If you are planning to start a recruiting practice and need investment, it is likely that a business plan will be needed. Pro Business Plans has worked with dozens of recruiters to create professional plans for investment and strategy. This article outlines what is typically included in the plan and how it is to be structured.
There are several things to consider when starting a recruiting business that will directly impact the success of your company and the way investors perceive you. Such factors include the region of focus, industry or company size of focus, and background of the management team. The existing network of the management team plays a large role when determining the success of a recruiting business. However, strategic marketing campaigns and a talented team can help to acquire clients and convert them into loyal customers. These factors are reflected in business model and shape the future marketing strategy as outlined in the subsequent sections.
The business model of a recruiting company will depend upon several factors. Some recruiting firms represent a large number of clients for working class and entry level jobs in industrial communities, such as Manpower. Other recruiting companies may focus on an elite niche of headhunting executives or legal professionals. The success of each business model may be equally profitable, but will depend upon the market saturation and demand for your specific location. A professional headhunting company in a predominately blue collar community may have little competition, but also face restricted demand. Investors will seek to understand how your investment company compares to others in the industry and how you will acquire competitive positioning.
Perhaps one of the most important areas of a business plan for a recruiting company is the marketing section. This will outline how your company will acquire clients and source a targeted list of prospective candidates. The unique approach to the marketing plan will depend on the nature of your recruiting firm. For instance, a company sourcing highly technical candidates may search on LinkedIn and represent a list of technology firms. Aside from posting online job listings, they may develop unique approaches and sales tactics to source a competitive candidate pool. Developing an established reputation for sourcing quality candidates will help to grow a referral base that will make personal selling more effective.
If you are seeking investment capital for your recruiting business plan, it is likely that you will need to include three to five years of financial projections. This may be computed in the form of an income statement, cash flow projections, and balance sheet. Creating a detailed financial model will help you to not only budget for expenses, but also determine a pricing strategy and identify key risk areas. When requesting money for a new recruiting company, a popular amount is to acquire the initial Startup capital in addition to the first three months of expenses. Since the first three months will be a risky period, you do not want to have cash flow concerns while you are attempting to place your first round of candidates.
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