A temp agency is a business that is responsible for recruiting temporary workers for businesses and organizations. Organizations in need of short-term workers contract temporary work agencies to send them temporary workers, or temps.

Some temp agencies not only just recruit employees for their clients but also help in training the employees to fit into the role that they are being recruited for. It is on record that the staffing, recruiting, and workforce solutions industry that the temp agency is a part of makes a huge contribution to the economy of the United States of America.

They provide jobs and career opportunities for about 14 million employees annually. Despite the fact that temp industry growth has outpaced the overall economic and employment growth in the U.S., it employs only about 2 percent of the U.S. non-farm workforce.

Steps on How to Start a Temp Agency in Texas

  1. Conduct Market Research

The first step in the market research process for your temp agency is to develop market-based research questions in line with your overall business goal and objective.

In this regard, you should source information that will help you maximize your business, information that will help you know what your potential market will be looking out for from a temp agency and also help you operate your temp agency with less stress and of course, build the business to profitability.

a. Who is the Target Market for a Temp Agency in Texas?
  • A group of individuals with a specific background of qualifications and experiences capable of fulfilling a particular recruitment need.
  • Office, clerical and administrative staffing
  • Industrial staffing
  • Healthcare staffing
  • Information technology staffing
  • Engineering and scientific staffing
  • Professional and managerial staffing.
b. Is Temp Agency in Texas a Profitable Business?

Yes, the temp agency industry is quite profitable. The industry revenue is anticipated to increase in 2023 as corporate profit and most industries continue to recover from the COVID-19 pandemic. As a matter of fact, the Office Temp & Temp Agencies industry is expected to increase 3.6 percent in 2023.

c. Are There Existing Niches in the Industry?

Yes, there are existing niches when it comes to the temp agency line of business and some of them are;

  • Office, clerical and administrative staffing
  • Industrial staffing
  • Healthcare staffing
  • Information technology staffing
  • Engineering and scientific staffing
  • Professional and managerial staffing.
d. Who are the Major Competitors in Texas?
  • Burnett Specialists Staffing & Recruiting
  • Murray Resources
  • The A List Staffing
  • Austin Staffing, Inc.
  • Infinity Staffing Solutions, LLC
  • PDQ Staffing
  • Staffing Texas, LLC
  • CornerStone Staffing
  • Burnett’s Staffing
  • The InSource Group
  • Texas Staffing Pros LLC
  • Frontline Source Group
  • Results Staffing
  • RPC Staffing
  • VSSI LLC Staffing Services
  • Trinity Staffing Services
  • PrideStaff
  • Professional Alternatives
  • Stride Staffing
  • TPI Staffing Inc.
e. Are There County or State Regulations or Zoning Laws for Temp Agencies in Texas?

No, there are no county or state regulations and zoning laws for temp agencies in Texas, but players in this industry are expected to work with the existing regulations governing such business in the county where their business is domiciled.

f. Is There a Franchise for Temp Agency?

No, there are no franchise opportunities for a temp agency business.

g. What Do You Need to Start a Temp Agency in Texas?
  • A Feasibility Report
  • Business and Marketing Plans
  • Business Licenses and Permits
  • A Good Office facility
  • EIN (Employer Identification Number)/Federal Tax ID Number.
  • A Corporate Bank Account
  • Office Equipment
  • Employees
  • Startup Capital
  1. Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.

Some of the catchy business name ideas suitable for a temp agency business are;

Creative Temp Agency Business Name ideas

  • Plano Workforce© Temp Agency, Inc.
  • El Paso® Temp Agency, LLC
  • JK Blossom© Temp Agency, Inc.
  • San Anthonio® Temp Agency, Inc.
  • MacArthur Recruiter™ Temp Agency, Inc.
  • Blue Strides™ Temp Agency, LLC.
  • Remi Landrum© Temp Agency, LLC
  • Grand Prairie® Temp Agency, Inc.
  • Quick Job© Temp Agency, Inc.
  • Stanley Morgan© Temp Agency, Inc.
  • Jonathan Dustin® Temp Agency, LLC
  • Joy Ricky® Temp Agency, LLC
  • Cynthia Martins™ Temp Agency, LLC
  • Corpus Christi© Temp Agency, Inc.
  • Fort Worth® Temp Agency, Inc.
  • Chris Kennedy™ Temp Agency, Inc.
  • F Billy™ Temp Agency, Inc.
  • Andriel Sam© Temp Agency, Inc.
  • Jessica Pope® Temp Agency, LLC
  • King George™ Temp Agency, Inc.
  1. Register Your Business

a. What Type of Business Structure is Best for a Temp Agency in Texas?

Despite the fact that there are several options when it comes to the business structure of a temp agency, the one most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.

Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC
  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.
c. What Type of License is Needed to Start Temp Agency in Texas?
  • General Business License
  • Zonal Permits
  • Signage Permit
  • Operational State Facility Inspections
d. What Type of Certification is Needed to Start a Temp Agency in Texas?

You don’t need any certifications to start a temp agency.

e. What Documents are Needed to Start a Temp Agency in Texas?
  • DBA
  • EIN
  • Business and liability insurance
  • Federal Tax Payer’s ID
  • State Permit and Building Approval
  • Certificate of Incorporation
  • Business License
  • Business Plan
  • Employment Agreement (offer letters)
  • Operating Agreement for LLCs
  • Insurance Policy
  • Online Terms of Use
  • Online Privacy Policy Document
  • Contract Document
  • Company Bylaws
  • Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting a temp agency in Texas, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

  1. Cost Analysis and Budgeting

a. How Much Does It Cost to Start Temp Agency in Texas?

The cost required to start a temp agency may vary significantly, but on average, you can budget between $5,000 to over $100,000 to start your temp agency in Texas.

b. What are the Cost Involved in Starting a Temp Agency in Texas
  • The total fee for registering the business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services – $1,200.
  • Marketing promotion expenses – $1,200
  • The cost for hiring a business consultant (writing of business plans inclusive) – $2,500.
  • Insurance (general liability, workers’ compensation, and property casualty) coverage at a total premium – $2,400.
  • The cost of accounting software, CRM software, and payroll software – $1,500
  • The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of – $25,600.
  • The cost for facility remodeling – $5,000.
  • Other start-up expenses including stationery – $500
  • Phone and utility deposits will cost – ($2,500)
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $20,000
  • The cost for store equipment (cash register, security, ventilation, signage) – $3,150
  • The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – $8,000.
  • The cost of launching an official website – $600
  • Miscellaneous – $2,500
c. What Factors Determine the Cost of Starting a Temp Agency in Texas?
  • The size of the temp agency
  • The choice of location
  • The required licenses and permits
  • The type of facility
  • The type of additional service offerings
  • The cost for branding, promotion, and marketing of the temp agency
  • The cost for furnishing and equipping the temp agency office facility
  • The cost of the insurance policy covers
  • The cost of registering the business
  • Cost of recruiting and training your staff
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

Actually, it is not compulsory to build a new facility for your temp agency, but if you have the required finance, it will pay you to build your own facility. The truth is that building or reconstructing a facility will help you come up with a facility that will perfectly fit into your overall business goals and vision.

e. What are the Ongoing Expenses of a Temp Agency in Texas?
  • Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
  • Transportation
  • Salaries of employees and models
f. What is the Average Salary of your Staff?
  • Chief Executive Officer – $52,000 Per Year
  • Admin and HR Manager – $35,000 Per Year
  • Recruiting Consultants – $32,000 Per Year
  • Marketing and Sales Executive $30,000 Per Year
  • Accountant – $30,000 Per Year
  • Customer Care Executive / Front Desk Officer – $28,000 Per Year
g. How Do You Get Funding to Start a Temp Agency
  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for a loan from your bank/banks
  • Source for soft loans from your family members and friends.
  1. Write a Business Plan

a. Executive Summary

Fort Worth™ Temp Agency, Inc. is a Texas-based temp agency that will be located in Fort Worth, Texas. We have been able to secure a standard and well-positioned office facility in a central business district in Fort Worth. We are set to compete in the highly competitive temp agency industry not only in the Texas market but also in the United States market.

Fort Worth™ Temp Agency, Inc. will work with a group of individuals with a specific background of qualifications and experiences capable of fulfilling a particular recruitment need and also companies who need temp staff regularly.

b. Products and Service
  • Domestic staffing (cleaners, janitors, house helps, maids and drivers et al)
  • Office, clerical and administrative staffing
  • Industrial staffing
  • Healthcare staffing
  • Information technology staffing
  • Engineering and scientific staffing
  • Professional and managerial staffing.
c. Mission Statement

Our mission is to provide professional temp recruitment and training services that assist businesses in operating sustainably.

Vision Statement

Our vision is to become the leading temp agency in Texas.

d. Goals and Objectives

The goals and objectives of a temp agency are to help organizations recruit the right temp staff for their organization, and businesses.

e. Organizational Structure
  • Chief Executive Officer
  • Admin and HR Manager
  • Recruiting Consultant
  • Marketing and Sales Executive
  • Accountant
  • Customer Care Executive/Front Desk Officer

Marketing Plan

a. SWOT Analysis
  • Ideal location for the temp agency
  • Highly experienced and qualified employees and management
  • Access to a pool of skilled and unskilled job applicants
  • Robust company profile.
  • Financial constraints may restrict the publicity and branding of the business
  • A new business that will be competing with well-established temp agencies and franchises in the city
  • Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.
  • Rising number of job applicants.
  • Online market, new services, new technology, and of course the starting of new markets.
  • Changes in the attitudes and willingness of employees to work temporarily can increase or decrease the number of available workers
  • The arrival of a new temp agency within our market space
  • Low demand during the pandemic will reduce industry profitability
  • Economic uncertainty
  • Liability problems
  • The government could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
b. How Do Temp Agencies Make Money?

Temp agencies make money (commissions) by recruiting for businesses and organizations.

c. Payment Options
  • Payment via bank transfer
  • Payment with cash
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
d. Sales & Advertising Strategies
  • Introduce your temp agency by sending introductory letters alongside your brochure to businesses, corporate organizations, and other key stakeholders throughout the city where your temp agency is located.
  • Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, and LinkedIn to get your message across
  • Create a basic website for your business so as to give your business an online presence
  • Directly market your products.
  • Join local temp agency associations for industry trends and tips
  • Advertise our business in community-based newspapers, local TV and radio stations
  • List your business on yellow pages ads (local directories)
  • Encourage the use of word-of-mouth marketing (referrals)

Financial Projection

a. How Much Should You Charge for your Product/Service?

Temp agencies typically charge 25% to 100% of the hired employee’s wages within the first month.

b. How Much Profit Do Temp Agency Owners Make a Year in Texas?

It depends, but available reports show that on average a small to medium-sized temp agency can earn anywhere from $50,000 to $100,000 and more in personal income.

c. What Factors Determine the Amount of Profit to Be Made?
  • The capacity of the temp agency
  • The types of services offered
  • The location the temp agency is covering
  • The management style of the temp agency
  • The business approach of the temp agency
  • The advertising and marketing strategies adopted by the temp agency
  • The number of years the temp agency is in business
d. What is the Profit Margin of a Temp Agency Product/Service?

The profit margin of a temp agency is not fixed; to a large extent, it will depend on some factors that are unique to the service you are offering and of course the commission attached to the services.

e. What is the Sales Forecast?

Below is the sales forecast for a temp agency. It is based on the location of the business and other factors as it relates to such startups in Texas;

  • First Fiscal Year: $320,000
  • Second Fiscal Year: $390,000
  • Third Fiscal Year: $440,000
  1. Set Up your Office

a. How Do You Choose a Perfect Location for a Temp Agency in Texas?
  • The demography of the location especially as it relates to job applicants
  • The demand for the services offered by temp agencies in the location
  • The recruiting capacity of businesses and organizations in the location
  • Accessibility of the location
  • The number of temp agencies in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al
b. What City is Best to Start a Temp Agency in Texas?
  • Fort Worth, Texas
  • El Paso, Texas
  • Arlington, Texas
  • Corpus Christi, Texas
  • Grand Prairie, Texas
  • North Richland Hills, Texas
  • Houston, Texas
  • San Antonio, Texas
  • Dallas, Texas
  • Austin, Texas.
c. What Equipment is Needed to Operate a Temp Agency?
  • CRM and temp software
  • Booking software
  • Computers and laptops
  • Printers
  • Telephone
  1. Hire Employees

When it comes to hiring employees for a standard temp agency, you should make plans to hire a competent chief executive officer (you can occupy this position), human resource and admin manager, accountant, temp consultants, and call center agents.

  1. Launch the Business Proper

In recent times, no temp agency opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party.

The bottom line is that with a proper launching of the temp agency, you will officially inform people in your city that your temp agency is open for business.

a. What Makes a Temp Agency Successful?
  • Choose a good location and office facility to launch the business
  • Make sure your partner with key stakeholders and offer a wide range of temp-related services
  • Be deliberate with your marketing sales approach
  • Encourage the use of word of mouth to promote your temp agency
  • Leverage all available online and offline platforms to promote your temp agency
b. What Happens During a Typical Day at a Temp Agency?
  • The office is open for the day’s work
  • The walk-in areas, chairs, and tables are properly arranged
  • Screening of applicants is done
  • Training and orientation are done
  • Successful applicants are sent to companies as required
  • Reports are written and submitted to superior officers
  • The business is closed for the day.
c. What Skills and Experience Do You Need to Build Temp Agency?
  • Excellent talent hunting and management skills
  • Excellent customer services skills
  • Excellent organizational skills
  • Interpersonal skill
  • Accounting and bookkeeping skills
  • Business management skills
  • Bargaining skill
  • Work experience in a temp agency
  • Experience in managing people
  • Experience in business administration.