Managing Consultants

Hi,
I am looking forward to open a placement consultancy firm in Delhi. KIndy advise me the tips and advise to open and to mangage the consultancy firm including the paperwork required.
Looking forward for valuable advises for you all.
Thanks and regards,
Bindusar Sharma

Hi Bindusar,

You can start a firm or you can do business as an independent recruiter or a registered firm.to register with the services tax and collect it from the client @ 15% on the invoice value (14% ST, 0.5% Swacch Bharath cess, 0.5% Kisan Vikas Cess).

If you are an Independent recruiter and are confident that you will cross Rs.900,000 revenue in the first year the it is advisable

As of today if you want to start a firm (with a firm name) then you have to first get your firm registered even if it is a proprietorship firm. The banks require the firm's registration in order to open a Current account. If you are confident that by the end of a financial year you will cross Rs. 900,000 as revenue then you have to register with the services tax and collect it from the client @ 15% on the invoice value (14% ST, 0.5% Swacch Bharath cess, 0.5% Kisan Vikas Cess).

In case you are having a partner then you can register a partnership firm all others remain the same.

Coming to the business side, you need to have a clear business plan, understanding of the business cycle works among others. The current market rate for hiring is 8.33% (equivalent to 1 month's salary)+ services tax. Reputed and large firms charge even 16.66% of the candidates annual CTC + services tax.

Hope this helps

If you are having to ask us how to open and build a business, then you are not yet ready to do this as it appears that you have not done any planning whatsoever.

Start first with a thorough SWOT analysis of both yourself and the business idea. After that put together a very detailed and comprehensive Business Plan that sets out exactly how the business is going to be set up, what funding you have, how you will operate, how you will market, and where the clients will come from.

From reading CiteHR, it seems that half of India is setting up businesses in HR placement consulting. I have no doubt that there are probably hundreds of placement businesses in Delhi at the moment. That's a lot of competition to fight.

What is going to be different about you and your business?

How are you going to find clients, when all the other outsourcing businesses around you are seeking the same clients?

How are you going to support yourself (and your family if applicable) while you try to establish the business and make it profitable to pay you a salary?

What capital and ongoing finance do you have to start this business, hire and pay staff, rent office accommodation, pay for marketing and advertising etc etc??

How many other similar businesses are there right now in the area around you that you will be competing with?

As a general rule of thumb, you need to work out what your total living expenses are for a year, and put that money to one side. That relieves the pressure to some extent while you try to establish the business. At least you can then maintain a roof over your head, continue to eat, and pay for all your living expenses, though of course, you may need to live more frugally.

Secondly you will need to work out what it is going to cost to set up the business from scratch, then how much money you will need to run the business for at least a year. Very very few businesses ever make any money in the first 12 months, so if you are counting on this generating income as soon as you open the doors, then I seriously advise you to rethink this idea NOW.

We have so many postings here on CiteHR of people who have started their own businesses, and are now desperately seeking clients etc, because the business is failing. I'll guarantee that none of these people did any research first, or made sure they had funds in place to live on.

FAILURE TO PLAN IS PLANNING TO FAIL.

Dear Bindusar,
You have not mentioned, what is your qualification, experience in the field, and your own preparation as a prelude to opening of a consultancy firm. That clealy means you are not yet ripe for the proposed consultancy firm.
Better at first draw your plans, make SWOT analysis of your plan, prepare or get prepared an exhaustive business plan and then consult some capable management consultant before entering in to the profession in order not to get flak and frustration at the very beginning.