5 Tips for Starting Your Own Staffing Firm
July 28, 2015
Have you ever thought about starting your own staffing agency?
The thought of taking the jump can often feel scary, especially if you’re unsure of where you’re going to land. The world of entrepreneurship is full of unknowns, especially if you haven’t been through the experience before—it’s scary enough to stop you from taking your first step forward.
The goal of this blog post is to bring some transparency to what recruiting is like on the other side, when you’re in the wild and completely in charge of your own venture. You may have explored the idea, or you may be actively planning to take the jump from in-house recruiting to entrepreneurial.
As you self-direct your own journey, remember that you’re not alone. Many recruiters have been down this exact road road. We’ve interviewed 5 to share their most valuable tips.
1. Start your business with a unique competitive advantage
Tip nominated by: Louis Flory, President and CEO at EFFEX Management Solutions
In 2007, Flory left a $250K-$300K annual salary to establish his own staffing firm. Today, Flory’s business generates hundreds of millions in revenue annually and has expanded to more than 30 locations in the manufacturing space across the United States. He attributes this success to his company’s unique positioning—he solves a focused challenge for a wide market.
“The staffing industry is flawed in its traditional model and that has led to my passion in creating a new and improved way of doing business,” says Flory.
Flory encourages aspiring staffing entrepreneurs to identify gaps in their target markets. Then, develop a service or process that addresses these gaps head-on. When you develop a focused service for a wide market, you’ll be well-positioned to grow.
“I was passionate about a new staffing firm model that results in a reduction in turnover and an increase in production efficiency,” says Flory.
The best way for Flory to validate his model was to bring it to market and test it.
2. Don’t give up when facing a downturn—adapt instead
Tip nominated by: Kenneth Johnson, President at East Coast Executives
When Kenneth Johnson decided that he would take the jump to become a recruiter, he had commitment from excellent clients, including Vanguard, JP Morgan, and Wilmington Trust. Confident in his company, Johnson set his first day as an entrepreneur to be September 3, 2001. On paper, his business was ready for a bright future—that is, until eight days later, when the September 11 attacks struck New York.
Almost overnight, all of Johnson’s customers pulled out.
“I learned a few lessons in the days after the attack,” says Johnson. “Never place all of your efforts in a singular industry, never give up, and do everything that you can to help others all the time.”
Johnson was forced to ‘pivot’ his business model, before he had a chance to get started. He decided to test a few niche service offerings in the areas of diversity and inclusion. Today, these small ‘tests’ have grown to become core pillars of his business. Johnson and his team consult regularly for organizations like The Urban League of Philadelphia and companies like Tiffany & Co. that are looking for niche expertise in diversity programs.
“Entrepreneurship can be a very rewarding experience while being very humbling as well,” Johnson.
3. Stick to your policies and goals
Tip nominated by: Rachel Charlupski, Founder at The Babysitting Company
Early on in her career as an entrepreneur, Charlupski frequently ‘bent her rules’ to offer free and low cost services as favors to friends and family. After a while, however, she realized that she was losing money.
“Some early lessons that we learned was to stand firm in our rates,” says Charlupski. “At the very beginning, everyone was getting a friends and family discount, and we soon realized we were only discounting our services and value.”
It paid off for Charlupski to stick to her rates and policies. By focusing on customers who could pay her value, she was able to scale her company steadily and sustainably. Rather than catering to a customer base of friends and family, Charlupski now works with sports teams, hotel chains, private homes, and professional associations in several major cities—a dream customer base.
4. Tackle a pain point that you care about
Tip nominated by: William Vanderbloemen, Founder and President at Vanderbloemen Search Group
After spending 15 years as a church employee, Vanderbloemen recognized an opportunity to improve recruiting processes in faith-based organizations.
“I thought that the slow, clunky way we found talent was the only way there was,” says Vanderbloemen.
“I thought it was normal to take 9 months finding a student pastor, or 18-24 months to find a pastor. Then I spent a brief period of time in Human Resources at a Fortune 200 company and watched them find their top staff much more quickly, efficiently, and effectively than any church I'd seen (and I've seen a lot of them).”
In the Fall of 2008, he decided to focus on addressing this pain point. It’s this sense of prioritization and focus that has allowed his company to grow for 26 consecutive quarters and to a team of 30 staff members.
“Everyone told me there was no way I would be successful because I was introducing a new, unfamiliar, and somewhat expensive solution to the church, historically a late adopting market,” says Vanderbloemen. “However, I knew that I could provide a priceless solution to an extreme pain point to a demographic dear to me and my personal values.”
Solve a problem that is valuable to a larger market. If you care about this problem, are passionate about creating a new solution, and empathize with the industry that you’re serving, you’ll be well positioned to grow your business.
5. Consider waiting to take the jump—and when you do, keep working hard
Tip nominated by: Charley Polachi, Managing Partner at Polachi & Company, Inc.
Polachi knew that he wanted to start his own executive search agency, but he wasn’t sure when the timing would be right to take the jump. After finishing his MBA and working for two other executive search firms, he decided that the time was finally right.
“In my opinion, it takes about 5 years to really determine if you’ve mastered your craft enough to branch out on your own,” says Polochi. “Work hard, and after five years, go for it.”
That was in 1983. Today, 32 years later, Polachi’s company continues to operate as a go-to resource for tech companies, private equity groups, and VC firms that are seeking executive level talent.
Despite the success that Polachi has seen, he has never reached a point where he has felt invincible.
“I get up every morning and acknowledge that I am only as good as the last project I closed,” says Polachi. “The moment you think you’re invincible or ‘you’ve arrived’, you’re toast. Keep your humility and keep working hard.”
Entrepreneurship comes with many ups and downs. Even if you love what you do, passion-alone won’t help you succeed. You need to commit to the long-haul and understand that every situation, downturn, or point of frustration can be transformed into an opportunity for growth.
On that concluding note, remember to keep loving what you do. Work will stop feeling like work, and you’ll have more professional options that you ever could have imagined. Hard work and strategic insight may carry you farther than you ever could have imagined.
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