Blueprint – How to Start a Recruiting Agency in 2021, Part Three

This post is the third in a three-part series:

Part one – Developing a plan for starting your recruiting agency

Part two – Your recruiting agency’s operations and financial plan

This list of considerations and suggestions is a supplement to the first two posts in this series, ‘How to Start a Recruiting Agency in 2021.’

In my first post, I discussed the importance of developing a plan for starting your recruiting agency and some of the common reasons for agency failure. I also focused on the importance of understanding your market opportunity, and developing your sales and marketing plans.

In my second post, I wrote on the best ways to develop, test and improve your agency’s operations and financial plan.

Here, I’m providing a bulleted list that should provide some insight into  everything you’ll need, or nearly everything you’ll need, to consider.

Business – Guiding Documents to Start a Recruiting Agency

Operations – Core Functions and Tools to Start a Recruiting Agency

Finance to-dos for Your Recruiting Agency

  • Get a CPA/Accounting firm (You should be selling and recruiting, not doing your taxes)
  • Fully separate your finances from the business (crucial)
  • QuickBooks and a Chart of Accounts
  • Company bank account
  • Company credit card
  • Method for getting paid (Credit cards | Check | Wire) – (If you’re using QuickBooks for accounting, you can also use their payment system.)
  • Quarterly estimated tax payments
  • Self-employment tax/Tax filing plans (LLC, LLC as S-Corp, Etc.)
  • Dealing with 1099MISC and 1099-K
  • Capitalization policy-safe harbor de minimis threshold

IT Considerations for Your Recruiting Agency

  • Time tracking
  • Professional email account
  • Phone system
  • Domain name
  • Web hosting
  • Recruiting CRM/ATS (I’m kind of partial to Crelate…)
  • WiFi / Internet upgrade (Don’t mess around with bad internet)
  • eSignature Tool (HelloSign or other)
  • VoIP Provider (RingCentral or other)
  • A fast and powerful laptop with a monitor and headset
  • Comfortable office chair and desk (Don’t skimp here, or money saved on your chair and desk will be spent at your chiropractor)

Legal Minutia for Your Recruiting Agency

  • Business start date
  • Type of entity
  • Insurance (General liability, etc.)
  • Operating agreement/Articles of incorporation (Special Topic:  Will you plan for partners?)
  • Loan/Investor documents
  • File with your Secretary of State
  • File with your State Department of Revenue
  • Apply for an IRS EIN
  • Deal with local business taxes (City, State, Local, Personal Property Tax, Sales Tax)
  • Deal with out of state income / Nexus rules
  • Record retention plan
  • Master service agreement
  • Statement of work template
  • Accounting and HR Policies

HR – Preparing for Employees/Contractors

  • HR Policies
  • W-9 from vendors
  • Payroll taxes
  • W4 and I9’s
  • Benefits
  • Ensure that your 1099s are actually independent contractors
  • Employee/PII agreements

Other and Miscellaneous HR Considerations

  • Self-employment retirement plans
  • Self-employment health insurance
  • Home office deduction or simplified method

Marketing Your Agency

  • Website  (A professionally built, custom website is practically a must-have for a big agency. But there are lots of easy DIY solutions out there for agencies that are just starting out.) A few commonly used tools include:
  • Candidate portal/job widget (I hear Crelate’s candidate portal and job portal are a good option… *ahem*)
  • SEO optimization/AdWords (Making sure people can find your recruiting agency online is vital, so it’s also vital to make sure your site and any content you publish on it is optimized for search engines (like Google or Bing). An important part of making your site search-engine friendly is using highly searched keywords in your content.) There are a number of tools that can help you identify keywords with the highest search value:
  • LinkedIn profile for your business (A LinkedIn profile is almost requisite for any professional today, and that’s especially true for recruiters… and recruiting agencies. Learn more about how to harness the full power of LinkedIn for recruiters on the Crelate blog.)
  • Logo  (As I said, you don’t need to invest much time or money into this. But you will need something for letterhead, email signatures, etc.) If you don’t have personal connections with any artists or graphic designers, there are lots of places where you can connect with one online, including:

Recruiting or Staffing Agency Sales 

  • CRM system (I recommend Crelate…)  
  • Define your sales stages and processes  
  • Contracts (See legal)  
  • eSignature (HelloSign or other)  
  • LinkedIn Sales Navigator/other tools? 
  • What are you offering? What’s your pitch? What’s your secret sauce?  

Core Recruiting Processes and Tools 

  • Applicant Tracking System (I hear Crelate is a good one…)  
  • What are you offering? What’s your pitch? What’s your secret sauce?  
  • Sourcing Tools/Job Boards 
  • Define your processes/stages 
  • Client portal/How you are going to work with clients ? (Crelate has you covered here, too…)  

This list is by no means complete, and specifics of your vertical and location will dictate a lot of the details. But hopefully this advice and list of considerations gives you a place to start.

Good luck!

 

Filed under: Applicant Tracking Systems, Staffing Agency Management