Different recruitment models can be hard to understand. Between retainers, search fees, and contracts, it can be hard to keep track of who’s charging what dollar amounts for which services.

In this blog, we break down how three common models work, and the pros and cons of each.

Different Recruitment Models: Contingent Firms

Out of many different recruitment models, contingency is one of the most common. In a nutshell, a contingency model means you pay a percentage of a new hire’s base salary when the hire is made. Typically, these fees range from 20-30% of the candidate’s annual salary.

One advantage is that you typically don’t have to pay any fees until a hire is made.

On the other hand, that means the recruiting company isn’t making ANY money until they’ve made a hire…which means they’ll typically prioritize making the fastest, easiest hire they can. This can seriously undermine quality of hire, as the fastest hire is rarely the best hire.

If you want to emphasize quality, you may want to look for a different recruitment model.

Different Recruitment Model: Retained Search

One different recruitment model is retained search. This model is especially common when it comes to executive search and other senior level positions.

With a retained search model, you pay an upfront fee before the search starts, another fee when a hire is made, and a final fee when the candidate after the candidate has stayed with the company for a certain period of time.

Altogether, these fees typically total about 30% of a candidate’s annual base salary.

This puts less pressure on the recruiter to make a fast hire, but the same flaw is there. The longer a search continues, the less profitable the company is. Therefore, there’s still pressure to make hires fast and potentially sacrifice quality of hire in the process.

Additionally, the fees for retained search can be quite expensive. You may have to pay tens of thousands of dollars upfront to retain a firm’s services. This can be a liability if you end up switching plans or need to abandon the search for whatever reason. That fee is a sunk cost that cannot be reclaimed.

For these reasons, you may be interested in pursuing different recruitment models.

Different Recruitment Models: Hourly Search

Here at Qualigence, we use yet another different recruitment model – the hourly search. Instead of charging fees or retainers, we charge clients a flat hourly rate for every hour we spend on their search.

As our client, you pay as you go and can stop or start the search at any time. There’s no expensive start-up costs or hidden fees, just a fair hourly rate that covers our time and expertise.

Best of all, it allows us to remain profitable no matter how long your search takes. Our hourly model allows us to focus on quality above all else, as well as offer greater transparency to candidates and clients alike. The result is better hires at fair rates.

So Which Model is Right for You?

At the end of the day, it’s up to you to decide which different recruitment model is best for your company. Some companies may prefer a model prioritizing speed, while others may be more focused on cost-efficiency or quality of hire.

The key to remember is that each model will affect the quality, speed and cost of your hiring. Make your pick accordingly!

Click here to schedule a no-obligation call and learn more about how our hourly model helps you make better hires faster.