Entrepreneurs guide into how to grow your recruitment business – The right way
Growth is good for businesses; therefore, you would think all growth is good. However, too much growth or growth that occurs far too quickly can be a danger to your recruitment business.
What could happen if growth gets in the way of your recruitment dream?
To put it straightforwardly, you can compare running a recruitment business to maintaining a car. Driving your car fast will consume more fuel and ultimately become more expensive to run – the same goes with your recruitment business. So, quickly growing your business will create a demand for finances to meet ongoing growth and take advantage of possibilities that may arise.
When you start placing candidates and see your profits grow, you may get very excited. Nevertheless, your business has not yet progressed, and, at this point, it is easy to make a mistake and think it has.
How to save time and money?
With the current boom in the job market, which includes the record number of vacancies available, recruiters are needed now more than ever. To keep up with the industry, recruiters need to focus all their time and energy on placing the best talent suited to their clients’ requirements.
Two very important things that most successful recruiters do is; that they don’t take chances with their cash flow and only use their time and energy on doing what they do best, as they outsource to a third party to do the rest.
Generally, the most successful recruiters outsource admin tasks meaning they avoid wasting time organising payroll, raising, sending, and chasing invoices. By outsourcing, these recruiters can focus on developing their business and prospect pipeline.
Is funding your future growth the way forward?
Running into debt issues can easily happen if you begin to heavily borrow money to fuel your fast-growing recruitment business, but what if things don’t work out the way you planned, and your growth slows or levels out? You could be left with a large debt to pay back without the levels of cash anticipated to pay for it. Missing a payment or, in general, having a bad month could result in issues occurring. Moreover, adding credit limit issues into the equation could cause real problems.
Limits on the amount of money that fast-growing recruitment businesses can access are one of the owners’ biggest frustrations. It’s common for non-specialist finance providers to apply concentration limits on clients. Additionally, it penalises you for doing what you do best in simple terms.
Generally, business growth is pre-determined by having a credit limit cap in place. Businesses are even put into a situation whereby they have to decline work due to agreements with their finance provider, which prohibit them from going above a credit limit. Moreover, this will restrict business growth and create cash flow challenges.
The most successful recruitment business owners are particularly savvy when it comes to financing their agency’s growth. They seek funding solutions from recruitment specific providers, such as; Recruitment Finance, Factoring and Invoice Discounting, that understand the industry and the best way to manage their cash flow.
Business growth is essential to becoming successful! Therefore, sustainable growth, which is managed well, is the best way forward. Understanding the balance between your ambition and what you need to do is essential to managing your growth well.
The answer is Simplicity
Simplicity has provided the recruitment industry with market-leading financial services for over 18 years, and with experience comes knowledge. We understand the industry and the services you need to achieve your growth aspirations. Our Recruitment Finance solution includes 100% finance, Full back-office support and pioneering recruitment technology.
To find out more about our recruitment finance solutions, please speak to a member of the Simplicity Sales team on 01594 888518.