A study into the financial performance and value of the UK’s Top 1000 Recruitment Agencies highlights 5 things owners and directors must do in 2014.
- Learn from the successful
- Know the growth areas in the market
- Asses your business value and buying or selling prospects
- Go in search of higher margins
- Monitor those failing in the market and exploit their weaknesses.
David Pattison, senior, analyst, gives his views on the reasons why knowing the answers to these questions will help you improve your competitive advantage in 2014.
1. Learn from the successful
Highlighted in the study are 50 firms that have proven the market is no barrier to success, achieving staggering sales growth and delivering record profits. These firms are getting it right in the market; they are setting the standards for financial performance and anyone in the industry should be inspired by their results and follow their lead.
2. Know where the growth areas in the market are
For anyone wanting to know how to increase their sales, take a look at 50 firms highlighted in the analysis. In a market averaging only 6.5%, these firms are averaging 54% sales increases. These firms are showing the direction the market is going in, they are driving the change, understanding their services. Strategy will be very important in the year ahead.
3. Asses your business value and buying or selling prospects
In a time of change in the market, all business leaders should be keeping an eye on their businesses value, how attractive others view their business and also be open to the possibility that they could make an acquisition. We have identified 270 firms where their value has fallen by a third. Many of these businesses need an injection of capital and you or one of your competitors could well buy them out.
4. Go in search of higher margins
Key to your company’s long term success is good profitability, 50 firms named in the analysis are delivering 12.9% margins, and they are showing that real value can be added in a market. Just to put these firms into context 229 of the 1000 companies are currently making a loss. Understanding how these firms are structured and their business models will prove vital to your future profitability.
5. Monitor those failing in the market and exploit their weaknesses.
The year ahead will not be without causalities, named in the analysis are 156 firms whose risk of failure in 2014 is higher due to their low financial health. Two important lessons can be learned from these firms.
a) Know their weaknesses so you can exploit them the market
b) Understand how the problems started and the weaknesses – so you can avoid the same mistakes.
The full analysis has interrogated the UK largest 1000 Recruitment Agencies and conducted a full commercial and financial analysis of each. Copies of the report can be purchased by calling 01642 626 419 or emailing c.glancey@plimsoll.co.uk
