Has anybody made the conversion from Contingency to Retained Search?

Although I have been a contingency recruiter for almost 297 years, OK maybe not quite that long, I have of recent been seeing less commitment from hiring managers to contingency recruiters. I have given serious thought moving my agency to retained in it's entirety or at least in part. Has anybody made this transition? If so what caveats, models to follow, tools etc can you advise me to look at and possibly incorporate into this process? I'd appreciate all responses, pros and cons.

George Mancuso, CPC
President Gman Business Resources

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Comment by George Mancuso on April 23, 2008 at 4:17pm: Well I'm certainly in agreeable with that and it's probably going to be our approach. Have you used this method and if so, what kind of down payment did you require (%). Being contingent for so long, our presentation is not geared to that avenue, thus the reason for my "cry for help" from our Retained colleagues.

Comment by Paul DeBettignies on April 23, 2008 at 5:24pm: I have been doing IT contingency for 10 years in Minneapolis.

While still a contingency model this past year I have started requiring a $5K payment. This has cut down the number of total searches done. It has brought on some negotiation on the fee. It has increased the number of placements and increased revenue.

It also has furthered my tag line of wanting to be the first or last call for help. I have long grown tired of being one of many vendors.

Comment by George Mancuso on April 23, 2008 at 5:53pm: Paul; I am curious about a couple of things. You ask for a financial commitment and what has been the typical objections? Do you consider the search to be retained even though you are a contingency recruiter? I know that the retained folks always talk about doing way less searches, claiming higher billing revenues and NOT working for free. I too am tired of waking up one morning only to find my client has "found" his own candidate and mine fall by the wayside.

Comment by George Mancuso on April 24, 2008 at 3:50pm: Appreciate the encouragement Craig. I'm 64 years old and I've been doing this 22 years and the industry has changed so much. The honorable hiring managers have seem to have gone by the way side. If I don't get the commitment I have stopped giving the effort. Working for free sucks!

Comment by Paul DeBettignies on April 24, 2008 at 3:55pm: George, sorry I missed your reply yesterday.

The $5K can be pitched in different ways. It can be made as an engagement fee – in order for me to start the search I require a $5K engagement fee.

To that I usually get one of many replies including, “We don’t do that” or “No one else requires this” to which I respond, “How are your current firms doing for you” and “In order for me to do the best search possible I need to know you too are committed to this relationship”.

If they say other firms are working on it I will ask to be notified when they get to a point where they need my complete focus.

Yes, many folks say no to this and most of the time I walk away from the search.

A reminder, I am only in IT, been doing it for 10+ years, and in one market. So to a large extent I have credibility, reputation and track record. I would think you do too.

My goal in using this formula is to be the first or last call for help.

If the first, there are times, situations, relationships where I will lower the fee percentage. If the last, I do not. The reasoning being this must be something tough if their ads, employees, other search firms have not been successful.

If during my work the position is filled not by me, regardless of how, I will either reimburse the $5K, apply it to a future search with their permission, or switch to another position they need help with. So far about 15% of the time the engagement fee has been reimbursed.

Also, I am a relationship guy and so most of my clients are long term, more than one search, more than one placement. With companies who really want a trusted partner I request the $5K the first time. I can get a feel if this will work for me (and them) or not in terms of successful placements.

Comment by Paul DeBettignies on April 24, 2008 at 3:57pm: Another tactic is to ask for is an "exclusive" for two weeks.

Much if this is about trust and relationships. If you have it or can build it, these become easy details.

Comment by George Mancuso on April 24, 2008 at 4:38pm: Excellent points Paul. Fortunately I do have some very solid relationships and a quality reference list of very satisfied clients. It seems to be most of the "newbies" I've gotten lately and I'm planning to move towards more of a model that you have described. Thanks again for the advice and motivation.

Comment by Mitch Sullivan on March 18, 2014 at 10:24am: Getting clients to pay you upfront to fill jobs is a process. It starts with contingency, is trialled via exclusivity and is embedded with retainers. You sell the journey to the client right from the off.

There are a number of critical differences between those three stages in terms of the level of service you need to offer. That's where most contingency recruiters get it wrong when they do get a retainer - they just replicate the same contingency activity they usually do.

The whole point of taking a retainer is that you commit to definitely filling a job. Too many contingency recruiters have a maybe mindset. They don't know what it's like to HAVE to fill a job.