Fees

Hi:
Just wondering what everyone's experience with fees have been. With the economy in the tank....are managers pushing back at fees. In my old MRI days I got 30 percent some jobs. Today I am expecting to be in the 20 percent range, possibly even going down to 15 percent..
Would you agree with these percentages for a small, start up? Suggestions?
Thanks!!

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Permalink Reply by Jim Durbin on August 12, 2008 at 5:31pm

Anything under 20% and it's time to find a new career. 25% if you're a niche is the lowest.

A simple time spent/fee earned calculation makes that apparent.

Less than 20% means you can only make money with high volume/low quality.

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Permalink Reply by bob on August 12, 2008 at 6:42pm

I agree...just wondering where to price myself as an independent recruiter just starting out again....building a business from scratch....
20-25 percent..

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Permalink Reply by Jerry Albright on August 13, 2008 at 10:46am

Hi Bob. Good question.

I have found a very good rule of thumb over the years. The lower the fee is the less the client values what you do. The less they value what you do the less they cooperate with you. The less cooperation you have the less likely it is you will see any fee at all. The less they value your service the more they try to make sure they DON'T have to pay you anything at all. So in all reality - the lower fees are easier to find but harder to actually make happen.....which seems odd..........so if someone wants to shoot me for that statement feel free!

Now this might not be the case in all situations. Like I've got a few clients who will not pay more than 20%. I'll agree to that as a "goal" with the first fee (always - no exceptions) at 25%. Most agree.

I will no longer accept an assignment at 20% to start and will never EVER work a position at under that.

I would recommed not allowing your self talk to be "I'm just starting out" rather - "I am going to provide an excellent service!" and then do just that!

Good luck!

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Permalink Reply by pam claughton on August 13, 2008 at 11:18am

I agree with the others. I wouldn't position yourself with new clients as an 'independent recruiter' or 'virtual recruiter'. Just talk about your company. Perception is everything, and results matter most.

Good luck!

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Permalink Reply by Marissa Smallwood on August 13, 2008 at 12:55pm

I will respond to the one area where the others didnt mentino as far as where the economy is an and effects. I 100% agree to not work for less then 20% and I agree the companies will not value you if you place price war and keep getting lower.

However I have seen some Big firms playing the price wars lately - 18 and 15%. What is up with that. Just curious everyone;s thoughts

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Permalink Reply by Laura Reiley on August 13, 2008 at 2:24pm

Hi Bob.. I have to agree with everything Jerry said. We are a retained search firm and ask for 30%. We explain what a kind of service our client can expect to get. We specialize in providing individualized, professional, results driven assistance. I like to think we make difficult placements in a very timely manner. It seems to me every time we have ever changed our policy to get an account by excepting less money, it has proven to be exactly what Jerry described , we get less cooperation, they don't value the service provided, and collection of the final payment is difficult.