A business man and woman looking at each other quizzically. How can recruiters justify their ridiculous fee?

How Can Recruiters Justify Charging Such Ridiculous Fees?

People don’t like recruitment consultants – fact. They think recruitment fees are a complete rip off. There are a few possible reasons for this:

  1. The reputation of the recruitment industry is marred by rogue recruiters who are purely motivated by their own financial gains
  2. Many people don’t understand what recruiters actually do to earn their fees

Let’s attempt to try and demystify the cloak and dagger image of this industry and explain the necessary steps involved in finding a business their perfect candidate.

Firstly, let’s consider how most people think the recruitment process works…

  • Post an advert on a job board
  • CVs flood in by email overnight
  • Hiring manager decides on a shortlist
  • Telephone interviews take place
  • Shortlist is whittled down to maybe the top three or four candidates
  • Face to face interviews happen
  • Hiring manager decides who will be the best person to do the job
  • Offer is made to the candidate
  • Candidate accepts offer, signs contract and starts one month later
  • Happy days all round!

If that’s what actually happened in the real world, recruitment consultants wouldn’t exist because there would be no need for them.

Let’s take a look at the reality…

Most hiring managers will attempt the first two steps outlined above without achieving the expected results. They may even repeat the process a few times before they realise that recruitment requires more time and skill than they have available to them.

So, they reluctantly seek to enlist the help of a professional. Even after having a productive call, where a good consultant takes the time to understand the vacancy and needs of the business, the hiring manager still may not appreciate that the expert knowledge of the field we operate within is something that only comes with years of experience.

So what do you actually get for your money?

Understanding Client Needs & Market Positioning

Once terms have been negotiated and agreed with a client, it takes time to fully understand exactly what kind of person they are looking for. This includes the job they will be doing, the skills required, the company culture and their plans for the future. It may involve visits to the premises and extensive market research. Once this information has been gathered, a targeted advert, that will appeal to the kind of candidate the client is looking for, can be written.

Job Board Advertising & CV Databases

Not all job boards are the same. Each has its own specialist niche and appeals to candidates from different backgrounds, at different stages of their career. With no knowledge of how they work, a hiring manager would probably pick whichever was offering the best deal at the time. Subscribing to several specialist job boards with access to CV databases costs thousands of pounds per month.

Headhunting

The best candidates don’t apply for jobs. It takes a skilled recruiter with expert knowledge of the jobs market to work out where to find someone with the skills and experience their client is looking for. Once the ideal candidate has been found, a recruiter then has to use their rapport building skills.

Engaging with non-active job hunters takes time, resource and perseverance. Before a consultant can effectively deliver the benefits of an opportunity, the candidate needs to trust a recruiter enough to want to engage with them. Actually connecting with a candidate in order to have this conversation, when hundreds of other recruiters are trying to do the same, requires the technique, skill and patience of a professional.

Candidate Relationship Management

Trust is as much an issue for candidates as it is for clients. A good candidate will receive probably up to fifty calls per day once they put their CV on a job board. This constant pestering turns candidates off recruiters big time!

Consider the amount of faith a candidate needs to have before they can put their future career in the hands of a recruitment consultant. They need to be confident that whoever they entrust has their best interests at heart and can be relied upon to take actions on their behalf that will move them closer to achieving their ultimate career goals.

Expert Knowledge & Negotiation Skills

A good recruitment consultant is trained to ask probing questions that most people may not be comfortable with. It’s only through asking these difficult questions that a recruitment consultant can properly establish what is important to their candidates, not just to fulfil their current needs but their ambitions for the future. A skilled recruiter will make a candidate feel at ease enough to open up and in depth conversations like this flow effortlessly.

Shared Financial Risk

Even once a CV is submitted to a client and both sides agree that they are a good match for one another, the job is far from done. The candidate may have doubts, their spouse may not agree with their decision, their employer may make them a counter offer or another recruiter may swoop in at the last moment with a more appealing offer. The relationship needs to be managed very carefully until a candidate is fully settled in their new role.

If for whatever reason, things don’t work out, most reputable recruitment consultants will offer a partial refund of their fee. Of course, this is a rare situation for good consultants, who will make every endeavour to ensure that it doesn’t happen.

The entire recruitment process can take up to three months, sometimes even longer. It doesn’t make good business sense for a recruitment consultant to risk doing all that work without being paid a fee. Not to mention the damage it would do to their reputation as a business if things went so badly wrong.

So now that you understand a bit more about the recruitment process, do you consider recruitment consultant fees to be at all ridiculous? We would love to know your thoughts.

If there is anything at all you are unsure of, or any further questions you have, please don’t hesitate to contact us.