Should I Use Retained Search or Contingency Recruitment?

​A Guide to Retained Search and Contingency Recruitment?

If you're recruiting a senior, specialist or business-critical role, you may be wondering whether to use retained search or contingency recruitment.

The short answer is:

Contingency recruitment can work extremely well when there is a healthy candidate market and you want to pay only when somebody is successfully hired. Retained search is usually better suited to senior, specialist, confidential or difficult-to-fill appointments where you want a recruitment partner to commit to searching the market thoroughly on your behalf.

Neither model is automatically better.

The right choice depends on the role you're recruiting, the availability of suitable candidates, how important the appointment is to your business and how thoroughly you need the market to be searched.

What is contingency recruitment?

Contingency recruitment is the traditional "no placement, no fee" recruitment model.

The recruitment agency is normally paid only when a candidate they have introduced is successfully hired.

Depending on the agreement, a business may work exclusively with one recruitment agency or engage several agencies on the same vacancy.

The attraction is obvious: there is usually no upfront recruitment fee and the financial risk to the employer is relatively low.

Contingency recruitment can work particularly well when:

• The role has a reasonably large candidate pool

• Suitable candidates are actively looking for work

• Speed is important

• The position isn't highly confidential

• The role doesn't require extensive market mapping or headhunting

• You want a success-based recruitment fee

For many permanent vacancies, it can be a perfectly effective recruitment model.

What is retained search?

Retained search is a more committed partnership between the employer and recruitment consultancy.

Rather than simply paying a fee if a candidate is successfully placed, the client engages a recruitment partner to conduct a defined search on their behalf.

The assignment is normally exclusive and the recruitment fee is usually paid in agreed stages.

That allows the recruitment partner to dedicate significantly more time and resource to understanding the business, mapping the market, identifying potential candidates and proactively approaching people who may not be actively looking for another job.

A retained search may include:

• Detailed briefing and role analysis

• Salary and market benchmarking

• Competitor and market mapping

• Identifying target companies

• Researching potential candidates

• Direct approaches and headhunting

• Approaching passive candidates

• Candidate screening and assessment

• Shortlist management

• Interview coordination

• Candidate feedback

• Offer management

• Ongoing market intelligence and advice

The recruiter isn't simply trying to find someone who can do the job.

The objective is to properly search the relevant market and identify the strongest people for the appointment.

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Retained Search vs Contingency Recruitment

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What is the main difference between retained and contingency recruitment?

The biggest difference isn't simply when the recruitment agency gets paid.

It's the level of commitment and the type of search being undertaken.

With contingency recruitment, the agency carries much of the commercial risk because it may do considerable work and receive no fee if another route fills the vacancy.

With retained recruitment, both parties make a commitment to the search.

The employer commits to the recruitment partner.

The recruitment partner commits its time, research and resources to delivering the assignment.

That can completely change the way a difficult or senior recruitment project is approached.

Does retained search find candidates who aren't actively looking?

Yes. This is one of the main reasons businesses use retained search.

Some of the strongest candidates in a market aren't necessarily searching job boards or applying for vacancies.

They may already be performing well in another organisation and have no immediate reason to move.

These are often referred to as passive candidates.

A proper search therefore involves identifying those individuals and approaching them directly to understand whether the opportunity could be relevant.

This becomes particularly important for senior and executive recruitment.

If you're looking for a Managing Director, Retail Director, Operations Director, Commercial Director or another senior leader, limiting your search to people actively applying for jobs could mean overlooking a significant proportion of the potential candidate market.

When should I use retained search?

Retained search is particularly worth considering when the appointment is:

Senior

For Director, Managing Director, CEO or other leadership appointments, you may want a much broader view of the available market rather than simply reviewing people currently looking for work.

Specialist

If only a relatively small number of people have the experience you require, a proactive search may be necessary.

Business-critical

If getting the appointment wrong could have a significant commercial impact, investing more time in the search can make sense.

Confidential

Sometimes an organisation doesn't want a vacancy advertised publicly. A retained search allows potential candidates to be approached discreetly.

Difficult to fill

If advertising and traditional recruitment methods haven't worked, repeating exactly the same process is unlikely to suddenly produce a different candidate market.

Highly competitive

If the people you want are already being approached by competitors, a more proactive search may be required.

When is contingency recruitment the better option?

Retained search isn't necessary for every vacancy.

And we'd be wary of any recruitment company suggesting that it is.

Contingency recruitment can make considerably more sense when there is a good supply of suitable candidates and the role doesn't justify a full market search.

If we already know several excellent candidates for a vacancy, there may be little benefit in asking a client to fund an extensive retained search.

Likewise, if you're recruiting several relatively common positions, a traditional permanent recruitment model may be quicker and more commercially appropriate.

Good recruitment advice isn't about selling the most expensive service.

It's about choosing the right recruitment approach for the vacancy.

Is retained recruitment more expensive than contingency recruitment?

Not necessarily.

Retained executive search is often associated with higher fees because of the depth of research and resource involved, but the headline percentage doesn't tell the whole story.

Recruitment fees vary considerably according to the role, salary, complexity of the search and recruitment company being used.

The more useful question is:

What am I getting for the recruitment fee?

A retained search may involve considerably more research, market mapping, headhunting and candidate assessment than a traditional recruitment assignment.

It should therefore be judged on the service and outcome rather than simply comparing two percentages.

Why does exclusivity matter in recruitment?

Exclusivity allows one recruitment partner to take proper ownership of the assignment.

Instead of several agencies potentially contacting the same candidates with different messages, one recruitment partner represents the vacancy and the employer in the market.

That can create a much cleaner candidate experience.

It also gives the recruitment partner confidence to invest more time in researching the market because they know they aren't simply racing several other agencies to submit the first available CV.

At C2 Recruitment, we strongly believe that quality recruitment works better when there is genuine commitment on both sides.

Is using several recruitment agencies better than using one?

It can feel logical.

If one recruitment agency can find candidates, surely five agencies will find five times as many?

In reality, it doesn't necessarily work like that.

Several agencies may have access to many of the same job boards, databases and candidates.

That can result in duplicate approaches, duplicated CVs and candidates receiving multiple messages about the same vacancy.

For certain high-volume or urgent recruitment projects, multiple suppliers may have a role.

But for specialist and senior recruitment, we'd usually favour a closer partnership with a recruitment consultancy that properly understands the brief and takes ownership of the search.

What is executive search?

Executive search is a specialist form of recruitment used primarily for senior leadership and business-critical appointments.

Rather than relying on advertising or existing applicants, an executive search consultancy proactively identifies and approaches individuals who fit the brief.

This may involve researching competitors and adjacent sectors, mapping senior leadership teams, identifying potential candidates and confidentially approaching people who aren't actively looking for another position.

Executive search is therefore commonly delivered on a retained basis.

Should I use retained search for a £100,000+ appointment?

Salary alone shouldn't determine the recruitment model.

However, once you're recruiting at £100,000+ level, the potential impact of the appointment normally becomes considerably greater.

At that level, we'd ask:

• How important is this person to the future of the business?

• How many genuinely suitable people exist?

• Are the strongest candidates actively looking for work?

• Do we need to search competitors?

• Does the appointment need to remain confidential?

• What happens commercially if we make the wrong hire?

• What happens if the position remains vacant for six months?

If the answers point towards a business-critical appointment and a limited candidate market, retained or executive search is likely to deserve serious consideration.

Which recruitment model should I use?

A simple way to think about it is:

Is there a healthy supply of suitable candidates already available?

Yes
↓
A good contingency recruitment approach may be enough.

No
↓
Is the role senior, specialist, confidential, difficult to fill or commercially important?

Yes
↓
You may need a more proactive search of the market.

Need market mapping, headhunting and passive candidate approaches?
↓
Retained Search or Executive Search

The important point is that salary alone shouldn't determine the model.

Candidate availability, confidentiality, seniority, business impact and the difficulty of the search should all be considered.

Can a recruitment agency offer both retained and contingency recruitment?

Absolutely.

In fact, we believe that's important.

At C2 Recruitment, we don't try to force every vacancy into the same recruitment model.

We offer:

• Traditional permanent recruitment

• Retained search

• Executive search

• Candidate sourcing

• Job advertising

• Bespoke fixed-fee recruitment

• Ongoing recruitment partnerships

The right solution depends entirely on what the client is trying to achieve.

Sometimes contingency recruitment is absolutely the right answer.

Sometimes a fixed-fee solution makes more commercial sense.

And sometimes a business needs us to go out and properly search the market.

How does C2 Recruitment approach retained search?

C2 Recruitment has been recruiting since 2008, specialising in Retail, Hospitality, Head Office and Senior & Executive appointments across the UK and internationally.

Our retained search approach starts with understanding the business – not searching a database.

We want to understand why you're recruiting, what success in the position actually looks like, the type of person who will succeed within your organisation and where those people are likely to be found.

From there, we can build a bespoke search strategy using our industry networks, recruitment technology, databases, research, market mapping and direct candidate approaches.

And because we're specialists, we're not simply searching for keywords.

We're not salespeople who happen to work in recruitment. We're industry specialists who happen to work in recruitment.

That's particularly important when recruiting senior leaders.

The best candidate isn't necessarily the person with the most obvious CV.

Sometimes it's the person who has never even considered applying.

So, should I use retained search or contingency recruitment?

If you have a relatively straightforward vacancy, a good pool of available candidates and want a success-based recruitment model, contingency recruitment may be exactly what you need.

If the appointment is senior, specialist, confidential, difficult to fill or commercially critical, retained search is likely to give you a much more thorough approach to the market.

The key is not starting with the recruitment model.

Start with the problem you're trying to solve.

Then choose the recruitment approach that gives you the best chance of solving it.

Need advice on the right recruitment model?

If you're unsure whether your vacancy needs traditional recruitment, retained search, executive search or a bespoke fixed-fee solution, speak to C2 Recruitment.

We'll happily talk through the vacancy, the candidate market and the different options available.

If we think contingency recruitment is enough, we'll tell you.

If we believe the role needs a proper retained search, we'll explain why.

And if there's a better way of structuring the recruitment project, we'll suggest it.

No one-size-fits-all recruitment model. Just straightforward advice and the right recruitment solution for your business.