7 Ways to Increase Your Recruiting Firm Valuation

by Veronica Blatt

golden-eggAs the Associate Director of Membership for a global recruiters network, I see split placements being made every day. With each recruiter taking home 47.5% of the client fee, it adds up quickly – and for most of our members, it’s more like “icing on the cake” for the profitability of their business. So, it goes without saying that recruiting can be a very lucrative business, but what happens when you decide you want to retire? How do you ensure that your independent recruiting firm has a resale value that amounts to more than your unpredictable client list?

Add contract work – Active contracts are guaranteed revenue for your business and can be valued and purchased outright. Obviously, this is more tangible than working on a contingent basis.

Expand your client base – If 70% of your business comes from one client and that client decides to move to another recruiting firm, your business will be significantly devalued.

Specialize – Once your specific niche is defined, figure out how to grow it. You want to be the “go-to” firm for executive placements in your specialized niche. Your team should experts  and this knowledge will give them an edge with clients and prospects.

Create business procedures – Create standard business procedures and document them. It is valuable information, especially if they are efficient and help make your firm successful.

Use a unique business name – Avoid naming the firm after yourself, e.g. “Smith Global Services.” Chances are the party interested in purchasing doesn’t have the last name Smith.

Try (as much as possible) to avoid turn-over – If your top producer decides to stick with the firm through the sale, they are a big asset and valuable to the bottom line.

Purchase real estate – It goes without saying, but owning the building or space where your business is operated will significantly increase the sale price. Even if the building is not being purchased, it’s an asset that can be sold seperately.

Disclaimer: I’m not a black, blue, or even green level expert in this area. Most of what I’ve included might already in your exit strategy, but it never hurts to continually re-evaluate based on the current economic and industry conditions. The bottom line is – your business is worth what someone is willing to pay for it.

What are you doing in your global recruiting firm to ensure a high business valuation?

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HR: An Independent Recruiter’s Friend or Foe?

by Veronica Blatt

I was reading one of my favorite blogs the other day, Fistful of Talent, and came across this post by Andy Porter, The 5 Reasons Why Most RECRUITERS Hate HR. Which got me to thinking there are probably MORE than five reasons. It’s no secret that the relationship between HR and independent recruiters is often contentious.

Andy’s got a pretty good list of reasons, especially when he talks about how HR sometimes uses recruiters as the scapegoat for their own inaction. I’d like to expand on that point. Read the rest of this entry »


Tools for Global Recruiting: Viadeo

by Veronica Blatt

I tend to write about social media and social connection, and today, I will not fail you. Last week Marcia, in our office, discovered a new social media tool called Viadeo, a Paris based professional networking website with members who are looking to increase their business opportunities, enhance their visibility and online reputation and develop their network of professional contacts, according to their CrunchBase profile. It looks very similar to LinkedIn but I signed up, created a profile, and did some searching to see what it’s all about. Because time is of the essence for independent recruiters, I’ve included some information about Viadeo below. According to my minimal research, here is what I know: Read the rest of this entry »


Global Recruiting Opportunities for Independent Recruiters

by Terri Piersma

We’ve all heard a talent shortage exists. However, do the shortages vary around the world? A 2011 Survey by Manpower answers that question. In January 2011, 39,641 employer interviews were conducted either by telephone or collected online in three areas of the world – the Americas, in Asia Pacific, and in Europe, the Middle East, and Africa (EMEA). My post today will provide an overview of the findings. I encourage you to review the survey results in more detail. Read the rest of this entry »


Drinking Beer and Headhunting

by Veronica Blatt

image of beerToday’s installment was submitted by Jeff McGraw of The Callos Companies in Pittsburgh, Pennsylvania. Jeff serves as the secretary/treasurer of NPA’s Board of Directors, and has been a member of the network since 1994. The Callos Companies provides a broad range of human resource services including recruiting & search, outplacement, temporary staffing, executive coaching, employee leasing, and travel medical professionals.

The six Jivaro Indian tribes are spread out across the Oriente of Ecuador. These native South Americans are notorious for three things: headhunting, beer drinking, and resisting the encroachment of the outside world.

Obviously, beer was an important part of the Jivaro life. So this one fact prodded me to learn more about this tribe and even further ponder “what is the correlation between drinking beer and headhunting.”

There are more similarities than one would think.

The Jivaros are the only tribe known to have successfully revolted against the Spanish Empire and to have been able to thwart all subsequent attempts by the Spaniards to conquer them. They have withstood armies of gold-seeking Incas and defied the bravery of the early conquistadors. The Jivaro Indians are known to be an intensely warlike group, tremendously protective of their freedom and unwilling to subordinate themselves to other authorities.

As independent recruiter headhunters, we too, in some way, have revolted from the mainstream and have been able to prevent attempts from competitive threats to conquer us and put us out of business. We have withstood threats from armies of job boards, managed service providers and in-house recruiters. And as recruiter – headhunters we protect our freedom to work independently and to limit our subordination to authority.

Protecting our independent recruiting business from outside threats while maintaining our business and at the same time meeting our client’s staffing needs in a timely fashion with the highest quality candidates can be an awesome task. However my firm and I have found a weapon of choice to stave off these threats. Being a part of a split placement network has given us the edge to remain independent and to compete at a higher level.

A recruiting split-placement network is typically a group of independent recruiters who share candidates and job orders in order to meet their client’s needs. These recruiter networks also enables its members to better serve their clients with an expanded geographic reach, greater access to industry specialization and access to more candidates (and job orders). Some networks provide a worldwide association of recruiters which can provide a global reach for smaller firms.

Looking back at the Jivaro tribe it was estimated that an adult Jivaro male consumed three to four gallons of beer in one day. I certainly would not advocate drinking four gallons of beer but I do highly recommend joining a global split placement recruiter network.

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Recruiting Specialization: Risky or Smart Business?

by Dave Nerz

The recruiting trainers preach recruiting specialization. The more you become an expert in a particular specialty niche, the less likely that you will become irrelevant to the customers you serve. The concept I have heard is pick an area of specialty that is one inch wide, then learn it and work it a mile deep. Sounds like good advice, but it also is not without risk. Read the rest of this entry »


Split Placements: Are You Your Own Worst Enemy?

by Veronica Blatt

When it comes to making split placements, are you your own worst enemy? Let me give an example.

One of our members (I’ll call him Tony) shared a frustrating experience about split placements. He saw a job opening from another member. Turns out both of these recruiters work with this same client, but Tony didn’t happen to get the job order this time. But that’s OK, because he likes to make split placements, so he’s more than happy to supply candidates. He wants a happy client. Read the rest of this entry »


Are Independent Recruiters Digital Omnivores?

by Terri Piersma

How can global recruiters provide local candidates?

by Veronica Blatt

Almost a year ago, I blogged about a possible new global recruiting trend emerging regarding a preference for local candidates over ex-pats. Today, I read another report that seems to confirm the trend in Asia: Western ex-pats are no longer the “most desired” candidates for management positions.

Companies want to hire managers who have a deep understanding of the local cultural norms. In most cases, that means Asian natives who have been US- or European-educated. According to the article I referenced above, both Spencer Stuart and Korn/Ferry acknowledge that these highly desirable candidates are difficult to attract and retain. Read the rest of this entry »


The future of recruiting is doomed?

by Dave Nerz

19079396Let me share a few headlines from some articles that are predicting the future of recruiting…

  • Job Boards Will Replace Recruiters
  • LinkedIn and Facebook Will Replace Job Boards
  • Why Facebook will Destroy LinkedIn
  • LinkedIn and Facebook to Face Challenge from Google+

OK, I’m confused. If we were to believe every headline, it seems like the recruiting business is doomed to be replaced. It also seems that anyone that becomes the next best thing will be replaced by another next best thing! Read the rest of this entry »


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