The impending second lockdown is a very daunting prospect. However, plenty of individuals have been using this year to initiate change, be it by choice or circumstance. You may have gotten used to working remotely, realising how effective you are without immediate support. A redundancy may have made you consider venturing out on your own, so you aren’t reliant on somebody else giving you a wage. Regardless of the reasons behind it, if you have decided that forming your own agency is the route you want to take, you will no doubt be asking yourself: How much money do I need to start my own recruitment agency?
The simple answer to this question is: not a lot! And here is why:
Assuming you have a computer and a mobile phone you can start and run a successful freelance recruitment business with a relatively empty bank account.
Think about the two most important costs of a freelance recruitment agency. These are:
Whilst there are many additional costs that an agency will incur over time (such as a website, a CRM, job boards, marketing etc.) none of these are integral in getting the business off the ground.
The most successful recruiters that we see at Quba Solutions are those that focused, driven and determined to succeed.
Placing freelancers creates a cashflow issue, due to waiting for your invoices to be paid by your clients whilst having to pay your workers. This is the true cost of running a recruitment business and where large debts can occur, but this is also where Quba can offer exactly the support you require.
Quba’s invoice finance solutions will not only pay your temps every week, but will also pay you the margin gained, providing an instant income into the business. In addition to this we provide full back office services that match, in many cases beat those of any blue-chip corporate agency, enabling your new business to compete at the highest level without such expenses as offices and staffing.
These solutions are charged based upon your weekly turnover, meaning no signing up fees, minimum monthly fees or start-up costs. As such there is no need for financial investment prior to starting your business.
The only requirement for any cash reserves for a new agency is to cover personal costs (such as a mortgage), whilst the business is building over the first couple of months. There are other complex funding options and potential investors available that will offer a salary or funding injection at the start when forming your business to tie you over during this period, however they tend to be at the expense of either equity in the business or a far more complex funding model that often doesn’t include many back office services such as payroll or credit control.
Running a successful temp desk will quickly provide the cashflow needed to cover personal costs when supported by a funding partner like Quba. For example, placing 5 temps on £10 pay/£15 charge placements would net the business in the region of £450 per week.
If you would like to learn more about how our solution and whether it can provide all of the funding and services you need, please call one of our funding professionals any time on: 01305 233178 or contact us here.