Choosing a recruitment agency
For many employers a recruitment agency is the first thought when a vacancy proves hard to fill. Sometimes rightly so. Here you will read how the business model works, what to look for when choosing, what it costs and when another model is the smarter choice.
What is a recruitment agency and how does it make its money?
A recruitment agency searches for, approaches and selects candidates for a vacancy and presents them to you. You only pay on placement: a fee that is commonly calculated as a percentage of the gross annual salary of the candidate you hire. The scarcer the profile, the higher that percentage usually is. SocialFind works differently: structurally, without placement fees.
Read moreRecruitment agency, RPO, interim recruiter or recruitment marketing?
The alternativesFour routes to the same hire, compared on the points that determine what you ultimately pay and keep.
| Recruitment agency | RPO | Interim recruiter | Recruitment marketing | |
|---|---|---|---|---|
| Payment model | Fee per placement, percentage of annual salary | Fixed monthly fee, no placement fees | Hourly or daily rate | Monthly budget plus media budget |
| Suits | A single specialist vacancy without a structural need | Structural or varied staffing needs | Temporary peak on an otherwise well-running process | Enough internal process, too little visibility |
| Lead time | Depends on the network; fast with a warm pool | First campaigns within weeks, then ongoing | Available immediately, for the duration of the assignment | First applicants as soon as the campaign goes live |
| Owner of the process | The agency; you get the hire | You; the partner executes under your name | You, with temporary extra hands | You; the agency delivers applicants |
| Employer brand | Not part of it; candidates get to know the agency | Core part, grows stronger with every campaign | Not part of it | Part of it, as long as the campaign runs |
| Cost with multiple vacancies | Every placement a new fee | One partnership; cost per hire falls with volume | Limited by the capacity of one person | More vacancies means more media budget |
When is a recruitment agency the best choice?
Honest answer: more often than you would expect us to say. A recruitment agency is the logical choice if:
- You have a single, specialist vacancy and do not expect a structural hiring need in the coming period. Think of a finance director or a specialist in healthcare or IT for whom a niche agency has a proven network.
- You have no in-house recruitment capacity and do not want to build it. Someone has to call, screen and follow up; an agency takes that off your hands for that one vacancy.
- Speed matters more than cost. A specialised agency with a warm candidate pool can sometimes present candidates within weeks where a campaign has to start from zero.
If you recognise yourself in this, you do not need to look any further for alternatives. Just make sure you pick a good agency. If you have several vacancies a year or recurring intake, also read RPO versus recruitment agencies.
What should you look for when choosing a recruitment agency?
On paper, agencies look very much alike. The differences are in the terms and in who actually does the work. Go through these points before you sign:
- Specialisation. An agency that knows your field or sector (healthcare, IT, engineering, sales) has a relevant network and understands what moves candidates. A generalist agency often starts from zero for your vacancy.
- Guarantee. What happens if the candidate leaves during the probation period? Ask about the guarantee period and whether you get money back or a new search without an extra fee.
- Exclusivity. Some agencies ask for exclusivity for a set period. That gives them certainty but ties you down. Agree on what happens if you find a candidate yourself.
- No cure no pay or retained. With no cure no pay you only pay on placement; with retained you pay part upfront and your vacancy is guaranteed attention. Both have their logic; read what no cure no pay really means.
- Reporting. Do you get insight into how many candidates were approached, why they dropped out and what the market says about your terms of employment? Or do you only hear something once a CV lands?
- Who does the search. The account manager you speak to is rarely the one making the calls. Ask who is actually working on your vacancy and how many other assignments that person is running at the same time.
What does a recruitment agency cost?
The common model is a fee per placement, calculated as a percentage of the gross annual salary of the candidate you hire. The logic behind it: the scarcer and more senior the profile, the higher the percentage, because the search takes more time and network. The fee for an operational role is therefore lower than for a board-level role, even though the agency does comparable work.
That fee usually covers searching, approaching, pre-selecting and presenting candidates, plus guidance up to and including the hire. What is usually not included: employer branding, a talent pool built around your employer brand, data about your target group and the candidates who were not quite hired. Those stay with the agency.
When looking at the total cost of a recruitment agency, also pay attention to what is less visible:
- Exclusivity can mean you are not allowed to use any other route during the term, even if it is faster.
- The guarantee period determines your risk: a short period shifts the risk of a wrong match to you.
- Multiple vacancies mean multiple fees. The agency starts over every time and nothing accumulates around your employer brand.
Want to do the full calculation, including the cost of a vacancy that stays open for months? You will find it on the business case page.
When you are better off not using an agency
Not every open vacancy calls for an agency. Sometimes the problem is not finding people, but the way your vacancy is positioned in the market. A vague job title, a text full of requirements and not a word about what you offer: no agency can help with that, and you still pay a fee for it.
If you recognise this, try this first:
- A good job ad that tells what someone will do, with whom and why it is worth it. Not a list of requirements.
- A targeted campaign on the channels where your target group really is, with an application funnel that can be completed on a phone in a minute.
- Fast follow-up. Many candidates drop out because they hear nothing for a week. You solve that internally, not with an agency.
And if your terms of employment are clearly below market, an agency will not solve that either. Not sure where things get stuck for you? The recruitment diagnosis answers that in a single session.
What SocialFind does when you structurally need people
SocialFind is not a recruitment agency. We work as an RPO partner: one team that runs your complete recruitment, from labour market analysis and campaigns to screening and follow-up, under your name. Candidates get to know your organisation, not an agency, and everything we build is built around your employer brand, and the data stay available to your organisation.
We do that for a fixed fee. The partnership starts at EUR 6,500 per month, all-inclusive within the agreed scope and with no placement fees. So you pay for the agreed recruitment capacity and scope, not per hire. The full pricing logic is on our pricing page, how the partnership works on what is SocialFind RPO and all forms of outsourcing side by side on outsourcing recruitment.
Do you have one difficult vacancy and nothing else? Then we say so honestly, and refer you to a good agency.
Ask every agency how the candidates on your shortlist were selected, and whether software that filters or scores CVs played a part. Why that matters is explained in Which EU rules apply to AI in hiring right now?
What does a recruitment agency actually do?
A recruitment agency finds and approaches candidates on behalf of employers and is paid by the employer, not by the candidate. That is the whole category. Within it sit models that have little to do with one another, and the difference always comes down to two things: who does the work and what you are paying for.
- Contingency recruitment. The agency searches, screens and presents candidates; you run the interviews and hire. You pay a fee on placement, usually a percentage of the gross annual salary.
- Executive search. The same principle for board and management roles, but with market mapping and discreet personal outreach. Part of the fee is often paid upfront, because the search runs for months.
- Temp agency work. The worker is on the agency payroll and works at your site. You pay an hourly rate covering wages, employer costs and margin, for as long as they are there.
- Secondment. Similar, but the employee is on a permanent contract with the agency and is placed with clients for longer periods. Common for engineering and office roles.
- RPO, recruitment process outsourcing. The agency runs your recruitment under your own name for a fixed fee, instead of charging per placement. Read what RPO is.
The practical difference: with contingency recruitment and executive search you buy an outcome, one candidate, and you pay again every time. With temp work and secondment you buy an employee through a different contract, and the bill keeps running for as long as that person works there. With RPO you buy capacity and a way of working; the agency operates under your name and everything that gets built, from talent pool to data about your audience, is built around your employer brand and stays available to your organisation. All the models side by side are on the comparison page.
To be clear: SocialFind is not a recruitment agency in the classic sense. We work as an RPO partner, for a fixed fee starting at 6,500 euros per month, all-inclusive within the agreed scope and without placement fees. The full pricing logic is on the pricing page. If you have one single vacancy and no structural hiring need beyond it, a specialised agency is often simply the better choice, and we will say so.
One vacancy or a structural need?
Not sure whether an agency, recruiting yourself or an RPO partner fits your situation? We take an honest look and will tell you if a recruitment agency is simply the best choice in your case.
Frequently asked questions about recruitment agencies
Choose based on specialisation, terms and who does the work. An agency that knows your field has a relevant network and speaks the language of your candidates. Then ask about the guarantee, exclusivity and the choice between no cure no pay and retained. Finally, ask who actually makes the calls for your vacancy and how many assignments that person runs at the same time. A good agency answers those questions without hesitation.
A recruitment agency commonly charges a fee per placement, calculated as a percentage of the gross annual salary of the candidate you hire. The scarcer and more senior the profile, the higher the percentage. You usually pay only on a successful placement, with retained search partly upfront. Also count on indirect costs: exclusivity, a short guarantee period and the fact that every next vacancy is a new fee.
A recruitment agency is a transaction per vacancy: the agency presents candidates and you pay a fee on placement. RPO (Recruitment Process Outsourcing) is a structural partnership in which one partner runs your complete recruitment process under your name, for a fixed fee without placement fees. An agency suits a single vacancy, RPO suits recurring or multiple vacancies, because employer brand, talent pool and data are then in your name.
No cure no pay means you only pay the agency if someone is actually hired through them. No placement, no fee. That sounds risk-free, but watch the incentive: the agency earns from placing quickly and prefers to spend its time on vacancies that are easy to fill. A difficult vacancy therefore sometimes gets less attention than with a retained assignment, where you pay part upfront.
That mainly depends on the scarcity of the profile and the network of the agency. For a role where the agency already has a warm candidate pool, the first candidates can be presented within a few weeks. For scarce specialists and board-level roles a search often takes several months, including interviews and notice periods. Ask the agency upfront about the realistic lead time for comparable vacancies and how they keep you informed along the way.