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Why exclusive search is better than non-exclusive

When choosing the right method of searching for your company, it is important to understand the optimum search type. Many companies choose the more budget friendly non-exclusive search but this is not necessarily the most effective option. This blog post will explain why exclusive searches are the best and most reliable option.

What is exclusive vs. non-exclusive search?

Exclusive search means that only one agency is instructed to fill a vacancy while non-exclusive search means that several agencies are instructed to fill the same role. Non-exclusive search is based on the contingent business model: it is only profitable for the agency who successfully places a candidate. Exclusive searches on the other hand are mainly retained. Search firms usually get paid in three installments: at the beginning of the assignment, upon shortlist handover and upon successful placement.

Non-exclusive agencies don’t have time for “quality”

Let’s look at non-exclusive search from an agency's perspective. On one project, a client works with several non-exclusive agencies to fill one vacancy. This means that the agencies are competing, investing time and resources – even if it is limited - and risking a non-profit outcome as a stake for winning one project. The chances of winning a project for each agent is a slim chance of 10-20% on average (but can vary depending on the level of competition).

The agencies will therefore work on a lot of projects at the same time to maximise their chances of winning, causing them to invest more time and money into the totality of non-exclusive searches. The important part is the fact that non-exclusive agencies afford these projects by increasing their contingency search costs. And when they successfully make a placement, they charge the client a huge placement fee for their successful search, as well as to compensate for the financial cost of other lost projects.

What does that mean for the employer?

The shocking truth is that if you were a company paying a non-exclusive agency to execute a contingency search, you are also funding projects that benefit competitor companies. Not many clients understand this when hiring non-exclusive agents. One of the reasons why we recommend companies hiring exclusive-only agencies.

On the other hand...

Exclusive search incorporates a higher attention and engagement with the client which means that the client receives the best possible outcome.

You might wonder, how? Less agents are working on your projects, so it HAS TO be less effective!

But, since the search firm receives exclusivity and most of the times an upfront payment, that one search firm can do a lot more than just advertise jobs and screen candidates, and well, than just looking into their internal database. Exclusive search firms work as partners with their clients. They identify and apply relevant sourcing channels to find the right candidates, and they attract a higher number of applicants through premium job advertising.

But their real success lies in sourcing passive candidates. Who are passive candidates you might ask? They are the ones not actively looking for a job. A rule of thumb is that they make up at least 75% of the total workforce. That is a big number to ignore.

Interestingly, SpinUp Search has been sourcing active and passive candidates in parallel. Even though most of our sponsored job ads received over 150 applications in general, over 90% of our introduced candidates have been passive in general! Do you have a question about exclusive searches? Get in touch with us!

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