Decision-making and Democracy in a Recruiting Network

by Veronica Blatt

ballot-boxOver the past couple of weeks, I’ve been working on distributing proxy authorizations to NPA’s voting members for our upcoming annual meeting. It’s a great reminder for me of the member-ownership aspect of our recruiting network. As a member-owned cooperative, NPA is run democratically. Voting members who attend our annual meeting cast their votes in person. Those who are unable to attend assign a proxy to NPA’s secretary/treasurer, who ensures each vote is cast in accordance with that member’s wishes.

During the annual meeting, audited financial statements are reviewed and discussed, elections are held for the Board of Directors, bylaws changes are voted upon, and members have the ability to bring up new business from the floor. Every member firm of our recruiting network has an equal say in how NPA is run, regardless of the size (or success) of each firm. As with any election, members may not be satisfied with the outcome, but they are certainly an integral part of the process.

Last year, NPA members voted to adopt brand-new bylaws. The old bylaws, adopted in 1981, had become out-of-date, and needed to be “modernized” to fit today’s business environment and the global nature of our recruiting network. Already this year, NPA’s Board of Directors is proposing two amendments to the bylaws based on member feedback. The changes will be discussed and debated, and members will vote on whether or not to adopt these changes. Next year, it’s conceivable there will be further revisions.

While it’s tough to get excited about bylaws (unless you’re like me), this process is an important distinction between NPA and other recruiting networks or recruiting franchises. It’s what makes us different from our competitors. Other recruiting organizations are owned by individuals. While members or franchisees may be able to offer feedback about how those organizations are run, they do not generally get to participate in business and financial decisions that may impact their own businesses. By contrast, NPA’s president and staff do not establish policy; we implement the programs, services, and policies developed by our members.

If you are considering joining a recruiting network, is member-ownership important to you? Or are you more comfortable paying someone else to make decisions? There is no wrong answer, but it’s a point that deserves careful consideration. Click the link below for a checklist that helps you compare NPA to other recruiting networks.

button-evaluate-split-placement-networks

 


Recruiting Franchise Opportunities will Benefit from the War for Talent

by Dave Nerz

open signMany say it is a great time to start to start a business and in light of the long-term demographics a recruiting franchise or staffing franchise is a good bet for success. Recruiting and staffing franchises help employers find workers either as full-time company hired employees, as temporary contractors, or as full-time contact employees.

Because of the uncertainty in the economy, many employers are looking for less permanent types of arrangements with employees. They want to pay someone to implement a project, lead a launch or manage a program but want to “rent” employees rather than “owning” them for the long haul. Demographics point to a long-term shortage of talent due to the aging baby-boomer generation leaving the work place and insufficient talent in the pipeline behind them. This is more real in technology, engineering, healthcare and science than it is for service-type jobs. But regardless, if the economy gets moving again, the demand for talent (aka skilled and talented employees) will be overwhelming. It is projected by many to be a “War for Talent” that will play out both locally and across borders and continents. And according to a report by The Bureau of Labor Statistics, the employment services industry is expected to be the United States’ 9th-largest in terms of job-creating industry over the next 10 years.

When I look a the money MRI, Spherion and others are charging for a recruiting franchise, I wonder why more are not going it on their own with the help of a peer group for support. While the turnkey option offered by the big boys is appealing, it also has its own unique risk. Because owners go into to it with a large debt to service, the success must come faster and the profits must be shared with the franchising operator. The success these major operators have is tough to argue with if you are relatively new to the recruiting business.  f you value independence, the recruiting franchise option will be somewhat frustrating as you are really a part of a bigger operation and must do certain things to honor the relationship bought into with the franchisor.

A seasoned recruiter, who knows the tools of recruiting, has a recruitment process, and just wants to strike out independently may value a peer group and some partners to help along the way. Vendors to the industry act as a great support mechanism and can provide ideas and support if a relationship is nurtured with your ATS provider, your accountant, job board partner, etc. Online networks, organized recruiting networks, trade associations and trainers to the industry are all excellent options that, while not fully replacing a recruiting franchise, certainly offer an option to those who want to be more independent.

What kinds of numbers have you heard that a recruiting franchise from a major brand costs in today’s market?

Would you pay the price or start the business independently?

Any resources that are a must for a new independent recruiter?

Recruiting franchise opportunities and the opportunities for starting a staffing business are good. Franchising, while not for everyone, is an option that will prosper in the war for talent.


Recruiting Franchise vs. Recruiting Network – Which one is right for you?

by Veronica Blatt

When hiring is robust, like the cycle we are entering (or are already in, depending on the market), there is high interest in starting a recruiting business. It can be a lucrative and rewarding career; it’s attractive to many former HR and corporate recruiters, and high-producing third-party recruiters who have no equity in their current employment situation may consider going out on their own.

Two of the more common models for starting a recruiting business are purchasing a recruiting franchise, or going it alone with the help of a recruiting network (it’s the old “buy or make” dilemma). If you’re interested in starting a recruiting business, here is a list of key differences between a recruiting franchise and a recruiting network that might be helpful in your decision-making:

Recruiting Franchise Recruiting Network
High start-up costs – purchasing a franchise can cost more than US$50,000 Low start-up costs – you can start your business from your home with a phone and computer
Franchise fees   – a portion (5% or more) of gross REVENUES paid each month Recruiting networks can charge monthly dues, brokerage or commission on placements, both dues and brokerage, or be free
Varying levels of autonomy as a business owner Total autonomy as a business owner
Purchasing a business process and corporate marketing/branding Purchasing access to connections, referrals, and/or trading partners
Software – usually have to purchase and use corporate-mandated system Software – free to choose your own based on what works best for your needs
Prescribed business practices – A franchise must be run according to the corporate model Guidelines and best practices – A recruiting network will offer guidelines and best practices as opposed to a specific business model, with a community of peers to learn from
Lots of training Varying levels of training

Purchasing a recruiting franchise can be a great option for those with a lot of up-front cash who want to follow a corporate model with lots of training. For those with a more entrepreneurial style, an independent business combined with membership in an established recruiting network can offer more freedom and flexibility. Both choices can be successful; the key is to find the one that best fits your needs.