Common mistakes to avoid when setting up your own recruitment business

In his seminal book ‘The seven habits of highly successful people’, author Stephen Covey highlights starting with the end in mind, something many recruitment startups fail to do. Using the book’s wisdom, this article explores how dodge rookie mistakes and win.

It could be argued that recruitment is, above all else, a data business. It has been said that what recruiters do, when it all boils down, is to move a set of data called candidates to a set of data called clients. At Reed, we’d like to think there’s a lot more to it than that, but it’s an interesting position.

In our experience, recruitment start-ups make two critical errors when it comes to data:

• They don’t collect enough quality data
• They don’t house the data on a proper CRM system or database

Looking at the first of these, experience shows that too many solo-flyer recruiters start out with a mindset of “Well, it’s only me and I know my market and who my most likely potential clients are – all the information is in my head and that’s fine or now”. Or “I’m connected to the right people on LinkedIn so that will be okay for now.”

How to reach clients and candidates

In a digital age where more decision makers are working from home/remotely, reaching them by phone is harder than ever. What’s more, with the rise in intrusive calls from call centres, most of us are less inclined to take unsolicited calls from numbers we don’t recognise. As such, a start-up recruiter’s initial business development is going to have to be digital, with some of that being communicated via email.

Therefore, it is vital that a recruiter launching their own business gathers good quality data, and plenty of it, before they launch.

Data collection

And there’s a balance to be struck here. For many recruiters, doing the hard yards of data collection is too boring to contemplate – so they don’t do it. Conversely, some recruiters may hide behind data collection and avoid actually doing any BD – this means they become administrators, not recruiters. You can’t build your own recruitment business if what you are mainly doing is admin.

So, what happens is that the business never really launches successfully because the data collection is all a bit piecemeal and messy, after which the recruiter is playing a game of catch up with data collection – and invariably losing. Start with the end in mind and collect lots of good quality client data when you launch.

Data storage

The second mistake is housing it in the wrong places. We have seen recruiters launching solely from Excel spreadsheets, Outlook directories or the aforementioned LinkedIn contacts. Two things here: we would contend that it is impossible to build a recruitment business of any size without a good database. What’s more, one of the most overlooked common characteristics of outstanding recruitment companies is not necessarily their people, or their culture, or their sleek-looking websites – it is the size and integrity of their databases. Recruitment is a data business.

So again, when launching, invest in a good quality cloud-based database system that is specifically tailored towards recruitment and through which you can efficiently communicate with your customers and track activity.

How Reed Franchise Partnerships can help

At Reed Franchise Partnerships, we provide excellent support in both the areas covered. Firstly, before a new franchise partner starts with us, we reinvest part of their franchise fee and pay for two weeks of client market mapping with a company which specialises in this field. We then load this data onto the new business’ database so that they launch with around 350* decision makers with email addresses on their system. Franchisees can pay for more market mapping at discounted rates should they choose to do so.

Secondly, we provide our partners with their own private database on our propriety X3 CRM system. It’s the same system our 1,500 recruitment consultants use and is built to drive a modern, tech-led recruitment business. Therefore, from day one, your data is held on a secure system, allowing you to concentrate on building your business. We do not charge license fees for this.

Please get in touch via the contact form on our website if you’d like to learn more about how we set our partners up for success at Reed Franchise Partnerships.

*This number may vary depending on the complexity of the brief a franchisee gives our partners.