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Are joint ventures the future of agency growth?

It was Aristotle who first said that the whole is greater than the sum of its parts. Things may have moved on since the Greek philosopher coined the phrase. But today the principle applies equally to the winning collaboration of businesses that flourish as the result of joint ventures.

Chris Clowes managing director at Originem points emphatically to growth through synergy. Having taken a string of employment agencies beyond their critical mass for growth in recent months, he speaks with some authority.

“It’s all about finding the right partner to do business with and then drawing on each other’s strengths to mutual advantage,” he says.

Taking the case in hand he illustrates how employment agencies have added £1.6m of new revenue through joint ventures in the past six months.

“Every week our agency partners are now significantly building their profitability by eliminating their dependency on invoice factoring and expensive umbrella companies.

“There is real strength in the symbiotic relationships that tick many boxes. We have an equal stake in the joint ventures which drives the right behaviour patterns for good business practice. While the open book management means that trust is not an issue.”

Having been shortlisted for Innovation in the Recruiter Awards for Excellence 2014, and been singled out by the Recruitment & Employment Confederation for its groundbreaking work, Originem is no stranger to challenging the norm.

“We have struck a number of deals this year that have seen entrepreneurial agencies launch their own brand payroll business. This enables them to retain a much greater proportion of their profits and build a sustainable new income stream for the future.

“Our expertise is in employment and payroll so we bring our technical know-how to the table. In return our partners bring their contractor base to the venture. A relatively low initial investment then typically builds over £130,000 of extra profit from just 100 contractors,” he says.

Based on the evidence Clowes concludes that reaching critical mass is better achieved when done in partnership. And for agencies that want to grow, stay compliant and retain their independence, joint ventures are the best way forwards.

Call Originem: 0161 713 1730