I spent two very worthwhile days at the Recruiters Hub Conference in Sydney last week. Again, I was astonished at how few agency recruiters bothered to attend an event that was full of content specifically aimed at them. Those that did attend walked away with a significant competitive advantage, thanks to the generous sharing of information from all the speakers.
- What is the cost of acquiring each qualified candidate (ie after interview)? This cost would include such things as expenditure on candidate advertising and promotion, amortization of your database, interview room cost, consultant screening and interview time cost, etc.What is the cost of acquiring each qualified client? This cost would include such things as: expenditure on branding and promotion, amortization of your database, allocation of telephone costs, direct costs of client visits (eg petrol, train ticket etc), indirect costs of client visits (eg consultant time researching the client and travel time going to and from the visit), the cost of credit checks, etc.What is the cost of each placement/filled job? This cost includes all the costs listed above in acquiring qualified candidates and clients, as well as the consultant’s total time spent on both the filled assignments and also the unfilled assignments .In my experience, the companies that are all over this and both know and manage these costs very effectively, are those recruitment agencies who decline to take on contingent assignments or if they do take on contingent assignments they do so with a very clear understanding of the client’s commitment and the other job-filling strategies their client has undertaken.Working on multi-listed, contingent recruitment assignments without any attempt to qualify these assignments is akin to Russian Roulette; the odds seem in your favour to start with but the longer you play the more likely it is that you will take a bullet.Mindset Operations Director, Aaron Dodd recently invoiced a client over $1000 after he arrived at his client’s premises for an agreed meeting and the client was not in the office to make the meeting. And yes, the client did pay the invoice and still listed a very senior vacancy (retained) with Mindset. How about that for valuing your time? Although I am sure this is normal practice for lawyers and accountants.If every recruitment agency owner and manager clearly understood their cost of customer acquisition, I suspect the age-old practice of working on any old multi-listed, contingent assignment would start to very quickly decline in popularity as would managing recruitment consultants by numbers-only rather than by numbers and quality.The odds in the traditional contingent recruitment lottery are changing rapidly.What are you doing about it?A very smart place to start would be knowing your cost of customer acquisition and then have your team understand very clearly where, and with whom, they should be investing their precious time.