Beginner’s Guide on Starting an Employment Agency in the United Kingdom
The basics on setting up an employment agency business in the UK from the experts at 3E Accounting, the most experienced United Kingdom corporate service provider.
Do you have a knack for pairing the right candidate for the right job? If the answer is a resounding yes, then a recruitment agency may just be the right business idea for you. When looking at starting an employment agency business in the UK, certain aspects need consideration. Here’s a quick read of how to go about it and stay compliant.
Starting an employment agency is an exciting venture that can be quite lucrative when done right. The market segment itself is pretty competitive and contributed GBP42 billion to the economy in 2019. The World Employment Federation’s 2020 report pegs the UK as the third-largest recruitment industry globally and the top in Europe. All good news for anyone looking to start an employment agency business.
As a recruiter, you may need to help in the recruitment of full-time or part-time staff or temporary employees for different industries. You will have to stay abreast of the new rules and regulations and make sure that whatever you do is within the law. Another vital factor in this field is that you must have good connections with the right people. For your business to be successful, you will need to form a network of many loyal customers and new customers. You will need to implement effective marketing strategies to develop good connections with people in the right places.
Develop a Business Plan
The first step to take before starting an employment agency is to write up a smashing business plan. This is a crucial step as having a scalable and well-researched business plan is the lynchpin to success. Consider if your business model will be all-encompassing, a niche market, or maybe even a franchise. Perhaps you would instead handle part-timers and freelancers only.
Do include a credible financial forecast to make it easier to convince investors and funders. As part of this, you will need to work out a pricing structure to make your agency attractive. Industry terminology includes knowing about variable pricing options, such as retained recruitment, rebate option, contingency basis, etc.
You will also need to be aware of the regulations. This industry is regulated by the Employment Agencies Act 1973 and its professional body, the Recruitment and Employment Confederation (REC). You can contact the REC for more information, as well as read its Code of Professional Practice.
Business Registration Process
Next, you will need to choose your business entity. Popular choices include sole traders, limited companies, and partnerships. Each has its pros and cons, and doing some research will help you decide the best structure for you. Firms such as 3E Accounting offer guidance about company registration in UK and assist in writing up well-drafted business plans. They also provide company formation solutions that include registered business addresses, serviced offices, website design, hosting, etc.
Your agency should also keep abreast with technology and trends. Outsourcing is a great new way to keep costs manageable and get crucial work. Human resources, as well as audit services, amongst others, can be outsourced competently. Having a website for your business that is mobile-friendly is also a must. Facilitating accessible online applications, video-call interviews, etc., is the new norm that will make your business more attractive. 3E Accounting’s professional company incorporation services will make the process of starting your employment agency smoother for you.
Licences and Permits Needed for Starting an Employment Agency
Contact the local authorities to know if you need a business license for your recruitment agency. In the UK, employment agencies need a permit when they are supplying workers for specific industries. For instance, they will need a license from the Gangmasters and Labour Abuse Authority for providing workers in industries like food processing and package, horticulture, or agriculture.
If you need to know about starting an employment agency business in the UK seamlessly, get in touch with 3E Accounting. We provide comprehensive and customizable start-up solutions that span the spectrum. Partnering with us will ensure that your business gets all the assistance it needs, specifically for you. Along with our affiliates and partners, we offer international and regional expertise that is simply best in class. Contact 3E Accounting today to take that first step towards innovative business solutions tailor-made especially for you.