Contingency Agencies vs. Retained Search Firms

Frequently represent individuals seeking placement.

……… Represent Companies/employer only.
Are usually in competition with other similar firms or agencies for the placement. Conduct search assignments on an specific contract basis only.
Professional staff is usually compensated on commission for placements made. Professional staff is usually compensated on salary and bonus with incentives for business development.
Spend time identifying a high volume of candidates for the initial search. Must know client organization and position responsibility/requirements thoroughly before initiating search.
Focus primarily on applicants/candidates actively seeking employment, recruiting is placement oriented. Candidates likely “self-select” opportunities. Recruiting efforts are focused on a targeted range of potential candidates, most are not actively in the job market; recruiting is process and result oriented.
Recruiter works concurrently with a multitude of open job orders. The consultant handles 7-10 assignments at any given time.
With no guarantee of payment for services performed, the recruiter cannot afford to invest much time in a search beyond basic recruiting and submission of resumes. Demand Flow style of recruiting. Search team typically invests 80-160 hours per month per client assignment in recruiting, evaluation, screening and client interaction.
Contingency search requires considerable client human resource involvement in screening, interviewing and evaluating candidates presented. Requires minimal Human Resources and General Management time investment until interview process begins.
Under no obligation to guarantee or produce results due to contingency fee arrangement (paid on placement only). Some firms offer a professional guarantee of candidate success and are committed to thorough and ethical practices and results including an off limits policy (never to recruit a candidate placed).
Fees range from 20-33% of compensation and are paid by company on placement (or shortly thereafter). Flat fee plus reasonable pre-approved expenses and are paid by client.
Decision to pay a fee is usually made by Human Resources and is budgetary motivated. Authorization for search is usually made by company administration and Human Resources Management.

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