Guide to how to be a successful recruitment entrepreneur from ATSCo

Tips from Bill Bottriell, founder of SThree, Les Clark, MD of Glotel, Richard Wilson, founder of Penta Consulting and David Plummer, MD of Parity

A panel of leading recruitment industry entrepreneurs recently shared their thoughts about how they became successful to a packed meeting of the Association of Technology Staffing Companies (ATSCo).

The panel consisted of Bill Bottriell, founder of SThree, Les Clark, MD of Glotel, Richard Wilson, founder of Penta Consulting and David Plummer, Managing Director of Parity.

Bill Bottriell is featured in the Sunday Times Rich List, while SThree is listed in the Sunday Times 100 Best Companies in the UK. Les Clark has just sold Glotel, the company he founded, to Spring Group for 27 million.

Richard Wilsonís Penta Consulting, has won both a Sunday Times Best Companies to Work For Award, and a Queenís Award for Enterprise. David Plummer is founder of Triage, which he sold to Spring in 2002 before joining FTSE listed Parity.

The event, hosted by ATSCo at the Radisson Edwardian Hotel in Central London, was attended by over 70 leading executives from the recruitment industry.

Top Tips for budding recruitment industry entrepreneurs

Cash is king. Maintaining healthy cashflow is a priority, but can be a challenge due to the volatility of contract markets. Recruiters should try to grow healthy permanent business to provide a stable income during the early stages of growth. Relying too heavily on cyclical contract markets at the expense of permanent business had cost many IT staffing companies dearly during the dot com collapse.

Initially stay focused on a niche market. Be wary of growing by buying market share. High volume, low margin business is rarely convertible into high margin business at a later date.

Recruiters are sales people, and should realise their limitations when it comes to imposing financial discipline on a company. Staffing companies should look to bring in people from outside their sector with complimentary skills who will do some of the things salesmen hate ñ such as control costs!

Always try to find value-added services which can be marketed to clients. Penta, for example, is working with a local university to train graduates for a South American telecoms company.

Good consultants are hard to find, but are central to long term competitive advantage. Recruiters should consider how the best staff can be retained as the business grows and motivated by offering benefits such as share options.

It is possible to grow profitably geographically and by sector ñ but beware of growing too quickly and sacrificing profits.

Consider giving your best staff and managers more autonomy and more challenges to deliver. SThree set up a number of business units under different brands and gave them a high level of autonomy. Many of these business units are even allowed to compete with one another.

Be prepared to experiment to see what works best. Glotel, for example, began by employing salespeople from technical backgrounds; then gradually brought in pure salespeople. Successful recruiters have to take risks and be prepared to make changes.