In the first of our ‘Expert Interview’ series, we sat down with Managing Director of Cavana Search, Matt Newman, to discuss his tips for weathering the storm of the pandemic.
“If your market has been negatively impacted, is it possible to grow your niche?”
If your niche has been negatively impacted how can you successfully respond? In my opinion, there are three options.
Stick it out
If you’re a specialist in a certain area & have built deep-rooted relationships, support that market in any way you can to help it recover. This will cement you as a truly trusted niche specialist within that area and also put you in an extremely strong position to capitalize on the bounce-back.
2. Pivot into a different area
There are numerous synergies between various industries & if you were to pivot into a similar industry, you could transfer your expertise & potentially some of your candidate-pool. For example, if you recruit lawyers and new opportunities are at a standstill an area like regulatory affairs in life sciences is a thriving market. Coming out of the pandemic when the economy returns to some normality it may allow you to put recruiters onto both areas and have a larger team.
3. Hit the reset button
This could be your opportunity to start again. To look at the economy as a whole, see which areas are booming, which areas have the fewest competitors & identifying where there is an opportunity in the market. Finding the positives through a difficult time, recessions create entrepreneurship. Take the last recession when Air BnB & Groupon were created, or if you go even further back Disney was created amid the 1929 Great Depression originally to bring happiness to those suffering.
“The general perception is that niche businesses have thrived whereas generalists have struggled through the pandemic, why is this the case?”
Matt Newman: I wouldn’t say that is necessarily the case as it is wholly dependent on what industry your niche is in and how ‘specialist’ a generalist business is.
There are numerous businesses who you could classify as ‘generalists’ who are a series of ‘niche’ teams which cover a range of areas & these businesses have fared well as their diverse portfolio mean some areas have overperformed which has compensated for those in areas which have been negatively impacted by COVID. Although generalist staffing firms who are ‘true generalists’ have struggled as they don’t have the truly in-depth networks and relationships. This can lead to a ‘race to the bottom’ concerning fees.
In my opinion, the key distinction which has defined the success of generalists is whether their recruiters operate in one niche, or whether they recruit across a wide variety of positions and industries.
Regarding niche businesses, if their specialism is in an area of the economy which hasn’t been impacted by COVID, they have generally thrived. Those in areas of the economy which have been effectively put on hold has meant their fee generation has been negatively impacted.
“Which industries are performing the best/worst?”
Matt Newman: As a rule of thumb, if an industry has been locked down and staff are unable to work from home, you’ve struggled. It really is as straightforward as that. The staffing industry places people into jobs and if there aren’t jobs to place people into, there is no staffing industry for that sector. Retail for example, which has quite literally been shut down, has been hit incredibly hard.
Industries that have performed well & thrived are often those who do not need to be ‘on-site’ to work. I have seen many SaaS & cloud-based businesses, who were performing well pre-pandemic, and have continued their upwards trajectory. Also, areas of staffing that are critical to the fight against COVID. The majority of life sciences and healthcare staffing businesses have continued to grow by focusing on roles that can work from home, companies that are attempting to create a vaccine / new drugs and redirecting staff to search for doctors and nurses to work in the ICU’s.
“Is niche the answer to success?”
Obviously! Being deeply embedded into one industry & one discipline within that industry means you will be able to provide expertise & a quality of service to candidates & clients which generalists could never match. The staffing sector has always been relationship-driven and the most effective way for recruiters to build strong relationships is to truly add value to those within an industry & knowledge is the key to that.