As England prepares to lift its latest lockdown measures and enters a new tiered system of local restrictions many in the recruitment sector may have a feeling of déjà vu.
With so much uncertainty, recruiters need to start taking proactive steps now to rebuild and recover their business as we enter 2021.
The last year has been somewhat of a mixed bag for the sector and while some agencies have seen a significant decline in income due to reduced demand for their services, others may have experienced their busiest period yet – especially if they specialise in high-demand industries.
This means that every business’s approach to the year ahead is going to differ and there may not be a one-sized fits all approach. Despite this, there are several basic steps that all recruitment companies can take now to improve their prospects for 2021.
Reflect, review and take stock
The last 12 months have been undeniably tough. Many recruiters will have been focused on the day-to-day issues of their business and probably haven’t had time to sit back and look at their company in detail.
The Christmas break and the start of the new year is an excellent time to dig deeper into your finances and key performance indicators to assess where the strengths and weaknesses lie.
This should help business owners to focus resources and time on the areas that will improve their company, rather than pursuing goals that provide no benefits.
While it is true that the year ahead remains uncertain and things could change, there are some basic issues within many businesses, such as costs, cash flow and liabilities, that are unlikely to change drastically.
Now is the perfect time to accrue data and information about your business, especially if you are already undertaking a review.
This is where forecasting and financial modelling using the latest technology can help. It is well worth the investment in cloud accounting to model different scenarios, so you know what steps and preparation you need to take in advance.
To monitor ongoing performance or issues within your business, it may also be worth getting detailed management accounts produced so you know exactly how the company is performing each month.
These accounts can also be useful if you need to access additional finance or if you decide to sell your business or shares in the next year.
A new approach
If having reviewed your business model and your finances during the last year, and your forecasts for the months ahead, you believe that your business may no longer be viable or profitable it may be time for a new approach.
Those businesses who succeeded most during the pandemic were often the quickest to adapt. Making changes to a business is no simple task, but if the basis of your previous success is no longer there then something must be done.
Change doesn’t have to be wholesale though and there are many small steps that agencies can take to expand their services or branch out into new areas.
It is certainly worth sitting down with a trusted advisor, with the information you have put together, to look at other options for your business if you believe that your current model is no longer viable.
While it may be tempting to just wait and see what 2021 may bring before doing anything, this is not an effective strategy if you want to rebuild your business in the year ahead.
Businesses must take carefully considered action now. This could be as simple as conducting scenario planning or it could mean a complete pivot for your business.
To ensure you have the best plan in place and are taking actions that will help your business to recover it pays to have support and advice from a trusted advisor, such as an accountant.
We are currently working with a wide range of businesses in the recruitment sector and are supporting them by creating plans and strategies for all eventualities.
We work hard to ensure clients not only remain compliant but support them so we can spot opportunities and challenges that may come their way.
To find out more about our services for the recruitment sector, please speak to our specialist team.
This online event will focus on Reclaiming Your Time. Details of this presentation will be available soon by clicking here.