£500 to start an agency?

[dodgy_Dave]

Those of you who have followed my posts will know that I’ve been giving this some thought for quite some time. Starting up on my own has been on the horizon since early 2008, the problem has always been down to a lack of start up capital. Anyway, yesterday a friend of mine suggested that I could do it on just 500 quid, just as he did 5 years ago. Here's his breakdown..

£50 - Logo and corporate branding
£200 - Business Cards, Letterheads, Compliments slips etc
£250 - Basic website with simply CV / Job submission

What do you reckon?

[CrazyMoose]

Originally Posted by dodgy_Dave

Those of you who have followed my posts will know that I’ve been giving this some thought for quite some time. Starting up on my own has been on the horizon since early 2008, the problem has always been down to a lack of start up capital. Anyway, yesterday a friend of mine suggested that I could do it on just 500 quid, just as he did 5 years ago. Here's his breakdown..

£50 - Logo and corporate branding
£200 - Business Cards, Letterheads, Compliments slips etc
£250 - Basic website with simply CV / Job submission

What do you reckon?

Dave, at first glace, these start up costs seem pretty light but I guess you know more than me. Also, I don't want to teach granny to suck eggs or anything but you have you thought about cash flow? If you pay your contractors on a weekly basis but don't receive funds from the client until 30 days you're gonna have to start thinking about debt factoring or something similar until you've built up a reasonable amount of working capital. Just off the top of my head.....

[lurch]

Originally Posted by CrazyMoose

Dave, at first glace, these start up costs seem pretty light but I guess you know more than me. Also, I don't want to teach granny to suck eggs or anything but you have you thought about cash flow? If you pay your contractors on a weekly basis but don't receive funds from the client until 30 days you're gonna have to start thinking about debt factoring or something similar until you've built up a reasonable amount of working capital. Just off the top of my head.....

There is always the option of a factoring company, reduces the margins, but removes much of the cash flow issue, I used to deal with them quite a lot.

I would imagine that in the recruitment game that contacts are your main resource.

[Rob Crossland]

Originally Posted by dodgy_Dave

Those of you who have followed my posts will know that I’ve been giving this some thought for quite some time. Starting up on my own has been on the horizon since early 2008, the problem has always been down to a lack of start up capital. Anyway, yesterday a friend of mine suggested that I could do it on just 500 quid, just as he did 5 years ago. Here's his breakdown..

£50 - Logo and corporate branding
£200 - Business Cards, Letterheads, Compliments slips etc
£250 - Basic website with simply CV / Job submission

What do you reckon?

PI Cover?
Co Formation (you will want limited liability?!?)

I think £2k would be a better budget.

[CliveP]

Originally Posted by Rob Crossland

PI Cover?
Co Formation (you will want limited liability?!?)

I think £2k would be a better budget.

I'd go as far to say that you probably need to double this to £4,000 (minimum). Nobody is going to build you a website for that sort of money, particularly one that needs to attract candidates and / or apply for jobs online. What about a telephone (land line / mobile)?, 0845 number? call answering service? remote office? domain? email setup? web hosting? onsite SEO policy, offsite marketing (online / in print)?

There are lots of hidden costs when starting a business dave. You should knock up a spreadsheet and start documenting / pricing these now.

[curleyted]

I agree with CliveP, I think you'd very quickly get a shock.

[The SMG]

I think you're probably looking in the region of £10lk to start a business nowadays Dave. As CliveP says, there are many hidden costs that all add up to a big chunk of money. Insurance fees will be large (as mentioned by Rob Crossland) regardless of whether you run in-house PAYE payroll or outsource to an umbrella company. Then there's travel costs, stationery, equipment (you'll need a laptop at the very least), hospitality (lunches & meals don't come cheap) and so on. I'm not sure where you are with your planning Dave, but I'd probably be focusing my attention on these 5 before anything else.

* Cash Flow (factoring, overdraft, loan)
* Insurance (Public & Employers, Directors & Officers, Professional Indemnity)
* Banking - find a decent baking partner with good 'real time' systems
* Relationships - start & build up your contractor and client database
* Marketing - find a way of advertising jobs

[CrazyMoose]

Originally Posted by The SMG

I think you're probably looking in the region of £10lk to start a business nowadays Dave. As CliveP says, there are many hidden costs that all add up to a big chunk of money. Insurance fees will be large (as mentioned by Rob Crossland) regardless of whether you run in-house PAYE payroll or outsource to an umbrella company. Then there's travel costs, stationery, equipment (you'll need a laptop at the very least), hospitality (lunches & meals don't come cheap) and so on. I'm not sure where you are with your planning Dave, but I'd probably be focusing my attention on these 5 before anything else.

* Cash Flow (factoring, overdraft, loan)
* Insurance (Public & Employers, Directors & Officers, Professional Indemnity)
* Banking - find a decent baking partner with good 'real time' systems
* Relationships - start & build up your contractor and client database
* Marketing - find a way of advertising jobs

Have you ever setup an agency SMG? You seem to know more than your average contractor

[Pistachio]

£500 isn't much to sell your soul for. Mind you, you are already a recruitment agent I suppose...

[BrilloPad]

An agent I know did it in 1992 with 15k. He took 3 of us out for a curry : wanted 5k each of us. 1 of my friends was very lippy/rude : agent went off in a huff and went elsewhere. Got all the money from 1 chap.

By 1995 he had 30 contractors : was soon taking 500k a year between them!

Probably biggest deal I ever missed out on.