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How to Start A Recruitment Agency Today

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    How to Start A Recruitment Agency Today

    Man considering how to start a recruitment agency

    If you’re an experienced recruiter wondering how to start a recruitment agency, you’ve come to the right place. As a support service for recruitment start ups, we’ve helped thousands of recruiters start new businesses.

    In this blog, we’ve focused on providing the answers to the most common questions around starting a recruitment agency. From what you’ll need in your business plan, to reasons to start.

    Am I ready to start a recruitment business?

    If you’re reading this article the chances are you already know you’re ready to start. One of the biggest obstacles any business owner has to overcome is self doubt. So instead of focusing on how competitive the market is, or whether it’s the right time to start a recruitment agency, let’s focus on the positives.

    • The recruitment industry is responsible for contributing over £35bn to the UK’s economy, a number that keeps growing. 
    • You’ve already done the hard work and understand the recruitment business model.
    • You possess a network of existing contacts that people would pay for.
    • You’re confident in winning new business
    • You don’t have to do this alone, there are support services like Simplicity that can help.

    What do I need when starting a recruitment agency?

    Before applying for finance or a business loan, it’s important to consider the associated costs of setting up a recruitment agency on your own.

    Working for an established recruitment firm usually means all costs are covered. But here’s you’ll need as part of your start up business plan:

    A CRM or Database

    Invest in a safe and secure database to store your client’s information. This is not only critical to your success, but important for legal reasons. Most CRM providers will offer recruiters annual subscriptions to use their platform. But remember any bolt on accessories like email marketing and reporting are often an extra.

    A Website

    Having a digital presence is essential for any new recruitment agency. A recruitment website should have the functionality to display your vacancies, share advice, collect information and showcase your business. However, your website can also become your greatest marketing asset.

    Try creating unique and informative content to generate organic site traffic. Or perhaps try running advertising campaigns through Google, Bing or social media. There are a number of marketing agencies that specialise in helping recruitment companies.

    Job boards & CV’s

    CV databases like CV Library and Monster give recruiters a distinct advantage when searching for candidates. Job boards tend to charge monthly access fees, ranging from a couple of hundred pounds, to thousands. Advertising credits can also be purchased for job listings at an additional cost.

    A suitable space and staff

    Have you considered where your agency will operate from? Or whether your staff will work remotely?

    Home offices, shared office spaces and local commercial spaces are all viable options for modern recruitment agencies. But if you’ll be working remotely, remember you’ll need somewhere to meet clients and candidates.

    Using a site like Instant offices can help you find available office space when you need it.

    Recruitment Software & Tools

    Tools like LinkedIn Recruiter have become a reasonable alternative to job boards for many employment agencies. However, they come with ongoing monthly costs.

    There are other third party apps to consider too, like email marketing, that should be accounted for in your long term business plan and profit and loss sheet.

    A Fee Structure

    When starting a recruitment agency it’s important to consider how you’ll generate revenue. This might depend on whether you recruit for permanent or contract based roles.

    Most permanent recruitment agencies will charge a set fee depending on the vacancy. The fee will take into account the difficulty and seniority of the role as well as the candidate’s salary.

    Other agencies offer set fees for all vacancies, which your clients will love, but could lead to lower profits and higher labour costs. Use our earnings calculator to work out what your current earnings could translate to if you ran your own agency. This will help you realise what you can afford to charge.

    If you are recruiting temporary staff then you’ll need to account for employer costs on top of the workers pay rates. Under charging is quite a common mistake for start-ups and can be very costly. Try our margin calculator to make sure your margins are healthy. 


    If you’re setting up a recruitment agency for the first time you’ll need various insurance. It’s important to understand the regulations associated with the industry and the insurance you’ll need for protection. This can vary from assets, to protecting your business against negligence and liability claims.

    Back office staff

    Who is going to manage your payroll, issue invoices and chase late payments? You could employ a staff member, but that means an additional overhead. This is where Simplicity comes in. 

    We offer a back-office support service specifically for recruitment companies. Our service helps keep you on top of your admin, so you can focus on growing your business. For more detailed advice about our financial, back-office and tech support services, use the links below.

    I’m thinking of starting a permanent recruitment agency

    I’m thinking of starting a temporary recruitment agency 

    Office Equipment

    The last thing to consider is the essential equipment you’ll need to do your job. Things like computers, mobiles, landlines, wifi etc. For these it’s worth considering second hand sites and discounted business packages.

    Why start a recruitment agency?

    Just in case you needed an extra push, here are some of the reasons why you should start a recruitment agency of your own. (Our blog, 5 signs you’re ready to start your own recruitment agency, is another great place to start!)

    Easy entry

    Starting your own business is easier than you think. If freedom and flexibility are more important to you than climbing the corporate ladder, running a startup can be hugely rewarding.

    For experienced recruiters, setting up a recruitment agency offers lower barriers to entry than many other business ventures.

    Our solution enables recruiters to hit the ground running without concerns of cash flow shortages. We make sure you have the finance and protection in place to get your agency started. This includes a flexible funding solution that pays 100% of all invoices in advance, usually within a few days. So no waiting 30+ days for your clients to pay!

    Do something you know 

    To start a successful recruitment business you’ll need to find new clients. Most agencies are started by professionals who have dedicated years to building professional relationships with industry contacts.

    Non-compete agreements are extremely common and should be honoured. However, simply having a strong network could lead to your old clients recommending you to other new businesses.

    Some recruiters may consider starting in a new industry, but to hit the ground running we recommend using your industry knowledge to your advantage.

    You have experience overcoming challenges

    Like any business venture, starting a recruitment agency comes with its own challenges. Talent acquisition professionals must continually adapt to stay ahead of the competition. From dealing with shortfalls in talent, shrinking company budgets and understanding new skill sets. 

    Over the years, recruitment has proven itself as a truly recession proof industry. Every organisation reacts to economic or environmental crises differently, but there will always be those who grow. And that means businesses looking to hire.


    How to start a recruitment agency with Simplicity

    If you’re wondering how to set up a recruitment agency of your own, Simplicity is here to help. We can help you start a recruitment agency as early as today.

    Our team of experts have helped hundreds of recruitment agencies across the UK get started, in an abundance of industry sectors. Whatever sector you specialise in, the opportunities are there, as is the support from the Simplicity team. We offer a unique portfolio of services for ambitious and driven entrepreneurs looking to set up their own permanent, temporary or contract recruitment agencies. From 100% recruitment finance to debt protection, full back-office support and innovative technology. 

    For more information on how we can help you get started with your own recruitment agency, please feel free to get in touch today.