What Is a Retained Search and Is It Right for My Company?
As a company seeking to hire the best talent, you may find yourself weighing various recruiting models and agreements. Among these, you’ve likely encountered the term “retained search.” But what exactly does retained search mean, and how does it measure up against other recruitment solutions?
Here, we’ll explore the benefits of retained search agreements and help you decide whether it’s the right fit to secure the ideal hire.
What Is a Retained Search?
A retained search, also known as executive search, is a recruiting model where a company partners exclusively with one staffing agency to fill a position, typically for leadership roles or jobs that require a highly specialized skill set. Instead of waiting to pay until a hire is made, the company pays an upfront fee to kick off the search. This investment enables the recruiter to adopt a more measured and methodical approach, allocating more time to sourcing, screening, and engaging candidates who are not actively seeking employment but may be a perfect match. Retained searches are particularly useful when the hiring process requires confidentiality or when the stakes are high.
For example, we’ve successfully utilized retained agreements to fill hard-to-find executive roles in both the legal and healthcare sectors—industries where finding the right combination of experience, leadership, and cultural fit is challenging. These searches take time, but they often lead to long-term hires who make a big impact.
How Is Retained Recruiting Different from Contingency Recruiting?
| Feature | Contingency Recruiting | Retained Recruiting |
|---|---|---|
| Payment Structure | No fee unless a candidate is hired | Paid upfront (usually a portion of the total fee at the start) |
| Exclusivity | Often non-exclusive—multiple firms may work on the same job | Exclusive—only one firm works on the search |
| Type of Roles | Often used for mid-level or volume-based roles | Typically used for executive or hard-to-fill positions |
| Time Commitment | Faster turnaround, less in-depth search | More time-intensive, thorough, strategic search process |
| Incentive Structure | Incentivized to submit candidates quickly | Incentivized to find the best long-term fit |
| Risk Distribution | Higher risk for the recruiter (only paid if successful) | Lower risk for the recruiter (partially paid regardless of outcome) |
| Client Involvement | Less involved in strategy; often more transactional | Collaborative relationship; recruiter becomes a strategic partner |
| Candidate Experience | May be less personalized due to volume focus | High-touch, curated experience for candidates |
The difference comes down to the structure of the partnership. With contingency recruiting, agencies only get paid if a hire is made. It’s commonly used for mid-level roles and fast-moving hiring needs, where multiple agencies may submit candidates simultaneously. That creates urgency, but can also result in a high volume of resumes without the same level of vetting.
Retained recruiting works the opposite way. Because the agency is working exclusively and has already received a portion of the fee, they can focus on quality over quantity. The process is more targeted, slower, and often includes passive candidates who aren’t applying to jobs but are open to the right opportunity.
Both models have their place—it just depends on the role, the timeline, and how closely the client wants to partner with the recruiting team.
Related: What Is Contingency Recruiting?
How Exactly Are Retained Search Firms Compensated?
Under a retained search agreement, an agreed-upon percentage of the total fee is paid upfront to initiate the search process. The agency’s fee is usually calculated as a percentage of the prospective hire’s total annual compensation during their first year of employment.
For instance, if a company offers a starting salary of $100,000 for a role, the search firm may charge a fee of 25%, or $25,000. In some industries, bonuses and commissions are also included when determining the annual salary.
The client pays a portion of the fee upfront, with the balance invoiced at the end of the contract. This structure accommodates possible adjustments, such as if the advertised salary is $100,000 but the candidate negotiates it up to $110,000. In such cases, the remaining payment due would be revised accordingly.
Benefits of Working with a Retained Search Firm
Personalized experience
All recruiting relationships should come with some degree of personalization, but retained search agreements offer the ultimate tailored experience. Since the search is more rigorous, the firm typically takes on a more limited number of job openings, allowing them to focus more intimately on your search and keep you closely informed of its progress.
Furthermore, your up-front retainer demonstrates a high level of commitment to the search, which allows all parties to confidently put forth their efforts into the successful placement of the right candidate.
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Long-term partnership
Effective staffing partnerships resemble an extension of your company, aligning seamlessly with its interests and motivations. Retained recruitment is the perfect environment for developing such a relationship.
Through their close collaboration with your company, recruiters gain a comprehensive understanding of your needs, objectives, and values—the driving forces behind the search. This invaluable insight can be applied to current searches and future staffing requirements across various levels, where a similar context is crucial.
Discreet search process
For most open positions, it pays to cast a broad net and spread the word that you’re looking to hire far and wide. However, this isn’t always the case for high-stakes roles, such as executive-level positions.
Many candidates at this level often prefer not to let others know they’re looking for new opportunities. They may be unwilling to speak directly with a competitor of their current organization or may even have a contract that prevents them from doing so. In such a situation, the search firm serves as a neutral intermediary, making the introduction to the candidate and subtly gauging their interest in the position in a delicate manner.
The need for discretion also extends in the opposite direction. Often, as a company, you don’t want to make it widely known that you’re looking to fill such a high-level position or that a vacancy on your leadership team is imminent. Working with a recruiting firm on a retainer ensures your search remains private and minimizes the risk of sensitive company information falling into the wrong hands.
Conveys serious intent
Skilled workers are inundated with inquiries from recruiters hoping to connect, to the point where many ignore cold emails and connection requests on LinkedIn. A retained search, however, utilizes more nuanced sourcing techniques that differ from those in a run-of-the-mill job search.
The more personal, one-on-one process demonstrates to candidates that you’re serious and that their resume isn’t just one in a stack of hundreds you’re reviewing. This can put you in a better position to engage top candidates you might not be able to reach through standard sourcing methods.
Access to passive talent
According to a LinkedIn Hiring Solutions report, 70% of the global workforce consists of passive candidates—candidates who aren’t actively looking for a new job. And yet, these workers are often high performers who would make excellent candidates for the executive position you’re looking to fill.
Working with an executive search firm helps you connect with these and other hard-to-reach candidates who aren’t openly advertising that they’re job searching or may not have even considered it yet, but would be open to hearing about a new opportunity.
Retained search firms spend years making inroads in their respective industries, earning candidates’ trust, and building professional rapport. These relationships give them the standing to bring forth your opportunity and make a recommendation about working for your company that candidates will give thoughtful consideration to.
Related: Attracting Passive Candidates: Ways to Secure Top Talent
Exclusive representation
Retained search, unlike contingent search, where payment is based on successful placement, ensures that your chosen firm is the only one searching. This prevents the potential embarrassment of multiple recruiters contacting the same candidate and ensures your company is presented in the best light.
Specialized expertise
When you work with a retained search team, you’re not only gaining access to their executive headhunting skills but also their recruiting expertise. In your close working relationship, the right retained recruiting partner will function almost as a consultant, providing you with helpful insights and feedback honed through years of experience that will sharpen your hiring strategy.
A good retained search firm will ask you the right questions, prompting discussions that get to the heart of what you’re looking for in the perfect candidate. They’ll help guide your thinking about the necessary skills and characteristics, and potentially point out things you may not have considered that’ll aid you in identifying the perfect fit.
Related: The Benefits of Working with a Staffing Agency
Focused Recruiting for Your Most Important Hires
Your leadership team is one of your company’s greatest assets. The roles on this team are too important to leave to chance or guesswork. To fill your next executive-level or niche role, turn to the retained search professionals at 4 Corner Resources.
Our focus is always on quality over quantity, so we accept fewer requisitions to give greater attention to every placement. We take pride in being the most responsive and accurate in the industry, with a proven history of success to back it up. We’ve placed more than 15,000 candidates since 2006, and our reputation for results has earned us a 92% client retention rate.
Start your retained search with 4CR today by scheduling your complimentary consultation now.
