Finding the right people to employ is a problem for most businesses. It’s a big problem for those businesses that need highly skilled or specialist workers for example those in the tech industry. Because of this many employers hire external consultants to find and short list suitable candidates. Typically businesses expect to pay fees of between 10% and 30% of the candidates first year salary for permanent staff and you can expect to get 10% to 40% commission on contract staff for the duration of the contract.

As a recruitment consultant you are largely free to work from wherever you like, be that at home, in an office or on the beach. So long as you have access to a landline, mobile and the Internet you can be anywhere. I’ve worked with one recruitment consultant in the past who specialised in recruiting software engineers for the UK tech industry who worked from the garden of his house in France for most of the year.

If you decide to handle contract staff it is typical that the client would pay you and you would pay the contract staff. Contract staff will generally expect to be paid weekly or monthly in arrears but the client is unlikely to pay more often than monthly and may well pay late so make sure you factor into your cashflow forecast the impact that could have on your business. You are also likely to be percieved by some contract staff as “conning” them as many feel that taking in excess of 5% is ripping them off.

It’s a business that requires you to spend extensive time building relationships on the phone, usually from a cold call, so you’ll need be comfortable with that. You’ll also continually face a challenge to your rates as recruitment is a big expense for most companies and they will try to avoid using your services (most tech firms offer their staff a bonus of around £2000 for introducing new staff). Savvy contractors will also attempt to reduce your margins to increase their rate.

To find recruits you’ll need to make use of your industry contacts, job sites such as Jobserve and social/business networking sites such as LinkedIn.

If you enjoy building relationships and are happy working the phones then becoming a recruitment consultant could be the business opportunity for you.

This post is part of a series in my home business ideas week.

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