4 Different Types of Recruitment Models

07 Sep 2020

Starting Your Own Business

Once you’ve made the decision to start your own recruitment agency, you may be beginning to search for clients.

Understanding the different recruitment models that employers use can be useful, particularly if you’re starting an agency with no recruitment experience.

There are a number of different ways to work with clients, however here we’ve looked at the four most common models:

Contingency Search

Most recruiters and hiring managers tend to work within this model, particularly for positions where there are likely to be a good number of candidates to select from. An agency searches for the right candidate, alongside other agencies, and only collects a fee if they’re successful in filling the position.

It’s low risk for the hiring manager and allows them to get inputs from multiple recruitment professionals. As an agency it can be frustrating, as it means investing time with the chance of no reward.

Retained Search

For executive roles, hiring managers will often employ the services of a recruitment agency on a retained basis. This means that generally 50% of the fee is paid upfront for the recruiter to source a shortlist of the right professionals within the market.

It might mean headhunting and engaging key individuals from rival organisations, so it is serious time investment, however it does mean you get the chance to build a relationship with the client for the long term.

Recruitment Process Outsourcing (RPO)

Recruitment Process Outsourcing is becoming increasingly popular as businesses look for ways to improve their in-house processes. This model is where the company outsources the whole recruitment process.

It can speed up the time to hire, while relieving pressure on the in-house HR team. As a recruiter it means not just focussing on the role, but on the overall talent needs of the business.

Exclusive Recruitment

Exclusive recruitment means you’ve made an agreement with the client that only you can hire for the role. Normally this is given for a set period of time, on the agreement that if the position isn’t filled it can be opened up to other recruiters. Depending on the conditions of the contract, you could be charged a penalty if you don’t find the right person.

As you don’t have to compete, generally the commission you charge is up to you, however some recruiters will offer special rates for the chance to recruit for the position on an exclusive basis.

If you’re new to recruitment and starting your own agency, then take a look at the range of services New Millennia offer to start-up businesses, and get in touch if you have any questions.

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