Are you spending too much on your hiring process? Are you unhappy with the quality of candidates you’re receiving for the money you’re paying? This is a very common problem - in fact many businesses solely rely on recruitment agencies for their entire hiring process, spending much more than necessary in the process.
What is Traditional Recruitment?
Traditional recruitment refers to the use of success-only (also known as contingency) recruitment agencies.
They typically work by advertising your role on job boards and gathering ad response for you, presenting you with a selection of candidates who responded to your advertisement. They may also search through their pre-existing database of candidates, presenting you with a selection of candidates that match your keywords.
This is a largely passive method of recruitment, as most recruiters do very little active talent searching beyond LinkedIn research.
Contingency recruitment agencies typically work on a basis whereby you only pay upon successful hire. Typically the amount paid is based on a percentage of the final salary that the hired candidate receives. This is usually around 15-20%, though the amount paid can be higher, especially if the role is particularly niche or hard to place.
The main benefit of this is the ‘safety net’ it provides, meaning you don’t have to pay if you don’t make a hire. However, the rate that is charged essentially means that you could end up paying quite a large amount for just one hire. This can rack up quite a cost when hiring for multiple roles.
Why Should You Move Away from Traditional Recruitment?
There are two key reasons why many companies would benefit from changing the way they recruit.
1. The Cost
Ultimately, the main reason more and more businesses are moving away from working exclusively with recruitment agencies is the cost.
Relying on recruitment agencies alone to take care of your hiring process can be costly. In fact, it costs many businesses tens of thousands every year. This is especially true for businesses with high turnover rates, or businesses that often make larger groups of hires at a time, for example, the retail and logistic sectors. The more people you hire through recruitment agencies, the more the cost rises.
2. They’re Behind Current Trends
Put simply, many traditional recruitment agencies are largely outdated in comparison to modern recruitment alternatives.
The process used by many recruitment agencies simply just isn’t targeted enough. To find the right candidates for your business, you need a recruitment process that’s targeted to the type of employee you want. Recruitment agencies largely offer a catch-all approach focused on submitting a lot of candidates to you quickly rather than specifically supplying the right candidates.
With some recruiters, this can even mean giving an inaccurate impression of the role at hand in order to garner more candidate interest. This of course results in you receiving a higher number of candidates who just aren’t the right fit for the role or your business.
Alternative Recruitment Methods
So what alternative recruitment methods are available? Depending on the role you’re looking to fill, you have a choice. The three most common non-traditional recruitment methods are fixed-fee recruitment, headhunting, and internal recruitment.
1. Fixed-Fee Recruitment
As the name suggests, fixed-fee recruitment provides an alternative to traditional recruitment, providing businesses with a similar service but at a much lower, fixed cost. Through fixed fee methods, (such as Hiring Wizard’s advertising service), you only pay one fixed fee regardless of how many hires you make for a role.
This provides a number of advantages over traditional recruitment, most notably a considerable cost saving. At a standard fee of 15-20% of the hire’s salary, you could be paying £6,000 hiring one person for a £30,000 role. For comparison, through Hiring Wizard’s Managed Campaign service, you can hire multiple candidates for the same role for just £1,495.
With clear costs and quick results, fixed-fee recruitment is a reliable, cost-effective hiring solution for any business.
Headhunting agencies are a high-level recruitment alternative aimed at proactively finding top talent for senior roles, usually at Director and C-Suite level. These agencies are an ideal recruitment option for hard to fill senior roles that require a more detailed search than a typical recruitment agency provides.
Headhunters are more costly than a typical recruitment agency due to the much higher level of service provided.
Headhunters are focused on proactively finding the very best possible hire for your business-critical role including targeting those prospective candidates who are not proactively looking. This can save you a significant amount in rehiring costs.
The cost of rehiring can be substantial, especially for high-paying roles, and headhunting ensures you get the right hire, first time.
3. In-House Recruitment
Some businesses choose to directly employ their own recruitment team with the aim of saving money. This enables them to recruit for positions by upskilling people within their own business, or conduct their own external hiring process.
But is this method really easier and more cost effective than using an external recruitment method?
The short answer is no. Whilst it may seem that companies will save money by doing it themselves, the reality is that this method often produces lower quality results. The vast majority of businesses simply do not have the capacity or resources to find the best possible hires, whilst recruitment agencies do. This often results in a long recruitment process, a lot of low-quality candidates, and ultimately, a large chance of rehiring which costs a significant amount of money. Many businesses that attempt to find the best candidates internally end up turning to recruiters eventually due to a lack of success, wasting a lot of valuable time in the process.
In-house recruitment can sometimes be beneficial, but this is usually only when a business has planned to fill a vacancy for a long time. If a potential candidate within the business has been thoroughly trained and upskilled, it’s possible to conduct successful recruitment internally, but more often than not, internal recruitment simply doesn’t produce the right results.
Reduce your Costs Without Reducing the Quality
In summary, by reviewing the alternative ways of recruiting, you could drastically reduce your recruitment spend without sacrificing on quality. For the less senior, more volume roles, a fixed fee recruitment method is likely to deliver significant benefits, whilst the headhunting route is more likely to be cost effective for your more senior level roles.If you have any questions regarding our services at Hiring Wizard or fixed-fee recruitment in general, please don’t hesitate to contact us at Hiring Wizard on 0161 696 8899 or email email@example.com. Our dedicated team will be happy to talk you through any questions you may have.