Recruiting on Sale?

It’s hard to escape the news out there these days.  The stock market keeps plummeting; politicians are piling on and the dollar isn’t going half as far as it did three years ago.  Recruiters are subject to the market just as much as bankers, traders and real estate professionals? Why? Because as time goes on companies are less and less likely to hire. When they do hire, they’re less and less likely to pay a Recruiter to do the hiring for them.

At times like these Recruiters begin to run into some recurring problems.  Clients slow down the candidates search so much you might think you’re in a time warp.  Candidates become less likely to make a move and companies start asking for steeply reduced fees.  Essentially clients and companies think that Recruiters must be desperate, so they’re start pushing for steep fee reductions and extra effort.  What’s a Recruiter to do ? Can you put recruiting on sale?

• Educate: I recently sat down with a new prospective client.  The conversation went very well and we set and ready to do business.  However, that’s when the client sprung their fee structure on me.  12% for a full-time hire.  Yes, you read that right; 12%.  I could have done the easy thing; hemmed and hawed about the fee and walked out of the client saying we would try to find someone…then just never respond to them again.  Quick, easy…and unprofessional.  Instead I told the truth and rather bluntly.  Yes, I could consider doing a search at such a reduced rate, but each day when I and my team went over our open job orders, the 12% fee would be at the bottom of the list…if it made the list at all. Explaining to the client that Agency Recruiters are essentially coin operated seemed to make an impact.  Turns out he’d been searching for these resources for 5 months and hadn’t really received the volume he’d expected.  When clients begin pushing for fee structures that essentially make them bad business, you can’t just make a false promise and walk away. No, you have to strive to retain the business and help clients understand what exactly they’re paying for in the first place.
• Don’t be Desperate: In tough markets clients have a tendency to think that all Recruiters must be suffering and starving for business.  A lot of them might be, but don’t get yourself lumped into that pile…even if you are desperate! When you seem like you need the business you’ll never become a trusted partner. No, instead you’ll just be another vendor trying to make a buck.  When you’re talking to new clients (or even old ones) you need to keep up the presentation of a successful professional.  You need to be the guy or gal who knows what they’re talking about because you’re the best that’s out there.  The best Recruiters might see a reduction in work when the market hits bottom but they will still have business.  So whether or not you’re the guy who’s rolling in business or the one who’s seriously contemplating a change of career, keep up appearances.  You need to keep a positive, calm and successful appearance at all times.
• Be Prepared to Walk:  Part of not being desperate for business is retaining your ability to walk away.  Sometimes the hardest thing for any professional is to walk away from a client; but when things have gone done the wrong road, you need to move on.  Earlier in my career I had a great client press my rates down too far.  You know what happened? I lost the business anyway. I couldn’t find them the level of candidates they needed when the ROI was so low.  What I learned from that is that you need to be up front with the client and be prepared to walk away…and it’s a lesson I’ve kept with me ever since.  Now when a great client wants to lower my fees I tend to be immovable.  I explain the process, educate them on our wonderful coin operated nature and explain that my group is extremely good at what we do and we simply can’t afford to expend the time and effort we usually do for such a significantly lowered fee.  Most of the time it works, but sometimes I have to tell the client that unfortunately I won’t promise them service that I know we won’t give.  We part, mostly amicably….until the client comes back because they haven’t gotten the service they needed at the price they wanted.

As a Recruiter you need to ensure that you’re seen as an expert and a professional at all times, but at no time more than now. When the market is suffering the most effective thing you can do to maintain your margin and retain business is keep your standards high, but offer a little more of yourself on the consultative piece. Making an extra effort to partner and consult with your clients will go a long way, but lowering your fee structure will take you nowhere fast.  Good luck!