The end of the year and the beginning of a new year are typically slow for independent recruiters. This means now is the perfect time to reflect on what happened in 2011 and create your plan to increase recruiter revenue in 2012. Industry consultants for the recruiting industry offer suggestions on how to develop a plan to achieve the goals you set. This article focuses on three ways that recruiters, including those involved in global recruiting, may increase recruitment revenue in 2012. The purpose of this list is to inspire independent recruiters to work with clients and candidates in 2012 in new ways.
1. Container Recruitment
While different versions of this type of recruitment exist, typically a recruiter will receive $7,500 to $10,000 before the search begins. Of course, this upfront fee amount will vary depending upon the salary range of the open position. This portion of the fee is non-refundable and subtracted from the final fee payment after a candidate is hired.
This type of fee option is different than obtaining an engagement fee upfront. With this option, the recruiter changes the scope of the services provided to the employer. It is a hybrid fee option that adds retainer elements to a contingency model. It positions the recruiter as a professional service provider for an employer, similar to the relationship an employer has with an accountant or attorney.
A recruiter with this type of fee arrangement will invest more time in the research phase of recruiting than recruiters with a contingency recruitment agreement. Independent recruiters with their own firm, either where they work alone or have a small staff, do not have the time to invest in research for a candidate if an employer isn’t willing to make a commitment to the candidate search by paying a partial fee upfront.
2. Split Fee Placements
Are you currently making split fee placements? If not, you may want to consider this option as a way to better serve your clients and candidates. Isn’t 50% of a fee better than no fee? Independent recruiters who make split fee placements serve their clients better than those who don’t by being able to increase the pool of candidates in their niche by working with other recruiters. In addition, they ask for and fill positions located on other continents because they are confident their trading partners will be able to assist them. On the candidate side, a recruiter making split fee placements is able to provide more opportunities to candidates.
Independent recruiters can increase their revenue by developing informal networks of other independent recruiters interested in splitting fees. Another option is for a recruiter or recruiting firm to consider joining a formal split fee placement network.
All of a recruiter’s business doesn’t have to result from split fee placements. Decide on a target percent of your revenue and create actions steps to meet your target.
3. No Guarantee
Yes, I said no guarantee! In 2011, one of NPA’s new members explained how she has not had a guarantee for more than 10 years. Instead, she charges a fee of 30% of the candidate’s annual salary which is paid in three equal payments on the date of hire, 30 days after hire, and 60 days after hire. In addition, she offers the client a discount off the 30% fee if the client pays sooner than agreed; 25% if the fee is paid within 10 days and 27% if paid within 30 days.
The reasoning behind not giving a guarantee is that the independent recruiter supplying the candidate to the client has no control over what happens after the candidate is hired. The client must accept responsibility if the candidate does not work out. Other professionals – accountants, attorneys, etc. – do not return fees. Why should you? This is a paradigm shift worth implementing in 2012.
Do you have any other suggestions as to how independent recruiters may increase recruiter revenue in 2012?