Fee Negotiations

The Importance of References
July 22, 2013
The headhunting arm of your business – selecting a recruitment partner
September 19, 2013

Fee Negotiations

It has always been with huge frustration that I listen to companies say that they cannot use a headhunter because of the cost involved. I think quite clearly there are headhunting companies that are responsible for this misconception but this is not the case at Eagle Headhunters.

In most UK headhunting/executive search companies the fees are circa 30% of the annual total renumeration of a candidate and this fee is payable in 3 stages – the retainer (paid in advance), the shortlist fee (payable on client satisfaction of shortlist) and the final fee on appointment of a candidate. At Eagle Headhunters we also charge 30% but only have two stages – the retainer fee and the final fee. We believe in a success driven fee system where the client pays the majority of the fee on appointment of a candidate.

However that is the basic structure of our fees but is rarely what we work to. It has clearly been a buyer’s market for the last 7 years and so any client we meet has the luxury of being able to negotiate but it has to be a fair negotiation from both sides. Some clients are adamant that they will not pay a retainer fee – there are ways around this which means that they can still use our services, but there is clearly a lack of trust created right from the outset, which makes it difficult to conduct as committed a search as one would for a client who has paid a retainer fee. We meet with a client first to understand the requirement in full and then we are able to negotiate. If the requirement is something where we have a lot of contacts and think that it will be a fairly straight forward search then we will more than likely be able to drop our fee to circa 20% but if however it is a complex search where we will have to use a lot of resource then we will be less likely to drop below 25%. Again if you are a repeat client where we have built a sustainable relationship then fees can be become very attractive for the client without losing any of the quality of our work.

We see each piece of work and each client as bespoke and as such we see each fee as bespoke and can tailor that fee to suit your needs. However a note to the client and ourselves is that fee negotiation should not be driven by how much money a client can save or how much money we can make. It has to be focused on value and what is deemed to be fair for both parties which in turn will attribute to a successful recruitment campaign.