There are risks and challenges associated with starting any new business, and setting up your own recruitment agency is no different. Whether you’re a seasoned recruiter striking out on your own, or an entrepreneur completely new to the industry, it’s important to take the right steps to minimize risk and successfully start your own recruitment agency. Here’s what you need to know, including tips for making it work. 

What is a recruitment agency?

A young entrepreneur ready to start her own recruiting agency.
Starting your own recruiting agency can be rewarding, but success depends on preparedness.

Before we get into the details, lets cover some basic definitions. If you’re already in the recruitment space, as a jobseeker, client, or recruiter, this may be old news. But for the uninitiated…

A recruitment agency is a firm that helps clients to source and hire suitable candidates for open job roles. Typically, agencies provide services to both employers and candidates, connecting companies with suitably qualified talent. They often help employers to fill difficult or specialized roles. 

Employer Services

  • Recruitment agencies assist employers in filling job vacancies by sourcing, screening, and presenting qualified candidates. This can often include finding suitable candidates who are not actively seeking a job but may be willing to move for the right opportunity.
  • Agencies build their own talent pool of pre-screened candidates, saving time and effort in the hiring process.
  • Some recruiters may also provide additional services such as background checks, skills assessments, and reference checks to ensure the quality of candidates.

Candidate Services

  • Recruitment agencies can offer employees better opportunities that match their skills, experience, and career goals. They may provide access to roles that aren’t being publicly posted or announced.
  • The recruiter is likely to have valuable insights into market trends, salary benchmarks, and industry dynamics that can help candidates make more informed decisions about their career.
  • Agencies often help a candidate with resume writing, interview preparation, and other resources. They may also check in post-hire to make sure onboarding is going smoothly.

Ultimately, the recruiter is working toward success for both the candidate and the client, as its in all three parties’ best interest that the placement is a good fit.

6 Key Considerations for Starting a Recruiting Agency

There are many things to consider when starting any new business, and recruiting is no different. The best advice will come from your fellow recruiters and mentors — the best way to start recruiting is by working with and learning from someone who already knows the ropes! But to help you get started, here are six key points to take into account: 

1. Business model

Your business model will largely depend on the type of recruitment you plan to do, and the industries or niches you will serve. Here’s a table of popular models to help you decide which one is most appropriate for your recruitment business:

Agency TypeDescription
Temporary Staffing Commonly used during peak seasons, special projects, or covering employee absences, these agencies provide temporary employees for short-term positions.
Direct-Hire Placement Focused on finding permanent employees for clients, these agencies assist employers in identifying and hiring candidates for full-time positions. They typically charge a fee per successful placement.
Temp-To-Hire Taking a hybrid approach, these recruiters find candidates who work temporarily or on a short-term contract with the possibility of permanent hire. This allows employers to assess performance and fit before making a long-term commitment.
Executive Search Specialists in recruiting high-level executives and senior managers in a particular industry or set of related industries. Often uses a retained search model with upfront client payment.
Industry-Specific Focusing on specific industries or sectors – like healthcare or technology – these agencies possess deep industry knowledge to source candidates with relevant experience.
Contingency Recruitment Working on a ‘no win, no fee’ basis, these agencies only receive payment only upon successful candidate placement. Agencies compete to fill client vacancies and typically prioritize volume.
Recruitment Process Outsourcing (RPO) Offering comprehensive services, these providers cover all or part of the outsourced recruitment process, acting as an extension of the client’s HR department.

2. Niche and value proposition

For seasoned pros, the specific niche or industry where they have the most expertise is a good place to start. It’s not advisable to switch sectors while starting a new agency at the same time, especially if you have an existing network of contacts and talent pool to draw upon.

For newcomers, it’s important to pick an industry where you have relevant employment experience. If you previously worked in IT, you might specialize in helping companies to recruit software developers, for example. You might also spot an opportunity in a particular sector, job function, or geographic area. 

Alongside your chosen niche is your agency’s value proposition. What will set you apart from competitors? It could be many things: specialized knowledge, personalized service, or innovative recruitment techniques. Whatever it is, make sure potential clients understand why they should choose your agency over another.

3. Talent cultivation 

Irrespective of your recruiting experience, it’s imperative that you leverage your existing network of contacts in the industry. Reach out to former clients, colleagues, and industry professionals who can provide referrals or support. 

Attending networking events, industry conferences, and trade shows will help expand your network further. The strong relationships you build will be crucial for growing your client base, and building your private talent pool of passive candidates.

4. Recruiting roadmap

All businesses need a comprehensive business plan. It’s essential, especially when you’re applying for funding from a bank or investor. A well-defined plan will serve as a roadmap for your business, and help you stay focused on your objectives.

Ensure your business plan outlines your agency’s goals, target market, financial projections, and marketing strategies. Consider factors such as startup costs, revenue streams, pricing structure, and scalability.

Be realistic about your financial projections and budget accordingly. Recruiting may not be a steady income stream, especially at the start, so planning ahead and saving up for leaner times will be important.

5. Strong relationships

Recruitment is a people business. Building strong relationships with clients is essential for long-term success. Listen to their needs, provide personalized solutions, and deliver exceptional service. 

Clients will appreciate regular communication – whether by phone call, text, or email – to stay updated on candidate progress. You may want to keep an active profile on social media, a blog, or newsletter to illustrate your industry expertise.

Candidate experience is also important. A positive candidate experience not only reflects well on your agency, but also increases the likelihood of referrals and repeat business. Keep in mind that the person you place today may be the one who reaches out to you about filling a role next year.

6. Tech stack

Grow your business by embracing digital marketing strategies such as social media, email campaigns, and job description SEO to increase your agency’s visibility and attract clients and candidates.

Invest in recruitment software and tools to streamline your processes and improve efficiency. Applicant Tracking Systems (ATS), recruitment CRM software, and job boards can help you manage candidate pipelines, keep track of all your interactions, and help you fill and maintain your own private talent pool. 

The best recruitment agency software 

We’re biased, of course, but we recommend PCRecruiter for any new agency. Our hybrid of applicant tracking and candidate management tools have helped countless small recruiting firms. And with scalability and customization, the system will grow with you as your agency thrives.

From powerful sequencing to secure data storage, PCRecruiter makes your day-to-day easier, taking the repetitive off tasks off your mind so you can focus on the important things – like building a recruitment agency. 

Explore what PCRecruiter can do for your agency with a free demo from one of our experts. Book a demo

Recruiting CDL drivers is complex and time-consuming work. Getting it right takes time and industry know-how that a generalist recruiter or an HR team doesn’t always have. That’s where Recruitment Process Outsourcing (RPO) and the right recruitment tech can help.

Trucking – and the transport infrastructure around it – keeps the wheels of the economy turning. Right now in the US, demand for Commercial Driver’s License (CDL) holders far outstrips supply. In fact, it’s estimated that by 2028 there could be a shortage of around 160,000 qualified drivers, according to the American Trucking Associations (ATA).  

Recruiting CDL drivers is complex and time-consuming work. Getting it right takes time and industry know-how that a generalist recruiter or an HR team doesn’t always have. That’s where Recruitment Process Outsourcing (RPO) – outsourcing the recruiting process (or part of it) to a third-party specialist – can help.

We spoke with Peggy O’Donnell – owner of TransDirectUSA – to discover why transport and logistics firms are turning to RPO to fill roles in the industry.

It’s An Industry That’s Always Moving

Peggy O’Donnell started TransDirectUSA back in 2015. Since then, the company has grown to 10 recruiters, serving transport and logistics firms across the US with everything from high-profile executive searches to long-term partnerships for recruiting and onboarding. 

With more than 25 years combined experience of recruiting in the sector, Peggy and her team are specialists, sourcing and recruiting candidates for a variety of roles, including fleet managers, dispatchers, route planners, diesel mechanics, and drivers. 

It’s not necessarily that there’s a driver shortage – there’s a lack of drivers with the right level of experience – 1 to 2 years – for insurance purposes.

Peggy O’Donnell, President & Owner, TransDirectUSA

Right now, around 90% of the firm’s open roles are for CDL drivers. With 30 years in the industry plus her background in operations this comes as no surprise to Peggy. The reason? It’s not an easy industry to break into, and it’s a tough life out on the road in the early stages of a career – certainly for the first few years when gaining experience.

Once drivers have the necessary years of experience, it’s possible for them to get a much better work/life balance. On top of that, post-pandemic, the transportation sector has been catching up in terms of pay (with increases of up to 20%) making truck driving a more appealing career choice. After all, truck drivers are a vital part of the economy. Without them, deliveries aren’t made, and companies lose revenue. The challenge for transportation and logistics firms is how to recruit and retain the best CDL drivers. 

RPO Drives the Open Highway For Hiring

For HR departments and in-house recruiters, acquiring and retaining CDL drivers is uniquely challenging. Putting out job ads, using job boards – even paying for Google Ads – are all valid options. But more often than not, they have limited success.

In terms of the numbers, the TransDirectUSA team find that on average out of 100 potential candidates for a CDL driver role, around 4% will meet the criteria. Of those that are put forward for interview, 1% are placed. That makes recruiting CDL drivers expensive and labor-intensive.

Most companies in the industry spend more per hire on CDL drivers than any other roles. Bringing in a specialist can help companies place more drivers and keep down hiring costs.

Peggy O’Donnell, President & Owner, TransDirectUSA
Photo by Quintin Gellar:
Outsourcing CDL driver recruitment to a professional agency can help HR managers focus their efforts on internal tasks and improve overall efficiency of workforce development.

In the past, Peggy and her team would deal directly with transportation managers — those people in charge of the drivers and usually the hiring manager. These days, this is typically done as part of HR. But HR teams have a lot on their plate (retaining good people, running training programs, and so on) beyond just looking after drivers. They’re considering every role in their organization, from the warehouse floor to the C-suite. 

RPO for CDL drivers is a cost-effective solution, enabling companies to streamline and improve their recruitment and hiring processes. By outsourcing one of the trickiest and most expensive pieces of the puzzle, HR teams reclaim valuable time spent on sourcing and calling candidates. In exchange, they can focus on other HR activities that add more value to their business.

Driving Candidates Down The Final Mile

Like any niche or sector where the best candidates are in high demand, recruiting CDL drivers is complicated by the fact that they’re usually already in a role. That’s where the benefit of RPO comes into play. Peggy calls it ‘organic sourcing’ – reaching out to passive candidates to alert them to better opportunities. To do that effectively takes time and expertise. It also takes the right recruitment tech.

In her own words, Peggy – like many recruiters – is not a tech person. It’s a people business, after all. But the backbone of her operations over the years has been PCRecruiter. It’s powerful enough to do the heavy lifting, yet simple for non-technical team members on a daily basis. 

When hiring drivers, there’s still what I call ‘the final mile’. When a driver’s talking to a recruiter, they want to talk to somebody, who knows their business. And to get them to that placement, you need expertise.

Peggy O’Donnell, President & Owner, TransDirectUSA

In fact, Peggy and her team only use PCRecruiter, so that everything happens from inside one system, from form letters to candidate tracking. Recruiters can also track their call goals, and Peggy runs a daily report. It’s also used in Business Development for recording conversations. 

Peggy’s first to admit she’s still discovering new ways to use PCRecruiter to streamline her workflows and processes. Right now she’s excited about growing her use of automation and integration between candidate applications and the pipeline. She’s leveraging online applications to save time on manual data entry and to reduce human errors.

To discover how PCRecruiter can support, strengthen, and streamline your recruitment activities. Contact us