THE BRUTAL TRUTH #29

THE BRUTAL TRUTH #29.

by Howard Greenwood, 19th June 2024

Welcome to edition #29 of THE BRUTAL TRUTH. In this edition, I examine why we should stop working on roles that we cannot or are unlikely to fill and then consider the thorny subject of whether we should drop our price to attract more work as the market starts to recover.

Why Recruiters Should Cease Working on Uncommitted Client Roles: A Call for Professional Integrity and Efficiency

When will recruiters learn that time and resources are your most precious assets? Yet, far too often, recruiters find themselves working for clients who are either not committed to the recruitment process or offer roles with minimal chances of successful placement. This practice is not only inefficient but also detrimental to the recruitment industry’s credibility and sustainability. It’s time for recruiters to take a stand and prioritise their efforts towards roles that promise mutual commitment and realistic chances of success.

The Cost of Uncommitted Clients

Uncommitted clients are a drain on resources. These clients typically exhibit erratic communication, unclear job descriptions, and inconsistent feedback. The cost of chasing such clients can be astronomical, encompassing wasted hours, diminished morale, and financial losses. Recruiters, we are professionals whose expertise and time should be respected. When a client demonstrates a lack of commitment, it clearly signals that they do not value the recruiter and their Client Value Proposition. Continuing to work with such clients is akin to endorsing their unprofessionalism and setting a precedent that undervalues the recruitment profession.

Efficiency and Focus on High-Value Opportunities

The recruitment process is intricate and demands precision, dedication, and significant effort. By focusing on high-graded opportunities—roles with committed and transparent clients—recruiters can allocate their resources more effectively. High-value clients understand the recruitment process, provide clear and realistic job descriptions, and offer timely feedback. This collaboration ensures a smoother recruitment process, leading to higher placement ratios and a stronger professional relationship.

Reputation and Industry Standards

The recruitment industry thrives on reputation, which is, in the main, a bad one. A recruiter known for wasting time on low-probability roles risks damaging their professional standing. Conversely, recruiters who are selective and strategic about the roles they undertake build a reputation for efficiency and success. This not only attracts better clients but also elevates industry standards. By refusing to work on roles with minimal placement chances, recruiters signal to the market that they are serious professionals who value their time and expertise.

Ethical Considerations

There is also an ethical dimension to consider. Recruiters owe it to the candidates they represent to provide them with genuine opportunities. When recruiters work on roles with low placement chances, they inadvertently mislead candidates, wasting their time and potentially harming their career prospects. Ethical recruiting practices demand transparency and honesty, both with clients and candidates. By refusing to entertain non-committal clients or unrealistic roles, recruiters uphold their professional integrity and foster trust within the industry.

Building Stronger Client Relationships

Ironically, saying “no” to uncommitted clients can strengthen client relationships. It forces clients to respect the recruitment process and understand the value of mutual commitment. Clients who are serious about filling roles will appreciate the recruiter’s stance, leading to more fruitful collaborations. Moreover, this approach filters out clients who are not serious, allowing recruiters to build a portfolio of reliable and committed clients.

In the main, recruiters tend to bend to the power of the client, but recruiters who prioritise their professional integrity, efficiency, and ethical standards by refusing to work on roles for clients who are not committed or offer minimal chances of successful placement understand the power of the recruiter. This strategic focus enhances their reputation and ensures the best use of their resources, leading to better outcomes for all parties involved. The recruitment industry must collectively adopt this stance to elevate its standards and ensure sustainable success. It’s time for recruiters to take control, demand respect, and work smarter, not harder. It is time recruiters understand they have the power; we should stop talking about a client or candidate market and take the power back to create a recruiter market. A market where we have the power and clients and candidates respect our industry.

Navigating Recruitment Market Fluctuations: Why Recruiters Should Resist the Race to the Bottom

Recruiters, recruiters, recruiters! Market conditions can shift rapidly. Economic cycles, industry disruptions, and labour market trends all influence the demand for recruitment services. During downturns, it’s common for recruiters to experience a lull in activity. However, when this downturn transitions into an upturn (it is starting to happen), a critical juncture presents itself: should recruiters drop their prices to attract more clients, or should they maintain or even raise their fees while enhancing their services?

The Pitfalls of Price Dropping

Lowering fees may seem like a straightforward strategy to gain a competitive edge. However, this approach can lead to several detrimental consequences:

  1. Devaluation of Services: Lowering fees can signal that the services you provide are not worth their original price. It can also erode the perceived value of the recruiter’s expertise, experience, and network. Clients can, therefore, continue to view recruitment services as a commodity rather than a specialised and strategic function they actually are.
  2. Unsustainable Practices: A fee reduction can set a hard-to-reverse precedent. Once prices are lowered, it becomes challenging to raise them again without risking client dissatisfaction or loss. This can lead to a continual undercutting cycle, damaging the overall market for recruitment services.
  3. Quality Compromise: Lower fees often mean less revenue to invest in quality enhancements. Recruitment involves significant resources—time, tools, and talent. To maintain profitability at lower fee levels, recruiters might cut corners, which can compromise the quality of candidates presented and the overall service provided.
  4. Market Perception: Engaging in a price war can tarnish a recruiter’s reputation. Clients might begin to perceive recruiters as desperate rather than as trusted advisors. This perception can damage long-term relationships and reduce the likelihood of repeat business or referrals.

I have often said that poor recruiters have the warmest ankles. The client asks and, in most cases, doesn’t even demand a cut in fees or rates, and immediately, the recruiter drops their “pants” for the client. This leads to recruiters tripping up constantly, as it is hard to manoeuvre when your ankles are tied together.

Holding the Line and Enhancing Value

Rather than lowering fees, recruiters should focus on maintaining or increasing their fees while enhancing the value they offer. This strategy is sustainable and beneficial for both recruiters and their clients. Here’s why:

  1. Reinforcing Expertise and Value: By maintaining or raising fees, recruiters signal confidence in the value of their services. This strengthens their positioning as experts who provide strategic value rather than mere transactional services. Clients are more likely to respect and trust recruiters who stand by the worth of their services.
  2. Investment in Quality: Higher fees enable recruiters to invest more in their operations. This can include better technology, more comprehensive candidate assessments, enhanced training for their team, and more robust market research. These investments translate into better service and superior candidates for clients.
  3. Differentiation Through Service: In a competitive market, differentiation is critical. Recruiters who focus on providing exceptional services (a great Client Value Proposition CVP)—such as personalised consultations, detailed market insights, and robust post-placement support—can justify higher fees. Clients often pay more for a premium service that delivers tangible results and value.
  4. Building Stronger Relationships: Clients who understand the value of high-quality recruitment services will likely be more committed and loyal. By focusing on value rather than price, recruiters can build stronger, more collaborative relationships with their clients. These relationships are crucial during market upturns when demand for talent surges.
  5. Sustainable Business Growth: Maintaining or increasing fees supports sustainable business growth. It ensures that recruiters have the resources to continuously improve their services, stay competitive, and adapt to changing market conditions without compromising their standards.

The temptation to lower fees can be strong as the recruitment market transitions from a downturn to an upturn. However, this approach is fraught with risks and can lead to a detrimental race to the bottom. Instead, recruiters should focus on holding their fees while enhancing the value they offer. By doing so, they can reinforce their expertise, invest in quality, differentiate their services, build stronger client relationships, and ensure sustainable business growth. In the long run, this strategy benefits recruiters and serves their clients more effectively, creating a win-win scenario in an ever-evolving market where service is becoming the differentiator recruiters seek. So, as a recruiter, ask yourself this question:

Do you ever question a price if the service you have received is exceptional?

Thank you for reading this edition. I would love to hear your comments and hear about your experiences working with poor clients and dropping your fees.

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