In this video, we will discuss how you can save on your recruitment cost.
In this video I am going to do two things that are usually not done at the same time. I am going to tell you, as an employer, how you can save on your recruitment cost and in doing that I am also going to tell you how to get better service.
Let me start with an anecdote. I was having lunch a few months ago with a business owner that we had worked with for about 6 years. When we first started working with him, he had a 400 person company. He had sold the company about 6 months ago and at that time we had helped him grow to about 1200 people nationally. In doing so we filled about 25 jobs- VP HR, VP marketing, VP Ops, multiple accounting jobs and multiple operations jobs. We had a very good relationship but we really didn’t talk much. We generally worked through his executives.
After he sold the company, like all business owners do, he went golfing. He came back in the area and suggested we get together. We talked about the work we had done and he tanked us and all the normal stuff. But he said something that really struck a chord with me.
He said that when he first started to interview vendors, he was very suspicious about working with us. He said it was because we were by far the cheapest. Everyone else was talking to him about high percentage rates. He kept expecting us to fail because we were the cheapest provider and he kept waiting for a mistake. And he never got one in 6 years.
He flat out asked me “Why do you charge so little?” and I had to think about the answer. The answer was that we are priced for a relationship. We are not priced for a transaction. We worked with him for 6 years. We take a lot of pride in that. We build organizations.
Let me distill this into a description of what we look for versus what other recruiting companies look for. Most recruiting companies that will approach you are usually contingency firms. Contingency firms are brokers. They collect people and they collect projects. They shake them all up. The convenient matches fall through the sieve and those are the ones they charge their 20, 25 or 30% fees for. Those are high fees.
The secret to that is they only fill about 20% of the jobs that they get which means 4 of the 5 that they get, they don’t fill. They do some work on them but they don’t fill them. What does that mean to you as an employer? If you’re the one that they fill, your fee has got to be high because that’s how they subsidize the ones that they don’t fill. How does that work out for you?
What we look for are companies and situations where we KNOW we can fill the job. Our completion rate is about 90%. That means we don’t have any losers that we need to subsidize. How do we know whether we can fill the job? Because we look for companies that will talk to us. That will help us understand them. That will provide us the background data. That will give us the narrative so that we understand how to work with them, what they will expect from candidates, and how to present them to candidates. When we find employers like that and employers who can give us multiple assignments over time, we develop relationships. We reward companies that give us relationships. We’ve had clients that we’ve been with for years and candidly, one or two of them decades and we’ve been able to drive their price of recruitment down to 15% and in certain situations as low as 10%.
These are companies that have saved hundreds of thousands of dollars in recruiting and, because they’ve developed a relationship with us, they’ve gotten better service than they would from the higher priced contingency firms that are exclusively transaction oriented.
This is a fact. We can document it. We can refer you to these companies if you are interested in exploring more. Don’t be pigeonholed into how you think a recruiting firm should charge you. There are multiple ways to skin a cat and we think we’ve found one that is good for companies that truly want a partner and want a vendor that they can count on. If you are interested in learning more, you know where to go- Right Recruiting, Blue Bell, PA. Thank you.
Music by Ema Grace | “Check Them In” http://freemusicarchive.org/music/Ema_Grace/~/Check_Them_In
Creative Commons Attribution License — Changed only to shorten for need.