Big is better, says Monster recruit Lacey

If you can't beat them, join them. Though he won't admit it, that is probably why recruitment entrepreneur John Lacey sold his business to the rapacious US owners of Monster.com.

If you can’t beat them, join them.

Though he won’t admit it, that is probably why recruitment entrepreneur John Lacey sold his business to the rapacious US owners of Monster.com. Monster.com owner TMP Worldwide's New Zealand holdings include recruiters Morgan & Banks, Lampen Alectus, Cowles Mitchell Beadon and Methven Personnel.

Of course, the sale could also be related to what Lacey calls the “financial windfall” of “a significant amount” - which industry people estimate only at “some millions” - from which he has since bought a new sports car whose make he won’t disclose.

The London-born graduate engineer has been in IT all his life, the last 15 of which have been in recruitment. But the industry is consolidating, becoming globalised as employers seek to cut costs, yet demand more and more services.

Though Lacey Lee recruitment claims to be profitable and doubling in size every year, with 40 staff in Auckland and Wellington, putting it in the New Zealand IT recruitment industry top three, Lacey felt his firm could not go on as before.

“We are going to see a big shake-up in IT recruitment. Large firms increasingly want consistent and standard service from as few a number of suppliers as possible,” he says. For IT recruiters this means offering secretarial, accounting, management, marketing and other recruitment. Employers will increasingly be based overseas and will make their recruitment decisions offshore, so a global presence is more important, he says. And employers will want assessment tests and other HR services.

“Unless you have the reach, your market will diminish significantly," says Lacey. "All that will be left in IT recruitment will be the small niche supplier and the occasional small-to-medium[-sized] enterprise. Already we are seeing a great number of preferred supplier contracts as firms want consistency."

Becoming part of TMP Worldwide means Lacey Lee can now handle overseas recruitment and a greater variety of HR services, says Lacey, work which would have been passed on before the December takeover.

Lacey moved into recruitment in the mid-80s because he saw the Kiwi recruitment market as having few decent players and much potential for growth. He joined Doughty-Pratt as a consultant, but within six months was a shareholder, eventually owning half the business. The company became the Doughty Group and was bought by Candle in 1996. But two years before then, Lacey sold his shares and on the anniversary of serving his seven month restraint-of-trade agreement, he started Lacey Lee with Peggy Lee and Paul Simpson. They were later replaced by Hugh Riley and Harry Hall.

However, Lacey wonders if he could do it again today. Previously, he says, the recruitment market was one that could be entered cheaply with just an office, but the cost of advertising and delivering more services, such as websites, makes it much more difficult today.

“I wouldn’t set up a recruitment company unless you plan to be a very small player and you had something exceptional to offer,” he says.

Consequently, perhaps, Lacey, in his ealry 40s, says he is committed to TMP Worldwide.

“I am looking forward to being to being part of that larger organisation and sharing capabilities. There is also the excitement of being part of a larger group. But I’m proud of what we [Lacey Lee] achieved in difficult conditions,” he says.

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