Preparing a Business Plan for a Job Recruitment Agency
A good business plan forms the foundation of the business's success. Read on for tips and strategies to prepare a business plan for a job recruitment agency.
Vision and Strategy
The first step in creating an effective business plan for any business requires having a vision and articulating the vision into a coherent strategy. The business strategy is the nucleus around which the business plan develops.
A vision is a statement of what the organization intends to become and achieve in the future, and strategy is the summary of how the organization intents to achieve this vision. The strategy guides the proposed business activity, provides focus on the day-to-day operations, and lists the unique features of the business that distinguish it from competitors.
A job recruitment agency can have a vision in terms of the range of services it aspires to have, the geographical spread of its operations, and other specific characteristics. A sample vision statement reads, “To be the leading provider of skilled manpower in the continental United States within a 10-year period." The strategy then lists ways to achieve such a vision, such as how the organization plans to do things differently compared to other job recruitment agencies, how the organization plans to approach and persuade employers to source from them, how the organization plans to tap talent for its clients, and the like. The strategy lists how the organization plans to do these things differently from competitors to gain an advantage over them and reach the top.
Image Credit: flickr.com/Ivan Walsh
Goals and Objectives
Having fixed the vision and strategy, the business plan for your job recruitment agency needs to plunge into the details of your business such as evaluating various markets, studying market segments, and sizing up competition to set up short-term goals and objectives. Examples of short-term objectives include "meeting 100 employers in Texas and making a presentation to persuade them to source candidates from us" and “conducting presentations in 100 colleges to include fresh graduates in our candidate database."
Any good business plan requires a comprehensive section on financial details and budget. The budgeting components of a business plan include:
- Capital expenses such as costs to set up an office, website-related costs, initial marketing costs, and additional necessities.
- Recurring expenses such as traveling expenses, salaries, and others.
- Projected cash flow statements.
Long-term and short-term assets and liabilities.
Setting up a recruitment agency requires investing money with no prospects for returns in the short term. The business is likely to face cash flow constraints in the initial days of operations, and as such a good budget plan needs to include operational or recurring expenses for the first six months in the start-up capital costs.
The budgeting exercise should also make explicit the expected reward of carrying out business operations for the entrepreneur and other stakeholders in clear quantifiable terms.
Customers and Competition
Two major mistakes most businesses make are underestimating customers and competition. A good business plan does not assume what the customer wants and does not ignore or consider competitors seriously. The best approach is to research the market thoroughly; analyze how competitors approach their customers in terms of services offered, pricing, and other parameters to evaluate whether the customers are happy with the mix; and scope for improvements existing either in terms of new services or providing existing services in a better way.
A new job recruitment agency can, for instance, think in terms of offering flexible staffing options as a new service that competitors do not provide, or try to improve over the depth of services other competitors provide by offering a free replacement if a candidate quits within the first six months.
A business plan is not about eliminating or avoiding risk, but undertaking a proper risk assessment and instituting sound risk management methods.
Effective risk analysis and management of the job recruitment agency requires undertaking a SWOT analysis with emphasis on changes in the external environment, such as changes in the local and national economy.
Ways to mitigate risks include getting a second or third opinion about the business strategy and plan from experts and others, considering worst-case scenarios, making contingencies for all possible eventualities, and the like.
Image Credit: flickr.com/Robert Nunnally
Tips on Writing a Good Business Plan
Writing an effective business plan for job recruitment agency entails due consideration to the following the steps:
Write with the objective in mind. For instance, if the purpose of the business span is to secure funding, the business plan needs to be quantitative, specifying the expected client base, revenues, cash flow, profits, and other figures in comprehensive terms, and the justification for such figures.
- The most effective plans are concise and brief, but such conciseness should not come at the cost of details. Pay attention to often-overlooked minor details. Examples include search engine optimization of the recruitment website, details of printing visiting cards, policy on hiring cabs, and the like. All these are trivial in most businesses but form critical components of business operations for a job recruitment agency.
Make sure to ensure all key components in the business plan. The key components include an executive summary, company profile, product or service mix, market survey, competition analysis, team details, product development, marketing strategy and product positioning, operational details, risk analysis, and budgeting and financial details.
A good business plan makes starting the business easy and contributes to its success in a big way.
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