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How Much Does It Cost To Start a Staffing Agency?

Running a successful staffing agency can be an extremely profitable business venture. Before you start your own staffing agency though, it’s important to understand how much you’ll need to invest. 

This article will explore the various startup costs associated with starting a staffing agency and tips for reducing costs wherever possible. Read on if you’re considering starting a staffing agency!


What are the Startup Costs For a Staffing Agency?

The cost to start a staffing agency can vary depending on the size and scope of the business. Startup costs are the expenses that a business incurs when starting up operations. These costs can include:

  • Company registration fees
  • Business insurance
  • Licenses and permits
  • Office space
  • Hiring staff
  • Marketing and branding expenses

Each cost will vary on a few different factors. For example, costs for office space and hiring staff will be higher for a large agency than for a smaller one. Meanwhile, marketing and branding costs vary significantly depending on strategies.

Let’s look at them in more detail.


Staffing Agency Startup Costs: A Breakdown

There are several startup costs that you will need to consider when starting a staffing agency. Some of the most important ones are listed below.

Company Registration

The cost to register your staffing agency will vary depending on the country or state you operate. For example, in the United States, expect to pay between $100 to $800. You will also need to register your company with the appropriate government agencies, such as the IRS and Workers’ Compensation Board.

In order to save on your company registration fees, be sure to look for discounts or cost waivers.

Business Insurance Policies

It is vital to have an insurance policy before starting your staffing agency. A good insurance broker can help you find the best policies for your business. Typical policies include general liability insurance, workers’ compensation insurance, and automobile insurance.

The cost of business insurance will depend on the size and scope of your agency. However, a basic policy will cost around $500 per year. Before you commit to a policy, shop around for the best rates and compare quotes from multiple providers.

Licenses and Permits

Depending on the location of your business, you may need to obtain permits and licenses for your staffing agency to operate legally. For example, in the United States, you may need a permit from the Department of Labor or the Employment Standards Administration. The cost and requirements for licenses and permits vary from location to location, so it is essential to do your research beforehand.

On average, you can expect to pay around $1,000 in licensing and permit fees. You may be able to save if you apply early and check for discounts.

Office Space

If you plan to operate your staffing agency from a physical location, you’ll need to lease or purchase office space. The cost of office space will vary significantly depending on the site and size of the facility. On average, you can expect to pay around $8-$23 per square foot of office space.

Remote working has been on the rise since the early 2000s, with the COVID-19 pandemic in 2020 forcing widespread adoption. Leveraging online communication tools like Slack and Zoom can enable a fully remote office setup. However, expect to pay more for equipment and IT security in a distributed team scenario.


In addition to the costs mentioned above, you will also need to purchase equipment to start your staffing agency. This equipment can include computers, phones, and office furniture. If your team is set up to work remotely, you can save significantly on office furniture.

Services now make it easier to lease equipment like phones and office furniture, which lowers the barrier to getting started. On average, expect to spend around $1,000 on startup equipment per employee.

Hiring Onsite Staff

While you can get started as a team of one, expect to hire employees quickly in order to scale your business. Like other expenses mentioned, the cost of hiring employees will vary depending on the position and level of experience. However, on average, you can expect to pay around $5,000 per team member monthly for staffing costs.

Typically, payroll is the largest expense for a services business. Don’t worry too much about saving on staffing costs. High turnover rates lead to increased hiring costs and harms the client experience. 

Meanwhile, paying top-rate for the most senior employees likely will not provide an exponentially higher return on investment. Consider your goals, team plan, and client persona, not just costs when building your team.

Marketing Costs and Branding

To attract new clients and build a strong brand, you will need to invest in marketing and branding efforts. The cost of these efforts will vary depending on the strategies chosen. However, you can expect to pay around $5,000 per month for marketing and branding expenses.

It’s a good idea to start by outsourcing your marketing and branding efforts. As a small business, it can be more cost-advantageous to work with a freelancer or agency instead of hiring a full-time team member.

An agency can work with you to build out your brand plan and develop cohesive marketing strategies to reach new clients. As you scale, you always have the option of hiring a team member to continue the efforts you’ve started.

Another great way to reduce these costs is by investing in digital marketing. Digital marketing can help you reach clients faster and more efficiently than traditional marketing methods. By targeting potential customers through email campaigns, social media outreach, and search engine optimization, you can generate more leads at a fraction of the cost.

Customer Relationship Management Software and IT Support

To effectively manage your client relationships, you will need customer relationship management (CRM) software. The cost of CRM software will vary depending on the features and size of your contact database. You can get started for free with HubSpot,, ClickUp, and more.

As you add contacts and get ready to conduct more advanced marketing and sales outreach, plan on paying $1,000 on average monthly for advanced CRM software.

Additionally, you will need to budget for IT support costs. Expect to pay for website hosting, email hosting, and data storage fees. The cost of IT support will vary depending on the services chosen. However, on average, you can expect to pay at least $100 per month for IT support. Larger organizations should anticipate costs in the thousands to support more team members.


Try Our Staffing Agency Startup Costs Calculator

Enter your expected startup costs below and then click the “Calculate My Startup Costs” button. We have included estimated/typical startup costs for each category, but feel free to modify our figures to reflect your specific business needs.

Purchasing location
Build out of location (interior and exterior design and construction fees)
Franchise fees
Office equipment
Licenses and permits
Legal fees
Establishing website, logo and social media accounts
Initial marketing expenses and grand launch
Initial supplies
Cost to pay and train staff before opening
First and last month's rent and first month's utilities fees


Start Your Own Staffing Agency

As an entrepreneur starting a staffing agency, it’s essential to be aware of the various startup costs. By understanding these costs and planning accordingly, you can ensure you’re ready for the financial burden of starting a new business.

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