The three pricing models
Nearly every recruitment engagement in India runs on one of three structures. Knowing which one you are in tells you most of what you need to know about how the agency will behave.
Contingency
You pay only when a candidate joins. Fees commonly sit between 8.33% and 16.67% of the candidate's annual CTC, with a replacement guarantee of 60 to 90 days. The lower end of that range tends to appear on volume roles and the upper end on specialist ones.
The attraction is obvious: no hire, no invoice. The cost is less obvious, and it is structural. An agency paid only on placement carries all the risk, so the rational response is to spread that risk across many clients and send volume, hoping something lands. That is why you receive twenty CVs and end up doing the screening yourself. You are not being badly served by a bad agency. You are being served exactly as the pricing model rewards.
Retained
You pay in stages, typically a third at engagement, a third at shortlist and a third on joining. Used for leadership, confidential and genuinely scarce roles. Total cost is usually higher, often 20% to 33% of CTC.
What you are buying is exclusivity and attention. A retained recruiter is not hedging across six other clients with the same brief, which means they can afford to spend time on market mapping and on the candidates who are not looking.
Volume or per-hire
For drives where you need many people in one window, pricing usually moves to a flat fee per hire rather than a percentage. Rates fall as numbers rise. Sensible for plant ramp-ups, new shifts and seasonal peaks.
What actually moves the number
Fee quotes vary far more by role than by agency. The things that push a price up:
- Scarcity. How many people in the country can genuinely do this job, and how many of them are reachable.
- Seniority. Senior searches take longer, involve more stakeholders and carry a higher cost of failure.
- Confidentiality. Replacing someone still in post cannot be run as an open search.
- Location. A plant role an hour outside the city has a smaller willing pool than the same role in the city, regardless of salary.
- How well the role is defined. The most underrated factor, and the one entirely within your control. More on this below.
The line item nobody quotes you
Fee is the visible cost. It is rarely the largest one.
Run a realistic set of numbers through our cost of a bad hire calculator and the recruitment fee typically lands somewhere between a tenth and a fifth of the total cost of a hire that does not work out. The expensive lines are the ones nobody invoices you for: salary paid to someone who was never going to succeed, the months the seat sat empty, and the management hours spent on a problem that a better-defined role would have prevented.
Which is why choosing an agency on fee alone is usually the expensive decision. A two percent difference in fee is noise against the cost of one wrong hire.
What a badly defined role costs
We can put a number on this, because we have run the same method against a brief that held still and a brief that did not.
On a sales role where the mandate stayed fixed, we screened more than forty profiles, shared eight in two batches of four, and the client hired from the second batch. Twenty-five days from intake to the person starting.
On a factory manager search where the mandate changed mid-way, we screened over a hundred profiles and shared twenty to twenty-five. Roughly forty-five days to joining.
Same recruiter, same process, roughly three times the submittals and nearly twice the timeline. Nobody behaved badly. The role definition moved, and every profile screened against the old definition stopped counting. If you want a search to be cheap, the highest-leverage thing you can do is spend an hour getting the brief right before anyone starts sourcing.
Questions worth asking before you sign
- What is the fee, and what exactly triggers it?
- What is the replacement guarantee, and what voids it?
- How many other clients are you running this same brief for right now?
- How many profiles will I see, and how many will you have screened to get there?
- What happens if you decide the compensation band will not clear the market?
- Who actually does the screening, and will I speak to them?
The third and fourth questions are the revealing ones. An agency running your brief across several clients simultaneously is optimising for their portfolio, not your role. And an agency that cannot tell you its submittal-to-hire ratio has probably never measured it.
How we price
We scope fees to the role rather than applying a flat percentage, and we confirm them in writing at intake before any sourcing begins. There are no upfront fees. If we think the compensation band will not clear the market, we say so in week one rather than week six, which is a harder conversation early and a much cheaper one.
More on what we commit to, and what we need from you, on how we work.
Read next: How we work, and the numbers behind it ยท Cost of a bad hire calculator