Are we headed for a recession? And how to prepare your recruitment or search firm.
All right, so are we having a recession or not? I really wish I could tell you the answer to that. What I will say is things are looking a little shaky, we’ve got Briggsie, we’ve got global trade wars, things aren’t looking as nice as they should in history tell us we’re sort of getting due for something to happen. And if you listen to the public commentators, they are, you know, starting to say some things that are starting to, you know, let us know that we might be in for some signs of trouble. So I think really, it’s not a matter of if it’s when and regardless of whether or not something happens soon as a responsible business owner, somebody who’s trying to grow a business and sustain it for the long term you need to be always preparing yourself for a downturn anyway. So let’s talk a bit about that.
You really want to protect your downside. It’s really easy when times are good to get excited and go, you know, to Nirvana, what could possibly go wrong? Well, things can go wrong, and they do and if you’re not ready, you know it really hit you by surprise. And look, let’s be real about it for a minute it can cost you your house, your business, you know your lifestyle that you’re wanting, and that’s not what we want. So let’s get serious about what you can do to make sure that you’re not vulnerable. Well really the two things are clear we want to cash in, and less cash-out and there are a few main levers that you can pull to do that.
The big three costs in a business are usually marketing and advertising, salary costs, and rent for most recruitment agencies. Now Yours may look a little bit different to that, I don’t know. But I’d be looking at the biggest cost in your business and really understanding what your what those dollars in or bringing you by way of dollars out. So let’s firstly Have a look at marketing and advertising. When I speak to recruitment agency owners, they can tell me exactly you know how many interviews they’ve got out what, you know, their ratios, those sorts of things on people going out for interviews, jobs I feel that month, that kind of thing. Where things get a bit sketchy is when we start to talk about marketing and advertising and the dollars that are going in or the pounds that are going in to bring a result. Its sort of sometimes can just feel like this money pit where the money just keeps going in and the results on the other side of, you know, not so sure. So the first thing is to have a look at what you’re spending on marketing and advertising, what’s working, what’s not, for God’s sake, stop doing what’s not working, or if you can improve it to get better results. That’s another option as well. And also start to think about what it what you can use now but there are so many new ways to drive new business and you know, when people sit there cold calling these, it’s, it’s time-intensive, it’s, it’s it’s costing you a lot of money. In fact, on that point, you absolutely have to factor in the time cost as well.
We want your marketing and advertising to bring you the biggest result for the least amount of time and the least amount of dollars. So the best way to do that is to start to drive one to many marketing start to try to get inbound And measure it only do what works, ditch what doesn’t, and really give immense, immense value to your clients. You know, it’s one thing sort of saying our service is great we’ve been around for, you know, if you add up all our consultants who have been around for 60 years, etc, etc, until your clients have experienced how good you are, and want you to be there for them as a business partner on an ongoing basis, it doesn’t matter what you say on your website, but once I’ve felt that they’ve worked with you, and they like you, they will keep using you. So we want to go one to many, find the people that you really want to work with, and then just deliver them loads and loads of value. And, you know, when thing if things do tighten up, you know, and they do have some jobs because clearly there are still some jobs in a downturn, then they will use you.
The second thing is your employees and this is a hard one because, you know, we care about people. We don’t want to do the wrong thing by our employees. But if you’ve got performers who are kind of in that middle ground, that you know, aren’t doing so well, not doing that badly, but not doing so well and you’re not quite sure what to do, you need to seriously look at whether you can improve or increase their performance because again if the market turns down, their obviously their performance is going to go down. So, you know, think carefully about that. So, you know, that’s a place you need to look really close it and it’s hard, isn’t it? Because, you know, one, and you have people who, you know, maybe they join your business, they, quickly show up as just not being right for the business or recruitment through no fault of their own, or they’re just in the wrong place or the wrong career. And, you know, pretty quickly those people usually leave the high performance, no brainer. We want them in our business, but it’s sometimes it’s the people who were kind of borderline struggling not doing as well as you want them to, you know, it’s hard. Are they going to improve? Are they going to respond to training, or really do they need to go now I can’t tell you the answer to that you need to obviously look at your own team and make those decisions yourself. But if I was running a recruitment agency still today, I’d be looking very, very closely at the performance knowing that, you know, what might be around the corner might be a bit troublesome for them.
And then, of course, the third being cost usually is rent. Now, you might be locked into agreements, you may not you may be working from home, I don’t know. But normally, it’s another big operational cost. So look at, you know, that’s normally the three big ones’s advertising, marketing staff, and rent, you may have other big costs in your business that if you can, you know, squeeze some of it down, that’s going to stop some of the cash coming out the door, which is what we want.
So, in summary, get your advertising and marketing working for you. We want to go wide to the market, give them lots of value, stop spending on things that aren’t working for you. And we’d like to get that value piece humming for you so that you’re getting great clients in. And secondly, if you have a team, look at people whose performance just isn’t up to scratch, and if you’re a solopreneur, maybe it’s time to have a look at your own skills, you know, are you getting retainers? Are you getting exclusive business? Are your clients calling you first? And if not, why not? And you know, maybe it’s time to just tweak your skills a little bit too. And then thirdly, as I said, you know, rent can obviously be another, another big cost as well.
So I promise if you are if you have a business that is strong enough to put cash reserves away, you will be one of the few. I remember last time, you know, 2008 2009 when the world went into a meltdown last time, lots of our competitors just disappeared overnight really quickly. And because what’s that saying, you know, flying too close to the wind, and they’re all sailing too close to the wind, and they just got knocked out in the first round. So we don’t want that to be you if you can put some cash reserves away now. Fantastic. If you can’t, you really need to think about the things I just spoke about really tightening up and making sure that your marketing is working for you that type of thing. And once you start to come out the other side of this, you will be in a really powerful position. And I remember we came out of the last recession with a lot fewer competitors, that, you know, and there were a few fewer clients too, but we ended up doing incredibly well. Afterward, we rode it through it hit really hard, we rode it through, we sort of slowly came out the other side. And that’s what we want to make sure happens to you you’re not caught up in the crossfire of, of any downturn.
Please, if you take nothing more away from this video if you have a business that isn’t quite where it needs to be if it’s going sideways if you’re struggling to get new clients, you know, if you if you’re chasing revenue month to month, you really seriously need to take some time to look on your business and show yourself up for what may or may not come. If it doesn’t, that’s great, you’re prepared, but you’ll still be around afterward to enjoy the fruits of all the hard work that you’ve put into your business already. So if this has left you feeling a little uneasy or not knowing what to do, feel free to reach out and I’d be more than happy to point you in the right direction. So Yeah, look, you know, this is just part of life part of the business. I’m not saying this to shock you or worry you. But for those of you who haven’t experienced a recession before or even those of you who have, but it feels so long ago and you, you know you’re doing well at the moment, it just might be a cautious reminder for you. So look, I hope that is of value to you. And as I say, reach out if I can help you have an awesome week. Bye.