The Pros and Cons of Using a Contingent or Retained Search Firm

As a hiring manager, you have many options available to you when it comes time to fill an open position. You can post the job on your company website or on job boards, you can rely on your network of contacts, use human resources, or you can bring in a search firm. But which type of firm should you use? Here’s an overview of the differences between contingent and retained search firms and the pros and cons of each option.

The Difference Between Contingent and Retained Search Firms
Contingent search firms are paid only if and when they successfully place a candidate in the open position. These firms typically take a percentage of the candidate’s first-year salary as their fee. In contrast, retained search firms are paid a fee or fees upfront and receive payments for their services during the search and on completion of the search.

The Pros and Cons of Using a Contingent Search Firm
A Contingent Search Firm is usually used on jobs paying up to 150,000. One advantage of using a contingent search firm is that you only pay if they deliver results. This can be a great option if you’re uncertain about whether or not you want to bring in outside help. However, there are some downsides to using a contingent firm as well. For one thing, these firms typically don’t always have the same kind of resources or access to high-quality candidates as retained firms do. Additionally, because they’re only paid if they make a placement, contingent firms may be less inclined to stick with the search process for the long haul if they encounter any difficult obstacles along the way. They may not spend the time & diligence on the contingent search as they would on a retained search. They are at risk of receiving no fee if the position is not filled or filled through another recruiter.

The Pros and Cons of Using a Retained Search Firm
Retained Search Firms are most often used on jobs paying $150,000 and above. Using a retained search firm offers several advantages over relying on a contingent firm or attempting to fill the position yourself. First of all, because these firms are paid upfront, they have more skin in the game and will be more invested in finding the right candidate for the job. Additionally, retained search firms typically have larger staffs and more resources than contingent firms, which means they can handle more complex searches. Finally, because they’re not reliant on making a placement to get paid, retained search firms can afford to be more selective about the candidates they present to you, saving you valuable time and energy in the hiring process. Of course, there are also some drawbacks to using a retained firm. One is that you’ll need to pay up front part of the fee. And it more complicated, with money already invested, to pivot to another recruiting firm if you don’t enjoy the experience working with the retained search firm or the candidates they produce for you.

There’s no right or wrong answer when it comes to deciding whether to use a contingent or retained search firm; it all depends on your specific needs and preferences as a hiring manager. If you want more control over the search process, then using a contingent firm may be your best option. On the other hand, if having someone who will be fully invested in finding the perfect fit for your open position, then working with are retained firm may be the best choice.

If you are looking for a more long-term, exclusive partnership with a search firm to fill a critical role in your company, an retained executive search may be the better option. However, it is important to keep in mind that no single model can be perfect for every organization. The best way to decide which recruiting model is right for you is to evaluate your unique situation and needs. Have you had success with one of these models in the past? What challenges have you faced when trying to fill roles within your organization?

Want to talk with Joe about the type of search provider that is best for your company call Joseph Michaels International Recruiters at 1-800-786-1099. Or email,

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