Two questions, no excuses
You lose business when you get these wrong
There are two questions that any client could and should ask you. Get them wrong and you’ve lost their business.
So you’d think recruiters would be really good at answering them. But when I ask hiring managers, they tell me most struggle.
Here are the questions:
How much do you charge?
Why?
On a scale of 1 to 10, how confident are you in your answers?
Here are the key mistakes I see recruiters make.
How much do you charge?
Most perm recruiters have a rate card in their terms… but even then, not all manage to answer this question well. Your clients are going to lose trust in you if you can’t clearly explain how much they have to pay.
One critical mistake is to undermine your rates. When you tell a client “our standard rates are…” or “we usually charge…” then you’re hanging a giant neon sign above your door telling them you’re willing to drop your prices. And in recruitment, the last thing we need to do is encourage our clients to push us harder on rates!
Another mistake is to push the question back on your client. Finding out “what’s your budget?” would be great in theory, but most clients a) don’t know, and b) aren’t going to tell you a number that works in your favour. Similarly, if you ask what they’re being charged by other recruiters then you’re suggesting your the same as every other agency (and there’s nothing to say the client will give you the whole truth either).
While the majority of recruiters I speak to can handle question 1, it gets a lot trickier when we come to question 2…
Why?
So you’ve told your client what you charge, as clearly and confidently as you can. But can you justify why you charge those rates?
First of all, you need to know how your rates sit in the context of your market. Are you expensive? Middle of the road? Cheaper than most? If you don’t know where you rank, it’s hard to know how your clients will react.
Second, where did your rates come from? Many recruitment leaders tell me their rates are the same as whatever they charged at their previous agency. But as they didn’t set the rates there, they don’t know why they were charging that price.
Third, and most important, you need to be able to justify your value to your client. This can’t just be things that are important to you; your client needs to hear an answer that they are willing to pay for.
Everything has changed
We are in the middle of perhaps the biggest upheaval ever in our industry, and it’s happening fast. If you can justify your fees and explain your value to clients, the rewards will be bigger than ever before.
Struggle to answer these two questions, however, and you’ll quickly fall behind. There are so many new ways to recruit, so many new tech tools that can compete on both speed and cost, that the only way to win is to focus on quality. Get that wrong and you’re out of the game.
Beat your score
If you want to take this threat seriously and work on your ‘why’ answer by yourself, I’m going to offer you a deal. Email me your score (out of 10) for the two questions, and in a month I’ll email you again to see how you’ve got on. Nothing is more motivating than knowing someone is going to check your work :-)
If, like me, you think this is too important to a) wait a month and b) do by yourself, reply to this email and I’ll explain how I can help you to justify your fees.
Either way, I look forward to hearing from you today.
Jon
P.S. I haven’t forgotten about temp and contract rates. They’re often more complicated than perm pricing but the core questions still stand: what do you charge, and why?
In a fast-paced temp deal, the client is less likely to ask these questions… but if you can’t give yourself the answers then the chances are you’re missing out.
If your business is predominantly non-perm, I’ll give you the same offer as above: you can email me your scores and I’ll come back to you in a month, or I can help you to justify your fees.