What to Do Before Opening a Recruiting Agency

Published in

Loxo Blog

8 min readJan 10, 2019

Starting a new company is exciting, but there are many tasks to complete and boxes to check before you open your doors for the first time.

The more you plan and prepare, the smoother your recruiting agency’s launch will be and the better equipped you will be for succeeding in your company’s chosen recruiting niche.

We have also written posts on How to Start a Recruiting Business from Home and How to Start an Executive Search Firm to help you get your company up and running.

Here’s what you should do before opening a recruiting agency.

Create a Recruitment Agency Business Plan

The first step you should take before opening a recruiting agency is to create a business plan.

Creating a business plan will help you define your company’s strategy, plan the logistics of launch and operations, and showcase your company’s opportunity to potential investors and/or lending institutions.

These are the questions that your business plan needs to answer:

Who?

Who are you, your partners and your recruiters?
Who are you and what is your recruiting specialty?
Who are the senior partners in your agency and what are their specialties?
Who are the recruiters you will be hiring and what are their specialties?
Who in your agency has worked with the highest profile companies or on the highest profile hires?

Who are the target customers of your agency?

What industries are you and your recruiters most experienced working in?
Where do your target customers operate and why?
What separates a great potential client from a potential client that you will have a reduced ability to serve?
Which companies have been repeat clients of you, your partners and your recruiters?
Which companies in your area have the greatest number of jobs that your agency excels at hiring for?

What?

What is the opportunity you will capitalize on?
What market trends and conditions will give your agency an advantage?
What client companies are you preparing to contract?
Which industries do you have extensive connections in?
Is there high demand for agencies with your specialty in your area or throughout the country?
How will you use technology to help you further capitalize on identified opportunities?

What is the specialty of your recruiting agency?

What industry or niche do you and your recruiters have the most experience working in?
What specialized recruiting skill sets do you and your recruiters possess?
What proof can you offer to clients that demonstrates the value of your company’s specialized services?
How will you use technology to further excel in providing your specialized services?

What advantage will you give to clients?

Do you have an advantage recruiting for a particular role, hiring volume, area, seniority level, industry, skill set, company size, etc.?
Can you offer recruiters to your clients who are entirely dedicated to one project?
Do you, your partners and your recruiters have industry and/or candidate connections that will give your clients an advantage?
Do you use cutting-edge recruiting technology to source better clients and place them faster than your competition?

Where?

Where will your agency be based?

What city will you be based in and where will your headquarters be?
What is the cost of living and the cost of office space in this city vs. nearby metro areas?
Will being based in your chosen area give you an advantage when attracting recruiting talent to your agency?
What are the major industries in the metro area where you are based?
Will clients from outside your area be able to easily travel to your office?

Where will most of your clients be based?

How many companies are there in your metro area that match the profile of your target customer?
Nationally, where is the highest concentration of companies that match the profile of your target customer?

When?

When will you launch your company?

How long will it take you to prepare for and complete your agency’s launch?
When will you hire your recruiters, researchers and admin employees?
When will you secure funding to cover startup costs and when will you have to make your first return payment on this loan or invested funding?
What opportunities do you hope to capitalize on in your first year of operation and how will you ensure that you are operational when the time comes to seize the opportunity?

When will you expand your company?

Which benchmarks must be reached before hiring more partners, recruiters, researchers and admin employees?
What is your maximum capacity to serve clients and when will this prevent you from signing a new client?
How will you expand your capacity to serve clients within the first year of operation?

Why?

Why are you opening your agency?

What are the opportunities that your agency will be seizing and the trends that you will capitalize on?
Why does it make sense for you to make this move at this point in your career and in the careers of your business partners?
Why is your company going to be positioned to seize opportunities in your area of operation and beyond?

Why is your recruitment agency going to be a success?

Why will your agency’s specialty be in high demand?
Why are you going to be more successful than competitors in your area?
Why should investors and/or banks help fund your agency?

How?

How will your company capitalize on the opportunity you have identified?

How has your career and accomplishments given you the knowledge and the clout to succeed in your company’s chosen niche?
Which partners and recruiters will be critical for capitalizing on identified opportunities in your area and/or industry?
How will technology increase your ability to capitalize on identified opportunities?
What innovations will you bring to recruiting in your chosen niche and how will you execute these breakthroughs?

How will you meet up startup requirements?

How are you funding the costs of starting your agency and the costs of your first 6 months of operations?
How are you going to find the recruiting talent your agency needs?
How are you going to find your first clients and become self-funding?

Your business plan must also answer the following logistical questions about your company:

What kind of legal entity will your recruiting agency be classified as?
What is the ownership structure of your company?
What are the startup and monthly operating costs of your recruiting agency?
What are your forecasted profits and losses for your first year of operation?
What are the initial staffing requirements of your recruiting agency?
What is your strategy for signing new clients and who will your first clients be?
What is your strategy for marketing your recruitment agency to potential clients?

Build Your Brand

Your recruiting agency needs an appealing, well-defined brand to give new clients confidence in your abilities and to grow the reputation of your new company.

These are the baseline brand assets you should develop before opening your agency:

A logo that fits your company’s focus and the clients you serve.
Business cards, letterhead, branded pens and other physical branded assets to give to new and potential clients.
A company website that is streamlined, appropriate for your company’s specialty and client base, and easy to navigate.
Social media profiles for your company on platforms used by your target customers.
Case studies and testimonials created from the work you and your recruiters have done.
(Bonus) Short blog or Linkedin thought leadership content that is relevant to your company’s focus.

Find Recruiters and other Staff

You may not need an army of recruiters to start, but you will still need to have major recruiting talent on your side to ensure your first clients are served successfully.

What are your requirements for recruiters?

How many recruiters will you need to employ for your first month of operations? First 3 months? First 6 months? First year?
What industry/niche experience will your first recruiters need to have?
What certifications will your clients expect your recruiters to have?
How many years of experience will they need?
What size of company must they have experience serving?
What roles must they have experience recruiting for?
What kinds of tools must they have experience using?

How will you attract recruiting talent to your agency?

What will a recruiter gain by accepting a job at your company?
Why should they take a job at your company over a well established competitor in your area?
How will you advance the career of the recruiters who work for your agency?
How will recruiters be compensated and how does this compensation compare to competitors in your area?
What specialized technologies will you provide for your recruiters to make their jobs easier and make them more effective?

Start Looking for Clients

Before you open your agency, you should have a few clients under contract or near signing a contract with your firm.

The last thing you want is to trip on your first step out the gate, so start looking for clients well before you start incurring operating costs to ensure a successful launch.

Request that all partners, recruiters, researchers and admin employees submit new client leads, such as repeat clients they have worked with in their careers.
Request that all partners and recruiters reach out to past clients to inform them that your company is launching and to pitch them on being one of your first clients.
Identify companies in your immediate and adjacent metro areas that match your target customer profile.
Identify companies matching your target customer profile that are displaying a need to hire (new branch opening, product launch, large amount of funding secured, etc.).
Contact companies that are broadcasting a need to hire via press release or other PR outreach.
Gather leads from landing pages on your website and social media profiles.
Invest in PPC advertising in metro areas with high search volumes for the specialized recruiting services that your company provides.

Secure Business and Recruiting Tools

You will need quite a few business and recruiting tools to ensure successful operations, so start researching the best tools for your agency well before you launch.

Here are the major functions of the tools your agency will need:

Identifying, sourcing and storing the data of candidates who match the requirements of your target customers.
Managing communications with active and passive candidates (optimized for drip conversion to save work hours for recruiters).
CRM to manage new and ongoing client communications, contracts, leads, etc.
Identifying and collecting new client leads.
Creating and managing marketing campaigns focused on specific areas, clients, social platforms, etc.
Managing finances, accounts payable/receivable, payroll, taxes, etc.

Loxo is an all-in-one recruiting platform with a complete collection of recruiting and business tools to increase the effectiveness of your recruiters, reduce overhead and save time for everyone at your agency.

Loxo includes an ATS + CRM, Loxo Connect (contact info finder), LOXO AI (sourcing automation) and a recruitment marketing tool suite, making it easy to identify talented candidates and move them from sourced to closed. With features like “click to call” and marketing automation, your recruiters will be happier, more effective and more likely to close projects successfully.

Loxo connects you with candidates by sourcing them through proprietary AI and populating Loxo’s CRM + ATS with their contact information. Loxo also helps you connect with candidates using a full suite of marketing features to grow candidate interest in your opportunities.

To learn more about how Loxo can help your agency, you can schedule a demo to see Loxo in action.