Do you need to find the perfect candidate for your business but don’t know how? Recruitment is a complex world, and the options you face can be overwhelming. There’s a lot of jargon, a lot of methods, and a lot of agencies! Two popular methods are contingency recruitment and retained recruitment.
When it comes to contigency vs retained recruitment, which one do you need? We’ll break down each approach and see which one suits your hiring requirements.
Why use a recruitment agency in the first place?
There are negative connotations around recruitment agencies typically. Some have a bad reputation and sometimes hiring managers and internal talent managers want to avoid them. But good recruitment agencies will make your life so much easier and are a gem to partner with, when you find the right one!
You can forget about hours of trawling through irrelevant CVs and applications, you can forget about candidates ghosting you, and you can forget about wondering if someone has the right skills or will fit into your role.
We get it, agencies aren’t for everyone, but they can help you with:
- Accessing a wider talent pool: The good ones have extensive networks and resources to find qualified candidates. Looking for niche roles or specific skill sets? That’s their everyday.
- Expertise and experience: The good ones have skilled professionals in screening, interviewing, and understanding the current job market, which saves you time!
- Cost-effectiveness: Agency fees can seem high at the time, but they are effective in the long run. How often has a bad hire or an open vacancy cost your project? With the right agency, you can avoid unqualified candidates and bad hires, and ultimately avoid the costs of a poorly resourced project.
What is contingent/contingency recruitment?
First off, there are a few names for it – contingency, non-retained, or success-based recruitment. They all mean the same. The contingency side is that you don’t pay the agency unless a candidate they put forward is successful and stays put for an agreed length of time.
Contingency recruitment does give the employer quite a lot of power in the relationship. If you like, you can work with multiple agencies while your internal team also searches for potential candidates. But, we’d advise you to think about the effects on a candidate experience – are all the agencies representing your business the way you want them to?
There are contingency agencies that hire for most general positions and ones that specialise in particular industries and roles. It’s up to you to decide which one suits you.
Benefits of contingency recruitment
There are two main benefits to choosing contingency recruitment:
- It’s less risky on ROI: You only pay for the people you employ. If you don’t think a candidate is suitable or you found someone through your internal team, you don’t pay a penny.
- It’s time-efficient: Due to the no-win, no-fee nature of it, good agencies will send you the best candidates they can find as quickly as possible. It’s in their interest to fill the role and earn the money.
Disadvantages of contingency recruitment
Understandably, there are some drawbacks to contingency:
- Less focused searches: If multiple agencies and an internal team are involved, you may not receive the dedicated attention your role requires. Are your agreed terms more attractive than the other clients the recruiter works with?
- Quality of candidates: With the aim of filling roles quickly, some agencies may prioritise quantity over quality.
What is retained recruitment?
The essence of retained recruitment is having a dedicated search party basically sourcing a diamond in the rough. It’s a hiring approach that is more focused on quality than speed.
You pay a retainer fee upfront to secure the agency’s exclusive focus of the position. Recruiters then perform a targeted search to find top talent. Working with one agency promotes deeper collaboration and understanding of your ideal candidate.
Retained recruitment is often the preferred method for urgent, high-impact, or executive level positions.
Benefits of retained recruitment
Like anything, there are pros and cons to retained recruitment. Some of the reasons it might be right for you:
- Accessing top talent: Recruiters and agencies have extensive networks and a wider reach, allowing them to include top quality ‘passive’ candidates who aren’t actively searching for a new role.
- Thorough search process: By paying a fee upfront, recruiters can dedicate more time and a deeper look into what you need and who fits the bill. They can also allocate more resources from their wider business to ensure the best possible service.
Disadvantages of retained recruitment
Now for a few of the reasons it might not be your chosen method:
- Risk on ROI: You have to make an investment upfront. This may not be possible or your preference. If you as a business are still undecided if this is a position that definitely needs to be filled, then investing in retained could be a waste of time and money.
- Longer timeframe: A more in-depth search and the perfect candidate can sometimes be hard to find, so it could take slightly longer.
Which method should you choose?
Hopefully, you should now have a bit of an idea of which method to choose, but there are a few more things you may want to consider.
What is the level and skill requirement for the role you’re hiring? If it’s specialist and the priority will be on the quality, retained could be your winner. Whereas for more common positions that have a larger talent pool and you want a cost-effective choice, contingent could be more beneficial.
And in the world of tech, these could change on a role-by-role basis. From targeted headhunting for your new Chief Data Officer to a broader search for a Business Analyst, your requirements may be more flexible.
How can we help you?
Our Troi Search team is deeply experienced in all forms and methods of recruitment, we know which solution suits which requirement and will advise as such. Given all our recruiters have a mixture of internal, embedded, and agency recruitment experience, we have truly seen it all. Troi Search offers all of these services AND MORE!
The team has the perfect blend of an embedded/partnership mindset coupled with the urgency shown by an agency.
