flow? How do you get a recruiting assignment? Will you be doing it yourself, or assign a sales personnel for it? How do you conduct interview and find out which candidate would be suitable for a certain position? Where would you be conducting the interview? Hotels? Restaurants? Your own office? Think of the cost associated with each, and find out which one works best for you.

What are your terms and conditions? Will you be charging the fees to the client on contingency basis (which means you do the job first and only get paid upon successful hiring), or retainer basis (you’d require some fees regardless the search is successful or not. Not advisable for a start-up, but useful for future, once your business has grown)? How much you’re charging your clients? All these must be properly documented and should always be at your disposal whenever requested by the client.

4. Strategize how you’d grow

A recruitment company can start as small as a one-man operation, but once your business hits the growth path, then it’s time to add the extra hands and use the power of leverage. How do you see your business grow? Will you be expanding into other job territory or market? Or would you grow vertically by maintaining similar area but hire more staff to do the administrative work? Think how you can maximize profits and reduce costs.

How’d you continue to penetrate the market and establish your company as a recruiter of choice? What are your strategies to add the volume of your talent base? How would you source for candidates and recruit people? Networking? Websites? Blogging? Newspaper? Radio advertising? Yellow pages?

5. Make your first call

Don’t waste much time and start making calls to prospective clients and candidates. Get your first assignment and conduct your first interview. In an increasingly competitive recruitment industry, fun awaits you.

9 Replies to “How To Start A Recruitment Business”

  1. I just stumbled upon your blog and found this post really interesting, I would love to start my own business I just don’t know what in just yet but the tips and advice that you have talked about will come in very useful and will have to come back for more advice. Thanks on a great post.

  2. Haha, Zul. Good on you to blog abt tis topic.

    Well, since i do hv some exp in this, let me also add a few thots for the benefit of everyone that read tis post.

    Pt. 2 is most important. In Malaysia, you need to get a JTK license and it has to be renewed on yearly basis. Many are tempted to start the recruitment biz without a proper license but a huge mistake if you plan to expand later.

    But I wud advise people who are keen to get into tis biz to work in a recruitment agency first – Have a taste of what it’s like before starting out as a biz initiative. A word of caution – like any biz, patience is key.

    It’s one of the easiest biz to start out as you dun need huge initial funding and yes, it can be a lot of fun if you have no problem talking to strangers and good in breaking the ice to make people comfortable with you immediately…:)

    1. great info regard to JTK. recruitment agency is similiar to headhunting biz i suppose. interesting field in talent sourcing. thinking of starting one headhunting agency. any advice?

      regards, Michael

  3. Very useful info, especially on the JTK license. I suppose it is not quite feasible to run a start-up exec search firm here in M’sia, given the minimum paid-up capital required for the license is RM50k, right?

  4. I am in the house maid recruitment business and welcome anyone interested to try out this line. You may emial me at above mail. Thanks.

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