Sinking recruitment agencies

5 Big Mistakes That Could Sink Your Recruitment Agency in the First Year

August 24, 2020 8:26 pm Published by

5 Big Mistakes That Could Sink Your Recruitment Agency in the First Year (and how to avoid them)

Why do some agencies thrive from day one and others disappear? When you look into the answer, it turns out there are some common errors that trip up new recruitment businesses. So here’s what NOT to do when you start your own recruitment firm.

1.   Failing to define what makes you unique

Too many agencies fail to attract business because they don’t stand out. Blending in can kill your business in this crowded market. So it’s vital you know what makes you special and identify why potential customers should choose you over your competitors.

How do you do that? Dig deep into what your rivals are offering, spot their weaknesses, and offer something they don’t. Then you can pinpoint what makes your agency different and tell your customers why you are the best.

2.   Spending too much on the wrong things

Taking on too many employees and taking out a hefty director wage are deadly errors new agencies make in the first year. Don’t be one of them. Make sure you know what is really a necessary expense and what is a luxury you can’t yet afford.

Think about whether you really need to invest in an office space. Could you begin at home or in a co-working space?

Staffing is also a large overhead that you may not need to invest in straight away. It’s not just their wages you need to account for – there’s payroll, pension schemes, taxes, holiday pay, insurance, and all the equipment they need to start.

Look at the digital tools that will help you grow your business instead. And there are many specialist freelancers and virtual assistants who can take on work for you without the risk and cost of employing someone. So don’t rush into taking on your first employee until you know the true cost involved.

Another area where money can quickly be lost is on the website. Talking of which…

3.   Building a poor website

You can’t afford to get this wrong. Pages that take ages to load, links that go nowhere, missing information, nowhere to load a CV… visitors to your website are quick to click the back button and they won’t give you a second chance.

Website building is a specialist job – probably beyond the abilities of your mate who set up their own 5-page WordPress site a year ago and has offered to help.

You need one designed for a recruitment agency. Think about how easy it is to read on a mobile, what the layout should be, and make sure it SEO-friendly. It’s important to know what the website has to do, both on the front end and the back end.

4.   Not putting customers first

Too many firms put the focus on themselves, not their customers. And this filters into the marketing – with the emphasis on how great they are, not on how they can help. So it’s no surprise they get ignored by the people they’re supposed to be attracting.

To succeed, you need to put your customers, (new and established) at the centre of everything you do in your business. Learn all about them. Find out how they talk, where they hang out, what their interests are, what their fears are. Don’t make guesses, get out there and speak to them for the answers. By the end, you’ll probably be able to finish off their sentences!

Don’t put the focus on what you’ll gain from setting up your recruitment agency, put it on what the customer gains.

5.   Relying on 1 or 2 big clients

This is a classic trap new recruitment businesses fall into. They put all their time and energy into serving a couple of big clients, who then get a better offer and leave – forcing a mad scramble to find replacements before funds dry up.

The recruitment industry can be fickle, so make sure you have a healthy mix of clients from the start. A diverse portfolio is a healthy one.

You can do this!

Those are 5 common mistakes you can easily avoid if you take the time to make a solid plan and think about how you’ll take each step forward. Going from employee to being your own boss comes with bigger risks, but bigger rewards too.

Related: Recruitment success: 8 reasons to get pumped up about starting your own agency


Jason Connolly set up JMC Legal Recruitment in 2016 when he was still in his 20s. JMC Legal quickly established itself as one of the big players in the industry, and Jason has also become a well-known fixture in the press, offering advice and support.

JMC Partners is looking for recruiters interested in starting a business partnership under the JMC brand. Find out more here or contact our office for more information.

This post was written by jmcpartners

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