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Starting a Recruiting Business

written by: Margi Williams•edited by: Michele McDonough•updated: 4/1/2010

A startup recruiting business requires experience in recruitment, sales, and marketing. This article provides an outline of the skills necessary to successfully manage a recruiting agency, both locally and nationally.

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    Introduction

    A contract recruiter provides search and placement services to employers with unique hiring needs. Traditionally, these employers contract professionals to identify candidates with specific educational backgrounds and experience for very specialized opportunities. Often, these positions are difficult to fill using traditional job search techniques. A contract recruiter can be hired on retainer, on contingency, or compensated using a combination of the two depending on the services they provide and their client's billing preferences. A contracted recruiting professional does not work exclusively with one particular employer, but instead, works with several clients at any given time with the understanding that if their referred candidate is placed, they will be paid a fee, typically 15% to 30% of the position's total compensation package.

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    Establishing a Local Presence

    If you intend to launch your business locally, you will need to establish a local business presence to effectively and immediately market your services. Consequently, you should leverage the power of your existing networks to share the benefits of your new business venture. To this end, reach out to previous employers, nonprofit groups, professional associations, and colleagues to market the services you provide. Additionally, take advantage of any networking events hosted by your local chamber of commerce and other business groups to promote the benefits of your recruiting service. Of course, you should also create a business development plan that effectively markets your services to existing businesses in your targeted market. Finally, it will be important for you to connect with college representatives in your area and develop a formal recruiting process specifically designed for college graduates.

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    Getting Started

    To successfully start a recruiting business, or search and placement service, you will need to first determine the geographic area you will target. In the recruiting industry, because of technological advancements and the recent explosion of social media, recruiting professionals are able to establish themselves locally, regionally, or even nationally. Depending on your chosen niche, it may make more sense for you to target your local community or alternatively, broaden your reach based on employment trends in a specific profession. For example, qualified nursing staff are being heavily recruited nationwide and a large number of recruiters have found huge success generating a national client base to meet this need.

    Second, you must identify your competitors and assess their specific specialty areas. Evaluating your competitors' strengths and weaknesses will allow you to identify any gaps there may be in your chosen field to ensure you target a professional niche that will benefit from your services. Additionally, it is advantageous to recruit in an area you have some level of professional acumen as this is often a great selling point for both potential clients as well as candidates. For example, a doctor's office in need of nursing staff may be more inclined to grant you their business if you can prove some level of expertise in the nursing field or general medical staffing experience. Candidates, in particular, are more inclined to entrust recruiting professionals who have direct experience in their specific area of expertise.