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Contingency search firms get paid when they place a candidate. Consequently, they tend to act in a transactional manner and focus only on active candidates. As such, they often misunderstand or disregard the company’s needs and tend to focus on filling lower-level roles.

In contrast, retained search firms are paid over the course of the project and work more closely with you. They tend to better understand your company and your unique hiring needs. They take the extra time to find the best candidates, including passive candidates. As such, they particularly excel in executive and strategic searches.

Check out this blog post for more info on the difference between contingency and retained search.

Active candidates are actively looking for work, meaning they are looking on job boards and submitting their resume. Often they aren’t currently employed. Contingency search firms tend to focus on these candidates because they can be placed quickly and the firm can get the fee before a competing firm or a candidate is placed in-house.

Passive candidates aren’t looking for work, they are already employed, and they aren’t looking on job boards or submitting their resume. Contingency search firms don’t consider these candidates because they take too long to place. Yet, these are the best candidates for executive and strategic roles. Retained search firms excel at finding and placing these candidates.

It’s to ensure a collaborative relationship with you. Both parties need to be aligned around finding the best candidate, regardless of where they come from.

Note that exclusivity doesn’t mean the candidate can’t be sourced from outside the search firm. If they are, the firm will still provide a lot of value as the candidate goes through the process.