Resources for Training, Scripts, and Rebuttals. Everything you need to run your desk at peak performance.
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Every Recruiter needs to start with a solid foundation. When you are new to Recruiting you are a sponge soaking up everything you can get your hands on...and that is what you will find in our brand new and updated READ EDITION.
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One of the hardest things for Recruiters is at the end of a Job Order where they have to negotiate their fee. Most of the time Recruiters make this harder on themselves than they need to by using the wrong language. Let's brush up our negotiation techniques.
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20% to 15%. What's the difference?
It’s a lot easier to discount fees than it is to fight. But keep in mind that on an annual package of R300 000.00, a 20% fee would put R60 000.00 on the board. At 15%, it would be R45 000.00! If you accept a fee of 15%, you are leaving R15 000.00 on the table, for the same amount of work! When you discount your fee from 20% to 15%, you are not just losing 5%. You are cutting your fee by 25%. Somewhere along the way, our industry has become locked into 2.5% increments, when in many cases, all the client wants is SOME reduction. Instead of going from 20 to 17.5%, why not try 19.9%, or 19.5%? You’ll be amazed how receptive clients are to this technique!
Your tone and language
Don’t rush. This is the most important discussion you will have with a client. Don’t appear tentative or nervous. Don’t use phrases like “our normal fee is”, or “I’ll speak to my manager”, or “typically we charge”. Your message should be “I have a solution”. Drop names and use other clients as references: “We work with clients like [ABC] and [DEF]. You should ask THEM why they pay us our fee!”
When do you talk about your fee?
Qualify the fee at the END of the Job Order, not at the beginning. If they share with you that the position has been open for over a month and they still haven't found anyone, remind them! However, sometimes it's not possible to wait until the end of the Job Order to talk about the fee, because the client might ask you at the beginning of the conversation what you charge. In that instance, follow the logic below: Objection: Let's not waste each others time. We only pay 10%. If you can't do it at 10%, let's not even talk. Response 1... "I’m happy to talk about my fee, but do you ever talk about your pricing before you understand what it is you’re being asked to do? I’m happy to talk about fees, but let me make sure I can fill the job first and then we can discuss the fee. Doesn’t that make more sense?" Response 2... So let me make sure I understand. If I could make the fee more affordable, then I’d have the opportunity to work on this search for you, is that right?" [Get a 'YES'] "Okay, I can’t get any change in my fee approved without some sense of what I’m getting myself into. Can you tell me a bit about the position?" This frees you up to take the job order because the client assumes you are going to negotiate. You must then make sure you emphasise: The critical nature of the search to the client. The money that is being lost by the client by the position being open. The value of the recruited candidate. Their urgency and the commitment that requires. Once you’ve done that well, you return to the objection. And point out that now that you have this info, you cannot justify a discount. It’s just too hard. By this time you should have established yourself as a professional and created an emotional bond.
Qualifying your fee
3 Qualifying Fundamentals 1. Tell the client what you charge. 2. Tell your client about your guarantee. 3. Get approval from a decision maker. These steps must be done VERBALLY. Do not simply send a fee agreement and hope they got it and understood it. Follow these 3 steps, and you now have a qualified fee! It’s that simple. Step1: Start with a Summary Close "Based on what you’ve shared with me about how critical this position is, I think I can help, and of course, I’d like to earn your business… Step 2: Throw in a Transitional Statement... "Let me tell you what gets this process started..." OR "Let me tell you how we work, because obviously, we don’t do this for free..." OR "If we work together, you are going to pay a premium for my work. The good news is that you don’t pay anything unless you end up hiring my person..." Step 3: Now tell them what you Charge... "We charge the standard industry fee of 20% and we back that up with a 60- day replacement guarantee". Step 4: Close It!... "I'm assuming that if I find you the right candidate, our fee isn't going to be a problem?" But what if they say it IS a problem? The biggest misconception in taking a Job Order is that if you qualify the fee correctly (for example, using any of the scripts provided above) that you won't get any objections. This is hardly ever the case. Sometime they do say 'no problem' and it's nice when that happens, but most of the time they're going to want to negotiate, so it's critical that you're prepared. Remember, Qualifying Fees is what you say when they say "what do you charge?" Negotiating Fees is what you say when they say "you charge too much!"
The 3 most powerful Fee Phrases
The 3 Most Powerful Fee Negotiating Phrases... 1. I'm not asking you to PAY 20%. 2. On a contingency basis, the risk is mine. 3. Let me compete. Hire the best person. Here is what that might sound like... "I’m not asking you to just accept 20%. I’m just saying, when you consider that I’m doing it on a contingency basis and the risk is mine, what have you got to lose? All I’m saying is let me compete. Let me send you my candidates, see theirs as well, and hire the best person. Does that make sense?"
FEE rebuttals
Review all the Fee Rebuttal options below, and make sure you are comfortable with, and understand not only the words, but the intent behind the words. Generic Fee Rebuttals: The following Generic Fee Rebuttals below can be used any time a client says: "Other agencies charge less" "We only pay X" "That’s too high" "We don’t pay that" Response 1... "That’s fine [NAME]. How about if I give you my sliding scale discount plan where you pay a full fee now, to establish our relationship, but earn a continuing discount as we go. I think that’s fair to both of us?" Response 2... "Of course I do reduce fees on occasion for excellent clients. But right now, since we haven’t worked together before, I can’t give you a discount upfront. But the sooner we get busy and work together, the sooner I can justify setting up a client discount program for you". Response 3... "[NAME], I realise it’s not inexpensive, but you don’t just pay me to find the people. Any agency can do that. You pay me to secure the person. You pay me for my research process, target planning, hundreds of phone hours spent qualifying, reference checking and interviewing, salary negotiation, counter offer and ‘fear of change’ training. I’m in their heads until the day they start with you. That’s what you pay me for". Response 4... "[NAME], my fees are based on a reasonable estimate of the total package during the first year, not just on the basic. I charge 25% of that total package, but in the spirit of compromise, to earn your business, I’ll reduce my fee to 20% and base it just on the basic salary. If I succeed we can revisit this. Is that fair?" Response 5... "[NAME], I must tell you, MOST of my clients use other sources, some less expensive and some more, and then hire the best candidate. Our whole multi-billion rand industry is built on that notion, and the only risk until you hire someone is mine". Response 6... "You may be right. There are certainly people that will do it for less. Let me ask you one question though. Don’t you think the relationship between cost and quality applies to search companies as well? Rather than ask why we charge so much, you should ask yourself why the other agencies charge so little". Response 7... "I respect you questioning the fee. Cost SHOULD be a concern. But have you ever considered how much a BAD hire might cost you? Let me send you one candidate to show you what I can do". Response 8... "What are the circumstances under which you WOULD pay a standard fee? I have many clients whose fee policy is lower than my fee, but they will use me when the position is critical and break that policy when they can’t afford to make a bad hire". Response 9... "I know there are other agencies that charge less, but that is because they DO less. In this market, the great candidates are not going to make a move and risk being retrenched. They are not on the Internet or responding to ads. They need to be persuaded, and we have a process to make that happen. That’s why we charge what we do. All I’m asking for is a chance to compete and show you what I can do" Response 10... "[NAME], I can’t change the price because I’m known in the industry by people who pay me my full fee, but I can accomplish the same thing by taking R5 000.00 off the total invoice if it’s paid by start date. Does that sound fair?" Response 11... "You’re right. We ARE higher than most agencies. You could definitely pay less to another agency than you could with us. But we’ve been in business for [X] years, and we have always been higher. The question you have to ask yourself is, if we have always been higher, how have we been this successful and lasted this long Somebody’s paying it, why are they? THAT’S the question you should be asking me" Response 12... "[NAME], I KNOW there are agencies that charge a lot less, but they charge you less because you ask them to. I can assure you though that they charge the companies in your industry with more contemporary fee policies a full fee. The candidates those companies reject, they send to you. I want to be able to send you my best people first. Does that make sense?"
advanced fee fighting rebuttals
DEMsays...Clients have received the message loud and clear that your competitors will discount fees in a misguided attempt to survive (misguided because they cut their fees, their costs rise, and they don’t survive anyway). If you are dealing with bigger companies with HR people with some measure of power, then you’ve got a tough fight on your hands. But if it were easy, everyone would be billing half a million rand a month, not just 1% of us! I continue to advocate strength in fighting fees. But it’s hard when it’s the 25th of the month and you need a placement. The best answer to this problem is to keep calling. But along with that, let me suggest a couple of other things. When your clients interrupt your presentation and say: "Let’s get to the bottom line. I don’t want to waste your time. We can’t pay 20%" Most recruiters say one of two things: 1. What can you pay? / What are you used to paying? 2. But we’re really good because [inserting the relevant company- appropriate propaganda]. Let’s try something different instead: "So let me make sure I understand. If I could make the fee more affordable, then I’d have the opportunity to work on this search for you, is that right?" [Get a ‘YES’] "Okay, I can’t get any change in my fee approved without some sense of what I’m getting myself into". THIS FREES YOU UP TO TAKE THE JOB ORDER BECAUSE THE CLIENT ASSUMES YOU ARE GOING TO NEGOTIATE. YOU MUST THEN MAKE SURE YOU EMPHASISE: The critical nature of the search to the client. The money that is being lost by the client by the position being open. The value of the recruited candidate. Their urgency and the commitment that requires. ONCE YOU’VE DONE THAT WELL, YOU RETURN TO THE OBJECTION. AND POINT OUT THAT NOW THAT YOU HAVE THIS INFO, YOU CANNOT JUSTIFY A DISCOUNT. IT’S JUST TOO HARD. BY THIS TIME YOU SHOULD HAVE ESTABLISHED YOURSELF AS A PROFESSIONAL AND CREATED SOME RAPPORT. Let me close with one of my personal favourite lines that has served me well with the same objection... OBJECTION: "I’ve got agencies doing it for 15%. Take it or leave it". REBUTTAL: "Let me ask you something, and let’s see how fair-minded a person you are. What’s the MOST you EVER paid an agency for a candidate? [2 out of 5 will say 20% or MORE!] Once that’s established, you can go in a couple of directions, depending on your mood... "So what has changed? You cared about getting the best person then, but now you’re over it? You’re not about quality people any more?" OR "So clearly you understand that there is a correlation between cost and quality, or you never would have paid it. I’m not asking you for the money up front. I’m saying, let me compete, take the risk myself and know going in that I have to find a candidate worthy of my fee. Let’s operate under that assumption. I do that every day and I win." Pricing is the bane of any Recruiters existence and it can get disheartening and annoying. But not only have we had great months as of late at our agency, but our Recruiters are reporting more jobs and fewer fee fights
Are you Negotiable?
Rebuttal 1... "[NAME], I can’t change the price because I’m known in the industry by people who pay me my full fee, but I can accomplish the same thing by taking R5 000.00 off the total invoice if it’s paid by start date. Does that sound fair?" Rebuttal 2... "No [NAME], we’re at 20%. I’m happy to compete with other agencies that are charging less, and may the best recruiter win. Is that okay with you?" Rebuttal 3... "Not on the first one [NAME], but what I CAN do is give you my sliding scale discount, where you pay a full fee for the first one, to establish our relationship, but earn a continuing discount as we go. Does that sound fair?"
Negotiating after the fact!
I hate negotiating over fees. I get crazy over companies doing it after they have met a candidate, want to make an offer, and now prey on both your 1) desire for money 2) the implied guilt of costing a candidate, who is innocent, of his/her job offer. But before you decide what to do, you need to assess this client's value. What % of your overall business are they? If they are anything more than 20% of your annual billings you need to find a way to compromise, which is a gentler word for "do it their way". Because you have allowed easy business to be mistaken for good business. And now you can't afford to lose them. But if they are less than 20% of your business, and can easily be replaced by an emphasis on business development, you draw the line in the sand... "Just so I understand, I have been so effective in filling jobs for you, that rather than reward my efficiency I am to be punished by taking a lower fee? I have to tell you that as a matter of principle, I don't feel good about negotiating our price after the fact like this, when I forecast my efforts based on an agreed upon number, and when my candidate’s livelihood is at stake. If you had asked me earlier, and given me the choice to not work the job, I would feel differently. I won't change the fee in this situation. If you want to revisit this situation at a later date on a different search before we start working on it, I'm happy to do so. Does that make sense?” Hold the line. Every client you work with has a budget, a sales forecast, and wouldn't be profitable for long if they didn't abide by those frameworks. You are no different. When it comes to "after the fact", let your principled stand become your policy. They will cave nearly all the time. And if it makes you feel any better, they will forget this seemingly acrimonious discussion. It's gamesmanship.
When you're just not sure what to say...
When you're stuck for what to say, thrown out any of these Rebuttals (all versions of the same principle) Option 1... "Please understand, I’m not asking for the money upfront. All I’m saying is let me compete and take the risk myself, and know going in that I have to find a candidate worthy of my fee. What do you say?" Option 2... "I’m not asking you to pay me 20%. All I’m saying is when you consider that on a contingency basis the risk is mine, then all I’m asking is let me compete. Yes, I will charge 20% and they’ll charge much less, but all I’m saying is let me compete and you hire the best person. That’s what I’m asking". Option 3... "I’m not asking you to just accept 20%. I’m just saying, when you consider that I’m doing it on a contingency basis and the risk is mine, what have you got to lose? All I’m saying is let me compete. Let me send you my candidates, see theirs as well, and hire the best person. Does that make sense?" Options 4... "[NAME], I can’t work at that fee, because I’m known in the industry by clients who pay me more. But because I work on a contingency basis and the risk is mine, why don’t we say, you pay me 20%, but only if I get you the best person. Is that fair?"
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FEES decoded: listen in series
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Fees decoded: situational training
See it. Feel it. Try not to laugh too hard.
This is Recruitment Training with a bit of energy, and a healthy dose of sarcasm.
For recruiters who learn best when they can roll their eyes and take notes.
Fees decoded: read all about it!
For the “I’ll just read it later” crowd who actually does.
No video, no noise, no excuses. Just the full breakdown of every topic, technique, and tip, ready for you to digest and revisit when you need a refresher.
Read it. Highlight it. Pretend it’s serious work.
Recruitment training, your way. LISTEN to it, WATCH it, or READ it. Just don’t ignore it.
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