Recruitment Insights

Essential tactics for building a successful temp business

June 8, 2023
Essential tactics for building a successful temp and contract business

So, you have decided that a temp and contract desk is the next step for your recruitment business. But are you unsure of precisely where you should start? To make the most of this opportunity, you need the right strategies to deliver excellent solutions to your clients and drive business growth.

This blog offers a deep dive into the key tactics for building a successful temp and contract business. Whether you are starting a new recruitment business or adding temp and contract to a successful perm operation, we will share some key considerations to help you get started.

Find your niche

Niche markets represent specialised sectors of a broader market that meet a particular client need. For a temp and contract recruitment business, filling a niche or gap in the market gives you a competitive edge in three ways:

Client relationships: In a niche market, you can foster deeper, more personalised relationships with clients by catering to their specific needs. These relationships build trust and encourage repeat business.

Differentiation: Operating within a niche can help you stand out from your competition. This distinctiveness comes from a specialised focus, which your target customers may not find elsewhere.

Value proposition: Become an expert in your niche and you can offer a unique value proposition. You can demonstrate an understanding of the unique needs of your clients, allowing you to provide tailored solutions.

Build a network of clients and candidates

Networking is the lifeblood of a successful temp and contract business. It’s more than just accumulating contacts—it’s about fostering relationships that bring mutual benefits over time. Through networking, you can gain deep insights into your clients’ unique needs, establish a pool of competent candidates, and keep pace with industry trends and shifts in demand.

As a recruiter, you need a pool of qualified candidates ready to step into roles as they become available. Nurturing candidate relationships and staying in touch will enable you to achieve this. Maintaining contact with candidates even when there are no immediate roles ensures that you remain top-of-mind when candidates want new opportunities.

Invest in technology

Technology is your ally in building a successful temp and contract business. Crucial tools include Customer Relationship Management (CRM) systems and Applicant Tracking Systems (ATS), which optimise client and candidate management.

CRM allows you to manage interactions with both existing and prospective clients. They track all communication, supporting the nurturing of relationships, identifying opportunities, and monitoring outcomes. The ability to visualise all client interactions at a glance equips your team with the knowledge needed to understand client needs better and provide tailored services.

ATS tools streamline the recruitment process by storing candidate information and automating various recruitment tasks, such as job postings, candidate screenings, and interview scheduling. This efficiency is particularly beneficial in temp and contract recruitment, where you might manage a large pool of candidates to fill positions.

Strategically plan for growth

Strategic planning is essential in fostering sustainable growth for a temp and contract business. This process involves setting clear objectives, understanding market dynamics, and creating a detailed pathway to reach business goals.

The process of scaling a temp and contract business presents both opportunities and challenges. Expansion can lead to increased revenue, enhanced market visibility, and the capacity to cater to a larger client base. However, scaling also introduces challenges such as maintaining service quality, handling an expanding candidate pool, and securing financial stability. Addressing these demands requires strategic insight, adaptability, and a readiness to evolve with changing circumstances.

Leverage a payroll solution designed for temp recruitment

Managing temp payroll comes with its own complexities, given the fluctuating work hours, varying pay rates, and the need to comply with employment laws. As a temp recruiter, you are responsible for meeting obligations as your candidates’ employer; that means compensating them fairly for work completed, putting aside super contributions and withholding tax. There is a lot to get right, and you should consider technology solutions as they can support you by enabling more accurate, efficient and secure processes.

When deciding on a payroll solution, it’s essential to weigh the benefits of building in-house capabilities or outsourcing to a provider. While an in-house setup offers direct control, it demands considerable investment in resources, technology, and compliance training and requires continual updates to stay aligned with regulatory changes. Outsourcing to a trusted temp payroll solution allows you to scale without increasing overhead costs. It provides access to technology, expertise, and compliance, reducing the burden of regulatory changes and enabling you to concentrate on your core business.

Be aware of common risks in temp and contract recruitment

While the temp and contract recruitment sector presents substantial opportunities, it’s not without potential risks and challenges. You need to recognise and understand these difficulties to manage them effectively and ensure sustainable growth of your recruitment business.

One of the primary challenges in this sector is maintaining a constant pool of qualified candidates. As the demand for contract workers fluctuates, there may be periods where supply does not meet demand, or vice versa. This volatility requires effective planning, candidate sourcing strategies, and management systems. Furthermore, the competitive nature of the recruitment industry poses a challenge. Standing out requires a strong value proposition, exceptional customer service, and a clear differentiation strategy.

Additionally, economic fluctuations can influence the demand for temporary workers, leading to periods of uncertainty. Financial planning and business resilience strategies can mitigate these risks. While building a temp and contract recruitment business presents challenges and risks, you can navigate these hurdles effectively with careful planning, strategic decision-making, and risk mitigation strategies.


Building a successful temp and contract recruitment business requires a multi-faceted approach. Every aspect is crucial in your business’ journey, from identifying your niche, networking, and investing in technology to planning for growth and effectively navigating potential risks.

While the path to success in temp and contract recruitment may seem challenging, the rewards of establishing a well-oiled operation can be significant. When building your temp and contract business, remember to consistently evaluate and adapt your strategies in line with industry changes and market dynamics. By putting these tactics into practice, you’re positioning your business for longevity and success in the ever-evolving world of temp and contract recruitment.

APositive can support your journey in building a temp and contract business

One of the challenges when building a temp and contract desk is maintaining cash flow to support business growth. If this is an issue you face, our Invoice Finance solution can support your business as it grows. We understand recruitment businesses’ unique difficulties and can give you access to the funding needed to pay your candidates and staff. So you can focus on scaling your operation without the financial stress.

Our Invoice Finance solution allows you to access the funds tied up in unpaid invoices without the typical wait of 60 to 90 days. You could access your cash the same day you raise your invoices, subject to meeting criteria.

Which APositive product is right for you?
Discover how APositive can help your business grow

The APositive team is made up of recruitment industry experts with decades of experience helping businesses like yours. Get in touch with us today and see how we can make a positive difference.