How to Start a Manpower Supply Business

Are you looking for starting a manpower supply agency?

If yes, let me bring confidence to your face. This article has everything that will aware you of all the necessities required to make your company a brand in the field of manpower supply.

With a huge boom in the industrial sectors, manpower suppliers are high in demand. Besides industrial sectors, it has several sectors to work on such as security employees or security team which is required almost everywhere.

This article involves what manpower supply business is all about, required license and registration, monetary and non-monetary resources, benefits, cash inflow, and miscellaneous.

What a Manpower Supply Agency Does

A manpower supply agency provides skilled workers or human capital to companies that are looking for temporary or permanent employees.

The agency, continuously, hires new skilled workers and trains the unskilled members to make a high volume of resources.

It is quite struggling for any company to hire new employees with the required skills and talent. However, it is simpler to get the task done directly by contacting an employee outsourcing agency. That’s how a manpower agency comes to the notice and gets its job.

Here is an instance that will enlighten our concept better:

“Suppose you have a famous manpower supply agency in New Delhi. A builder from Bengaluru comes to New Delhi and wants to build an apartment in a 5000 square feet area.

Now, we have two things to notice. First, he does not belong to New Delhi and hardly knows anyone here. Second, he needs a huge volume of labor, skilled worker, and a few contractors.

Imagine, what you suppose he looks for then?

Correct! He will try to find the best manpower supply agencies and being a famous agency, you are the best possible option.”

I hope the example makes clear what a manpower supply business can do. However, we will discuss other broader aspects in this article.

Benefits for Companies to Hire Manpower Suppliers

  • The manpower service supplier is cost-effective for them.
  • They get rid of the complex hiring process of companies.
  • They can focus on the other important tasks.
  • Manpower agencies reduce risks associated with hiring.
  • These agencies are perfect to negotiate salaries on the company’s behalf.
  • Companies get help to be more flexible.
  • By decreasing the major stress, companies increase their productivity.

Before we dive into those aspects, let’s understand the most important license and registration part.

License and Registration Required

1. Contract labour (regulation & abolition) Act: This is an act established by Indian Legislative Authority in the year 1970 which states to prohibit employment in certain circumstances and regulate the working conditions during employment. It is applicable if you are starting your business with 20 plus employees.

Manpower Supply Consultany

You need to obtain proper registration from the Indian Government before you start employing workers.

The complete procedure is as follows:

  • The employer must approach the Registering office with the Application for registration in Form No I and along with the receipt representing payment of the required and prescribed fee.
  • If the application for registration is fulfilled without any issue, the registering officer will register the business and grant the copy of the registered certificate in Form-II.

2. License for contractors: In case, you are a contractor with 20 or more workers, you need to obtain a license for engaging in contract labor working for the agency.

This license will be issued by the authorized licensing officer as per the provision under section 12.

Need a Grant of the license under section 13G

This includes:

  • The contractor of the agency has to request the Licensing Authority along with the application for the grant of a license in Form No-IV.
  • A security amount of Rs.20 has to be deposited at the time of applying for the license.
  • The receipt for the fee paid must be submitted to the licensing officer.
  • The certificate by the principal employer in Form-V states that he employs the applicant as the contractor concerning its establishment.
  • After making necessary investigations, The licensing officer will grant a license in Form VI which can be renewed from time to time.

3. Renewable for the License: The license holder needs to present the application to the licensing authority before 30 days of the expiry date of the license.

4. Register Your company with:

  • Service Tax Department
  • Professional Tax Department
  • Labor Welfare Fund Authority
  • EPF Authority
  • Company’s PAN Card, and
  • A Current Account in any centralized bank.

List of the key roles of a manpower supplier agency

  • To plan human resources (manpower).
  • To research and gather all the knowledge related to the nearby competitors.
  • To enhance skilled worker team.
  • To use all the social media platforms with the best relevant profiles and business pages to gather an online audience.
  • To research the companies nearby to reach them easily for providing them with employees.
  • To market the employer brand so that the companies grow and lead you to grow.
  • Recruiting workforce continuously to avoid being lacking.
    • To evaluate your ups and downs, pros and cons, and profits and losses.

What should be the approach of the agency

  • Giving a quick response to requirements.
  • Appoint an experienced HR Professional Assistance who can help to hire.
  • Optimize your strategies according to the client’s needs.
  • Can join preferred partners to various ministries or organizations.
  • Need to tie ups with the leading consultants.
  • Establishing comprehensive technical, operational, and skilled support.
  • Market yourself within the industry through your online and offline presence.

Required Monetary Resources

The good news, this business doesn’t require much investment and anyone can start this business with low funds.

You require only 10 to 15 K INR for the license.

You just require 15 to 20 K INR for registration.

A current account is needed with a 10 K INR Average Monthly Balance.

Other monetary resources such as office and promotion will need according to your niche.

If you want to start a business and you don’t have funds, you don’t need to worry. Here are some useful links you can click and apply for load for any business.




Start a Manpower Supply Company

Possible Earnings of This Agency

Unlike other business plans, a manpower supply business needs fewer investments and gives a huge profit.

The earnings may vary according to the brand name and the number of employees the agency has. It also doesn’t have one traditional way but multiple ways related to the company’s and employees’ needs.

Such agencies, work in several ways simultaneously work specifically.

Normally, an agency charges 20% of the total earnings of the employee on a daily, monthly, or yearly.

Agency also receives commissions for providing with the employees depending on a temporary or permanent basis.

Let’s understand this with an estimated 20 employees and you get commission daily.

A worker gets Rs. 800 per day, there 20 workers will get Rs. 16000 per day. Therefore 20% of the amount will be Rs. 3200 and you get this per day. The agency can earn more by increasing the number of skilled employees.

Sometimes the agency gets a good commission by referring technically skilled employees. This method provides more profit and lies on less risk.

Ultimately, a manpower supplier business plan gives you profitable earnings in every format.


To run any business and make that a brand, requires lots of strategies, energy, efforts, support, and no doubt investments. If we talk about the business we have been discussing, it doesn’t require much investment and gives you a great profit. You just should follow the step-by-step stages that are discussed above and everything will be going alright! Let me summarise, the most important points to remember are a good skilled workers team (at least 20 workers), proper research of competitors, proper research of the companies you want to send employees, complete license and registrations and so on.

You can write us for more details or if you want us to research any other business plan and write an article on that topic.

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