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Contingency, exclusive or retained recruitment?

There are three main types of recruitment strategy in common use - they are discussed below:

CONTINGENT RECRUITMENT

Contingent recruitment (sometimes called non-exclusive) means that the recruiter is competing on the role either with other agencies or indeed the client should the client have advertised the role on a job board or their website etc. The recruiter will only get paid should they successfully fill the role. Working this way is how the recruitment industry got the reputation of “throwing CV’s against a wall”. That’s because this way of working means that the recruiter has to be quick – do a quick database search and get as many CV’s that look OK to the client. The reason that recruiters send all that they have is that they don’t want to risk their competitors sending someone who they have registered on their database. This way of working does not produce the best result for the client.

How can the recruiter produce quality results when they are under so much pressure to move quickly? This is a transactional way of working where not much of a relationship is formed between the parties.

EXCLUSIVE ROLES

Exclusive roles are where the recruiter has the role exclusively; but still only get paid on success. There are huge benefits in working this way over contingent recruitment. Namely that the recruiter has more time to do the exercise properly and as a result the clients get a better quality hire at the end of the process. Interestingly, the recruiters charge you the client no more and in many instances many are willing to discount their fee to get exclusive work.

At Beaumont Wood we produce a client report (usually weekly) detailing exactly which companies and candidates are being considered. It also shows the stage of discussions with those candidates so a client can see at a glance the work underway on their behalf. A transparent, and highly accountable partnership is thus created.

Why not register so you can see a sample report? http://www.beaumontwood.com/online-registration

RETAINED RECRUITMENT

The way recruiters should all be working as professional recruiters, is on a retained basis. This is different to the other ways mentioned above as they get paid a fee for service rather than a fee for success. They get paid for the work they put in, not the end result they achieve. They have the time to do things properly, including headhunting, tapping into passive networks as well as searching through their active candidate database. Typically, the client will pay a percentage of the expected fee up front then another payment when the shortlist is produced; and then the final balance on success. The first payments are not refundable should the client cancel the role. The benefit to you the client in working this way is you get 100% commitment as the recruiter has time to do things properly. It strengthens the relationship as the two parties work together to produce the outcome required.

Imagine this scenario - “You are the fifth agency I have called and I expect you to work this job at 100%” is a familiar threat for many recruiters. Why do they continue to work this way when quality candidates are in such short supply? Even with high levels of unemployment there are very few good candidates for specialist roles. Gone are the days when a recruiter could put a job up on the job board, get plentiful quality response and fill the job quickly and effectively. Now they may not get a single response from advertising so the job has become so much harder. The cost of delivery on roles has gone up as a result as recruiters spend more time working to find a decent short list.

The biggest win by working on a retained basis is that the recruiter has more time to source appropriate candidates which will ultimately mean a better quality result at the end of the process. Clients should note that it costs no more to work with a recruiter this way.

Some recruiters will turn contingent roles away. If they are the fifth agency contacted, then do they really want to risk wasting their time working a job that they may already be too late to fill? One typical response to clients is “What I suggest you do is to evaluate what you get from the other agencies. If you are not happy with the quality of the response then come back to me; and we can discuss how we can work together.”

In this candidate short market, recruiters need a commitment from them before they spend the extra time required to source quality candidates. The market has changed; and contingent recruitment will not produce the quality outcome they need.

Remember that it costs no more than contingent recruitment!

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