Growing your recruitment agency: How to build a stronger temp and contract business

Could there be more potential in your temp and contract desk? From opportunities within existing accounts to the support behind each placement, growing your business starts with understanding what could help you move forward.

You already know the demands of temp and contract recruitment. Winning the work, finding the right candidates and keeping assignments running all take time and attention.

As you look to grow, how do you build on what is working and address what might be holding you back?

In a recent Recruitment Smarts session with UK Recruiter’s Louise Triance, QUBA’s Peter O’Donnell (Pete) explored how agencies can develop their temp and contract business and manage the risks along the way.

With seven years in contract recruitment before moving into recruitment finance, Pete understands the questions agencies face. His advice starts with something simple: ask your clients what they need..

Are you asking about every opportunity?

Even when you already supply temps or contractors, your client conversations may not uncover all their requirements.

Pete highlights that agencies sometimes miss contract opportunities simply because they are not asking the question. For consultants who also handle permanent roles, those conversations can naturally return to permanent recruitment.

Make sure clients know you can support both, and ask whether they have temp or contract requirements you could help with.

Those conversations can also help protect relationships you have worked hard to build. During the session, Louise highlighted how a client who goes elsewhere for temporary support may find that the other agency can handle their permanent recruitment too.

Pete agreed that being able to support both helps agencies meet more of their clients’ needs.

Understand where demand could take you next

Knowing your market is just as important when growing a desk as it is when starting one.

Pete explains that temp and contract demand varies by sector. Some markets have fewer contract roles, while others see demand rise and fall with seasonal requirements or changing business conditions.

His advice is to research the market and speak to people who know it.

For agencies offering both permanent and contract recruitment, that understanding can help you respond as clients’ hiring preferences change. Pete notes that when businesses become less willing to commit to permanent staff, they may turn to temporary or contract support instead.

Keep those changes in mind as you consider where to focus your business development.

Give your temp desk the attention it needs

Making contract placements and actively developing a contract desk are different stages of growth.

Pete shared an example of an agency with two directors that picked up a temporary role. One director committed to developing that side of the business, and it went on to become their largest area of activity.

That focus matters. Consultants who have always worked in permanent recruitment can naturally return to the conversations and contacts they know best, even after making contract placements.

Sometimes, Pete explains, the barrier is confidence. If recruiters do not fully understand the market or the processes behind contract recruitment, they may hesitate to pursue more opportunities.

Some recruiters work comfortably across permanent and contract roles. Others benefit from having a separate focus.

Consider whether your current approach gives the desk enough attention, and whether your team has the knowledge and confidence to develop it further.

Keep the administration manageable

Timesheets and invoicing are already part of your working week. As you develop the desk, the processes behind them need to remain manageable.

Pete highlights the importance of having an approach that works for everyone: your contractors, your clients and your agency.

The aim is to support delivery while leaving you time to focus on recruitment and growing the business.

He also points to suitable business insurance and the right arrangements for paying workers. Depending on the placements you make, that may involve umbrella companies or other specialist support.

If your next opportunity involves a type of placement you are less familiar with, speak to people who can help you understand what is needed. Pete encourages conversations with experienced recruitment business owners, funding providers and back-office specialists.

Understand how funding supports your plans

You will already be familiar with the gap between paying workers and receiving client payments.

Pete explains that invoice finance helps bridge that gap. He also notes that agencies with funds available may still choose funding so they can use their cash elsewhere, such as hiring another consultant.

For an agency looking to develop its desk, that is a useful part of the conversation: how does your funding approach support what you want to do next?

Whether you currently use invoice finance or fund placements yourself, understanding the available arrangements can help you consider your options.

Understand the figures behind a growing desk

Temp and contract recruitment can bring more consistent revenue, with invoices raised weekly or monthly depending on the timesheet schedule.

It also increases turnover. Pete points out that worker pay is included in the invoice value, so it is useful to understand what those larger figures represent.

As accounts grow, pay attention to the risks behind them too.

Pete describes relying heavily on one client as having “all your eggs in one basket”. Concentration limits can restrict the funding available against that account, which may affect how much work you can support.

Client creditworthiness matters as well. You may have several invoices outstanding before the first payment is due, while your workers have already been paid.

Pete highlights bad debt protection as an important consideration. Where protection is in place, exceeding an approved credit limit can leave your agency financially exposed if the client becomes insolvent.

Understanding how funding and credit limits apply to your accounts helps you see both the opportunity and the limits around it.

Use the expertise around you

An established desk can still bring new questions, particularly when you take on different types of assignments or explore another market.

Pete encourages agencies to speak to people who can help them understand the arrangements and work through uncertainties.

The session also covered keeping up with legislation and using the support available. Pete explains that QUBA shares information with agencies through its system and has access to internal and external legal support, including help with reviewing terms of business.

You do not need to have every question worked out before starting a conversation. Getting the right information can help you approach your next opportunity with greater confidence.

Could your next placement be overseas?

A client’s requirements may take you beyond the UK.

Pete explains that QUBA supports international placements, including funding in US dollars and euros. While there are different details to consider, he describes the funding model as broadly similar.

He also mentions employer-of-record support among the arrangements agencies may need for international contractors.

If you already have a contract offering and an overseas opportunity comes up, speak to QUBA about what can be supported. It could open up another route to developing your business.

Watch the full session

Where could you take your temp and contract desk next?

Watch Peter O’Donnell and UK Recruiter’s Louise Triance in The temp & contract advantage: Start it. Scale it. Strengthen it. for practical advice and agency examples to help you explore opportunities and support your next stage of growth.

Watch the full online session: https://info.quba.solutions/grow-your-temp-contract-recruitment-agency-quba

At QUBA Solutions, we bring together flexible funding, payroll, intuitive technology and expert back-office support, giving you more time to focus on your clients, candidates and business.

Whether you already work with us or are exploring your options, let’s talk about where you want to take your agency next.