After a year of record growth in 2018, the UK recruitment industry looks set to continue in the same vein this year. But what is driving it and how can recruitment business leaders capitalise on the rising demand for their services?
The primary reason being persistent difficulties that employers are facing in relation to the shortage in the supply of candidates. As their own talent pools are drying up, employers are increasingly looking for support from recruiters to help them overcome these challenges.
Research published in February by the REC shows that the number of people employed by the recruitment sector has increased 15 per cent to 115,000 since 2016/17, while total placements made by recruiters rose by 14% over the same period. Not surprisingly, eight out of 10 recruiters expect revenues to keep rising over the next 12 months.
The key to successful growth is preparation
Richard Branson famously said: “If someone offers you an opportunity, but you are not sure if you can do it, say yes then learn to do it later”. Trouble is, too many recruitment business leaders take this the wrong way – accepting the challenge (such as to supply 100 contract workers) is one thing, however doing so without the necessary infrastructure in place will backfire.
Suppose you’ve worked with the same client for a couple of years on various assignments, placing a dozen or so contractors each time. What if that client wins a major project requiring them to double or more the number of workers they used ask for? You may be able to find those workers, but the question is whether or not you have the funds in place to pay them each week.
If you don’t, you will need to consider what this means for your business: will you be able to hold on to your client, or is there a chance of them partnering with a competitor who has the means to support them? It is a dilemma and one that is very easily overcome by preparing your finances before you take those first steps to growing your agency.
Keeping the cash till ringing
Chances are that in January you mapped out your growth plans for the next 12 months. But like all business owners, you know that the objectives you have set can only come to fruition if each of your clients pay on time, every time.
Yet this rarely, if ever happens. It can take between 60-80 days on average before payment is made and this can see the targets you have set for the business constantly being pushed back. So, it comes as no surprise to learn than more than one in three (37%) of small businesses report having cash flow difficulties.
Cash flow is the lifeblood of every business and ensuring you have the right recruitment finance in place is critical to providing you as the agency owner with the peace of mind that your workers and all other expenses are paid on time every week.
Of course, this has benefits that extend beyond the ability to meet the agency’s financial obligations every month, it releases cashflow tied up in invoices and therefore enables recruitment business leaders to plan their growth at the pace which suits them best.
So, if growth is in the plans for your agency in 2019, contact the Simplicity team and we can show you how we have been helping thousands of other recruiters to achieve their ambitions.