6 Ways to Ace Your Recruitment Business Finances & Management
Written by guest author Bessie Hassan | Money Expert at finder.com.au
Turning your business idea into a reality takes foresight and passion, and it also means being smart with your finances from day dot. The recruitment industry in Australia is highly competitive so you need to jump through hoops not only make sure you stand out from the rest, but also to survive financially.
As a recruitment professional, there are unique costs you need to budget for such as advertising, job posting, networking events, travel, training and development, and much more. To make ends meet, and to realise your revenue targets, you need to make informed choices related to business expenses.
Below are 6 ways you can minimise your business expenses and up your management.
- Compare business finance options carefully.
From advertising to labour costs, there’s a wide range of costs associated with running a recruitment business, so chances are you’ll need to access some kind of finance to cover expenses.
When deciding on a business finance option, think about what type of product will suit your business and borrowing needs. If you travel frequently on business trips, you may want to opt for a business credit card so you can earn frequent flyer points, and earn other rewards like complimentary insurance.
On the flip side, if you’re a small-medium enterprise (SME), a business overdraft may be useful as this allows you to link the overdraft to your business account.
When comparing business loans and products, look at the comparison rate as this reflects the true cost of the loan including interest and fees, such as establishment fees, account-keeping fees, administration fees, and any early termination charges that may apply.
- Throw extra cash towards your loan repayments
Once you’ve taken out a loan or line of credit, you’ll need to make room in your cash flow to service your ongoing repayments. A good strategy to get ahead on your repayments and to fast-track your way out of debt is to round up your repayments.
If your monthly loan repayment is $812, round this up to $850 or even $900. If you put an extra $38 or $88 towards your loan, you’ll service your loan sooner and reduce your interest costs.
Structuring your loan repayment frequency so that you make repayments more often is another money-saving tip for business owners. If you switch to fortnightly repayments instead of monthly, you’ll service your debt sooner.
- Negotiate everything.
Whether it’s office equipment, stationery, indoor plants or furniture, negotiate for a competitive price on all your business expenses. Review the payment terms with your regular suppliers to see if they can offer you a better deal or if they can value-add. Many suppliers or vendors will want to retain your account, so they’ll be likely to accommodate.
Consider negotiating for a lower rental cost with your landlord, especially if you have an office space in the city. Look into the area and find out what office or retail spaces are going for, and if you think you’re being charged too much for rent, let them know.
- Get up to speed with your taxes.
While you should employ the services of an accountant, it’s important that you also understand what expenses you can claim when the taxman comes knocking. Depending on the structure of your recruitment business, you may be able to claim work-related expenses for travel, self-education, phone, tools and equipment. Hold on to receipts for things such as dockets for client lunches and industry networking events.
Speak to an accountant as they’ll help you organise your financial records and statements before the end of the financial year.
- Recruit smart interns.
Advertise for recruitment interns on university and TAFE sites as this is a good way to train and scope for potential (internal) candidates. Platforms like LinkedIn, SEEK, and GradConnection are a good place to start. Bright and motivated students often need to complete work experience and internships as part of their course, so why not hire students to carry out more autonomous tasks, and to bring fresh ideas to your business?
This will boost productivity and help you save on wages (many internships are unpaid). It’s a win-win as both you and the potential employee can test the waters, and it’s an affordable way to do so.
- Invest in quality software.
In a typical day (if there is such thing!), you could be juggling new candidates, posting ads, interviewing 15+ people, sifting through CVs, marketing your services, and more. In the chaos of an industry that is largely people-based, you need software that will organise your workflow.
Programs and applications such as AstutePayroll, Xero, Trello, WordPress, Slack, Google Analytics and JobAdder (of course) can make your life a whole lot easier. Some of these programs and apps require an upfront cost that may seem like a lot, but the value of these programs will repay the initial investment 3 times over and allow your business to prosper.
To give your business authority, become a member of the Recruitment and Consulting Services Association (RCSA) as this will allow you to access industry information and advice. Plus, it offers you greater credibility when marketing your services. The brand equity that this will serve is invaluable.
Starting up your recruitment business takes courage, and if you’ve got the passion, then you’re already halfway there. Take time to review your business finance options, chip away consistently at your business debts, negotiate for better terms on all your accounts, and be an early adopter with industry software and programs and you’ll pave the way for great success.
Image Source: Pexels.