Anyone working in the recruitment industry, particularly those who have started their own firm, will know that business is rarely constant. Rather, it comes in waves, sometimes with substantial peaks and troughs depending on varying levels of demand in various sectors and the current economic state of the geographical area, or areas, that you operate in.
In the modern workforce environment, a way of diversifying your services and building a reliable foundation for growth is through contract recruitment or scaling your contractor book.
Fixed term employment contracts are ideal for employers who may have a large project upcoming that requires a number of people with very specific skills for a short period of time. As such contract recruitment is increasingly an option discussed by small and large companies alike and is already widely used in sectors such as IT and technology, engineering, financial services, digital marketing and advertising, life sciences and the energy industry.
In this blog, we discuss three topics:
Contractor book growth triggers Key drivers to keep new opportunities arising Suppliers and holding them accountable
How to recognise contractor growth triggers
Building stability through the peaks and troughs of the permanent recruitment market using contract recruitment means you need to be set-up and ready to go. It’s fast paced and while handling one or two contractors may be working for you, building these numbers quickly can strain your business operations without appropriate contractor funding and payroll support or time-saving contractor management tools.
Establishing solid foundations, and being set-up for success from the outset prevents surprises and ensures smooth growth without setbacks. The key to contract recruitment and positioning your business for long-term success is adaptability, being able to respond swiftly to changes in demand, seize new opportunities, and pivot your business strategy when necessary.
Recognising growth triggers for your contractor book is essential for staying ahead in such a competitive environment. Here are some pointers of what you can look out for:
- Start building revenue differently. Simply put, there’s no reason not to start placing contractors. It may be slower going at first, if starting from scratch or training up your team, but usually, with the right partners, your contractor book will build up over time into a resilient reocurring revenue stream. It’s also secure, a legacy recruitment consultants leave behind if they do decide to leave you.
- Stay informed about market trends, economic forecasts, and sector-specific developments such as major public infrastructure projects or large-scale initiatives in your region. Economic growth, industry booms, or shifts in demand for certain skill sets or emerging skill sets can signal potential opportunities for increased demand in contractor placements.
- Monitor the pulse of your client base and for signs of big upcoming projects or expansions. Clients embarking on new initiatives or securing major projects often require additional resource capability or capacity. In addition, analyse the data from your systems to find problems you can solve. A client with lots of open perm roles struggling to be filled, could be solved in the medium-term by contractor placements.
- Gear up for expansion outside of the UK. The globally interconnected nature of workforces and companies opens doors for the specialist contract workforce on your books. With the rise in remote working there is ample opportunity to place contractors outside of the UK, with the US specifically showing signs of growth. Plan ahead and work with a partner that can support you across multiple countries and currencies simply, securely and flexibly.
To read more expert advice on how to grow your business even in the most challenging times, check out our blog on navigating the modern recruiter landscape.
Key drivers for growth and to keep new opportunities arising
Contract recruitment and managing contractors does require a different skill set to perm recruitment, yet relationship management is still the foundation for sustained success.
Here we take a look at six key areas of focus for driving new opportunities and resilient contractor book growth.
- Relationship building with your contractors has never been so important. Contractors always have an eye on the next contract and are often the first to know of new opportunities too, so nurturing these connections is crucial. Personalise your communications with them, leveraging calls and face-to-face meetings where possible. Manage your contractors well, build rapport and instil confidence that you are planning for their future.
- Know your industry and clients inside-out, including new project announcements, tender timelines, legislative changes and funding rounds. The simplest information is often the most useful. How many contractors are working at the company? Who else uses contractors? What is the highest number of contractors at peak times? This information helps map the potential with clients and prioritise accordingly!
- Hire and reward the recruiters your business needs. Recruiting experienced talent can be challenging, so consider all possibilities, including hiring fresh talent or recruiting experienced contract recruiters to expedite returns on investment. An experienced contract recruiter can set the tone and lead by example, paving the way for upskilling permanent recruiters and new hires. Remember to create incentives that reward true growth not just step and repeat complacency.
- Prioritise time to focus on revenue generation. Contract recruitment comes with many extra administrative tasks, from IR35 determination to timesheets, payroll and intermediary reporting. They are vitally important for operating securely, you can’t skip these tasks. With the right supplier’s efficient systems and processes you can minimise the impact and focus your time on what matters.
- Maximise the lifetime value of contractors by ensuring timely payroll processing and keeping your contractors satisfied. Ensure you negotiate contracts diligently, addressing uncertainties upfront and most importantly, think about the strategic plan to keep reutilising your contractors and the experience/new skills gained from their placements to grow the value of their contracts over time.
- Mitigate financial risks by having the right funding partner to help you sustain regular high volume contractor payroll with weekly recruiter margin payments to keep your cash flowing. Conducting thorough credit checks on clients and implementing robust debt management strategies also ensures you can focus on cultivating partnerships with clients that facilitate growth from the beginning.
Success in recruitment hinges on strategic foresight, operational excellence, and proactive risk mitigation. For more resources on compliance, risk management, and cash flow optimisation, you can explore our blogs on compliance and risk.
Holding partners and suppliers accountable
For SMEs without the benefit of full-time legal support, it is important to feel you have a relationship of trust in partners and suppliers. Some of the initial steps you can take to establish trust would involve the verification of credentials, asking for customer testimonials, recommendations or case studies, and also ensuring their culture, values and ethics are compatible with those of your business.
You can also implement a Service Level Agreement (SLA) to ensure your partners meet agreed performance metrics and timelines. By challenging subpar performance, you can ensure a resolution can be found through open communication.
As your relationship develops, you can make sure that it continues to meet your satisfaction with a regular assessment of processes in alignment with industry standards and the evolving needs of your business. Holding partners accountable isn't just about protecting your own interests – it's also about nurturing a foundation for sustained joint success.
How can 3R help you grow your contractor book?
Integrating contract recruitment within your agency provides agility and resilience against industry fluctuations. However, amid rapid expansion, your foundational principles must remain steadfast. Prioritise relationship-building, discipline, and trust in partnerships to fortify your agency's framework.
Teaming up with a trusted partner like 3R empowers informed decision-making through precise financial insights, enabling efficient time management and strategic focus on business development. Having a reliable, supportive partner is essential for long-term success, offering not only growth opportunities but also risk mitigation measures.
At 3R, we're committed to being more than just a service provider – we're an extension of your business, dedicated to achieving stable growth and providing unwavering support. With us by your side, you can navigate the complexities of the recruitment industry with confidence, knowing that your interests are safeguarded and those big business decisions are backed up with solid data and expert financial advice.
