June 25, 2018

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Who Makes the Most Money

Which recruiter makes more money, retained or contingency? Generalist or specialist? Lone wolf or team player?

The answer? All of the above. The highest paid recruiters aren't necessarily tied to a particular approach to the business; nor are they the smartest or the hardest working. They're simply the ones who play to the strength of their respective business models.

Let me explain. The term "business model" refers to a unique combination of methods designed to turn a profit. If you're like most recruiters, your business model is already in place; it was taught to you during your first week on a desk.

Terms like "contingency," "retainer" and "generalist" merely describe the broad nature of each different business model; but it's the detailed inner formula-the business model and its implementation-that's really the key to success.

Most of the business models I've studied can provide a wealth-creating framework for the aspiring recruiter. These include the multi-desk franchise, the home-based solo operation, the split-network model, and so forth.

Occasionally, a business model can break down. For example, the resume-distribution model made lots of recruiters rich a few years ago when mid-level candidates were in short supply. When the market suddenly produced a surplus of candidates, the business model became obsolete, resulting in a riches-to-rags scenario for resume-blasting recruiters, no matter how hard they worked the system.

However, most recruiters fail not because of their system, but from fighting a system that already works. Chances are, your current business model works just fine. Remember, the characteristic common to top recruiters isn't that they all use the same system; it's that each works his or her system to the point of perfection.

Feeding the System

Take a good look at your system and what it needs to operate at maximum efficiency. If you feed the machine what it likes, you'll be rewarded. Starve it, and you'll be punished.

For example, a multi-desk office with five recruiters tends to reward conformity and punish non-conformity. The system works best when fueled by recruiter synergies, a homogeneous candidate population and economies of scale. So recruiters who work the same (or overlapping) desk specialties and generate split business will succeed more easily than non-conforming recruiters who try to orbit alone, outside the critical mass.

If you're not sure what to feed your system, ask your manager. If you run your own business, you may need to tweak your system to maximize your profits-or tweak your recruiters to maximize your system.

Whenever I attend a company or network meeting, I listen carefully to the top-producing recruiters as they accept their awards at the podium. And every time, it's like deja vu-the acceptance speech is exactly the same.

"Thank you very much for giving me this award," the winning recruiters say as they gaze at their silver trophies and Caribbean cruise tickets. "But I don't deserve all the credit.

"All I really did was work the system."

-Bill Radin, President
Innovative Consulting, Inc., Books, Tapes & Training for Recruiters
Phone: (513) 624-7501 - Fax: (513) 624-7502; E-mail: