Welcome to edition #34 of THE BRUTAL TRUTH. On my travels, I meet and work with numerous recruitment agencies of all sizes, working for all types of clients, from major blue chip companies to start-ups, and often, that same conversation happens. How do you handle every kind of client, and do you categorise them based on your working relationship? If so, what actions do you take? NO, really, what actions do you take? Do they see you as a prospect to work with or treat you like a suspect? Read on to find out the questions you should ask yourself to know if you have a relationship with your clients or just a transactional trading account.
The Four Types of Customers in Recruitment Business and How to Deal with Each
In the recruitment world, understanding your clients is crucial for success. Recruitment agencies deal with a diverse clientele, each with unique needs and expectations. Tailoring your approach to these distinct types of clients can help build stronger relationships, improve client satisfaction, and drive business growth. Recently, I have come to the conclusion that lots of recruitment businesses do not truly understand what relationships they are in and with what type of clients or how to work with them. There are four primary types of clients most recruitment businesses work with, along with ways of working with them—from those who are a pleasure to work with to those who are more challenging.
The Large Corporate Client
- Large corporations often have well-established HR departments and may work with multiple recruitment agencies.
- They typically have ongoing hiring needs, requiring a steady stream of candidates across various roles.
- These clients value efficiency, compliance, and a strong alignment with their corporate culture.
- Build Long-term Relationships: Establish a dedicated account management team to ensure consistent communication and service quality. Understanding the client's business culture, values, and long-term goals will help provide candidates that fit the role and the company.
- Leverage Technology: Use advanced recruitment software to manage large volumes of applications and provide detailed analytics on recruitment performance. This helps maintain transparency and show the value your agency brings.
- Compliance and Consistency: Ensure that all recruitment processes adhere to legal and ethical standards. Large corporations often have strict compliance requirements, and meeting these consistently will build trust and credibility.
- Great to Work With: Large corporations that value partnerships and provide clear, timely feedback. These clients are collaborative and respect your expertise, making the relationship rewarding. Communication is high across the whole business, fees and margins are profitable, they pay on time, and you constantly communicate and plan together.
- Just Customers: Corporations that see you as just another vendor and are more transactional in their approach. They might be loyal but require constant reminders and may not fully appreciate the added value you bring. Communication is via a single point. They have demanding SLAs, tight fees and margins, and they pay late.
- Pain to Work With: Overly demanding Corporations, change requirements frequently, or have unrealistic expectations. These clients may also slow down the process with bureaucratic hurdles, leading to frustration. Communication is via a single point or portal; you can not speak to the line. CVs go into a black hole, contact is poor, fees and margins are very low, and getting paid is challenging to be polite.
- Great Clients: Invest in deepening the relationship. To cement the partnership at all business levels, offer additional value, such as market insights or exclusive candidate access. They welcome your suggestions and involve you in planning to use your market knowledge. I have had tremendous results and built long-lasting relationships.
- Just Customers: Focus on maintaining professional efficiency. Deliver high-quality candidates consistently, but only over-invest in extra services if there's a clear sign of interest from their side. I didn't convert them all, but I did some. However, they came and went, as they were always looking for more for less.
- Painful Clients: Set clear boundaries and expectations from the start. Document all communications and be prepared to push back when demands are unreasonable. If the relationship becomes unmanageable, consider whether it's worth continuing. These clients eat your time and have a low return on investment. Consider if these types of clients are producing the return on investment you require for a consultant's time and effort, which could be more cost-effective elsewhere. I sacked off lots of these and realised the time it gave me to invest in my better clients gave a better return on my investment. I have to admit, I enjoyed professionally walking away.
The Small to Medium Enterprise (SME) Client
- SMEs usually have smaller HR teams or may need an in-house recruitment function altogether.
- Their hiring needs may be more sporadic but critical to their growth and sustainability.
- They often seek personalised service and a deeper level of partnership with their recruitment agency.
- Personalised Service: Offer a more consultative approach, guiding them through the recruitment process and helping them define their hiring needs. Flexibility and adaptability to their changing requirements can set you apart from competitors.
- Cost-Effective Solutions: SMEs are often budget-conscious, so offering cost-effective solutions like bundled services or flexible payment terms can be appealing. Highlighting your services' return on investment (ROI) can also be persuasive.
- Agility: SMEs may need to move quickly when hiring, especially when they find a candidate they like. Being responsive and agile in your recruitment process is crucial to meeting their timelines.
- Great to Work With: SMEs that value your guidance, provide prompt feedback and appreciate your personalised service. These clients often become loyal partners and offer repeat business. You have an open dialect with all recruitment and buying points in the company, and you are treated like a prospect and not a suspect.
- Just Customers: SMEs that use your services when necessary but don't engage beyond the basics. They may shop around for the best deal and switch agencies frequently. You deal with HR or recruitment, but they see you as a suspect and treat you as one.
- Pain to Work With: Indecisive SMEs frequently change their minds or have unrealistic expectations about costs and timelines. They might also struggle to define their hiring needs, making the process cumbersome. They are slow to pay and have a high staff turnover.
- Great Clients: Nurture these relationships by offering additional support, such as helping them with employer branding or providing HR resources. They are likely to appreciate and reward your efforts. Develop their EVP to help market their employee brand into the candidate marketplace. I gained high rewards for years and cultivated relationships that moved from job to job.
- Just Customers: Maintain professionalism by developing the relationship. Focus on efficiency and clear communication to keep them satisfied without overextending your resources. Work hard to build your service relationships with key stakeholders and decision-makers so they see you as a prospect to turn them into great clients. Again, I tried to convert these and got mixed results.
- Painful Clients: Be firm but supportive. Help them clarify their needs but keep them from draining your time and resources. If they consistently cause issues, consider whether they are worth the continued effort. Over time, either sacking them or bringing innovation to their recruitment processes made or broke the relationship, but I worked to my terms rather than theirs.
The Start-up Client
- Start-ups often have minimal to no HR infrastructure and may be new to the recruitment process.
- They are typically fast-paced, with a need to hire quickly as they scale.
- These clients may have less clarity on their hiring needs and require more guidance.
- Education and Guidance: Start-ups may need help defining job roles, creating job descriptions, and understanding the recruitment process. Offer educational resources or workshops to help them navigate these challenges. They also need help developing an EVP that attracts and retains employees.
- Flexibility: Start-ups may have fluctuating needs and budgets. Be willing to offer flexible contracts, trial periods, or discounts for bulk hiring. Demonstrating an understanding of their unique challenges will build loyalty.
- Focus on Fit: Culture fit is often more critical than skills for start-ups. Understand the start-up's vision, values, and team dynamics to ensure you're placing candidates who align well with their culture.
- Great to Work With: Start-ups that are innovative, open to ideas, and appreciative of your support. They often provide exciting opportunities for creative recruitment solutions and can grow into major clients as they scale.
- Just Customers: Start-ups that use your services to fill urgent positions but need more commitment to building long-term relationships. They may be price-sensitive and quick to move on if they find a cheaper or faster option.
- Pain to Work With: Start-ups with unclear objectives, unrealistic expectations, or constant shifts in direction. They may struggle with decision-making, leading to frustration and delays in the recruitment process.
- Great Clients: Engage deeply with these start-ups. Offer strategic advice on scaling their teams, and position yourself as a trusted partner in their growth journey. Invest in building key relationships; as the business grows, do not become complacent. I grew some mighty oaks from small acorns based on building trust and providing excellence.
- Just Customers: Provide efficient, straightforward services. At the same time, it's important to deliver quality. Only over-invest in the relationship if they show signs of wanting a deeper partnership. Your MO should be to build a deeper collaboration or manage it. I found these hard to crack, so I invested only when I felt invested.
- Painful Clients: Set clear expectations from the outset. Help them refine their hiring process, but be ready to walk away if they become too disruptive to your business operations. I walked away quickly and professionally; I never want to be the patient saint of lost causes.
The Niche Industry Client
- Niche industry clients operate in specialised fields, such as technology, healthcare, or finance, where specific skills and qualifications are essential.
- They often require highly skilled candidates with a deep understanding of their industry.
- These clients value expertise, confidentiality, and a tailored recruitment approach.
- Industry Expertise: Demonstrate your understanding of the niche industry. This could involve having recruiters with industry-specific knowledge or providing case studies of past successful placements in similar fields. DATA, DATA, DATA, use it to demonstrate your expertise.
- Tailored Recruitment Strategies: Customise your recruitment approach to meet the industry's specific demands. This might involve targeted sourcing strategies, specialised assessments, or a focus on passive candidates.
- Confidentiality and Discretion: Niche industries may require discretion, especially when recruiting for high-level or sensitive positions. Ensuring your processes are secure and confidential will build trust with these clients.
- Great to Work With: Niche clients who respect your expertise and provide detailed briefs, leading to a smooth recruitment process. They value long-term partnerships and are likely to stick with you for future hires. They will consider different recruitment strategies based on each position you work. These were my most profitable clients, and this is where I invested my time heavily.
- Just Customers: Clients who use your services as needed but don't fully engage beyond the basic requirements. They may not see the value in the tailored approach and treat the process as transactional. I chose to
- Pain to Work With: Niche clients with unrealistic demands, such as expecting rare skills at low prices or those who are overly critical of candidates. They may also require constant reassurance and updates, leading to a strain on resources.
- Great Clients: Continue to build on the relationship by offering insights into market trends and proactive solutions to potential hiring challenges. These clients are worth going the extra mile for. Build bespoke recruitment services so you are innovating with them.
- Just Customers: Deliver precisely what they need without overextending your resources. Maintain professionalism, but focus on efficiency rather than deepening the relationship unless they express interest. Learn from your Great Clients and build.
- Painful Clients: Maintain a professional stance, but don't hesitate to push back on unrealistic demands. Set clear terms and conditions to protect your time and resources. If the client continues to be overly demanding, consider whether they are a good fit for your business.
Adapting to different types of customers and clients is crucial in the recruitment world. Whether dealing with large corporations, SMEs, start-ups, or niche industry clients, it's essential to recognise their unique needs and their behaviour and attitude towards your services. By tailoring your approach to the specific type of client—whether they are great to work with, just customers or a pain—you can maximise your success, build stronger relationships, and ensure your recruitment business thrives. Invest in those clients who invest in you, and try and get those who show potential to see you are a prospect to work with; TRUST is critical for all clients but for those who eat your time and make a decision to work with them based on your return on investment, not the vanity of turnover or the client's name.
Most recruiters have a transactional relationship with their clients, not a loyal one. To test your relationship, ask yourself the following:
- Were you invited to the meeting when your client was planning their headcount for the next 3, 6, or 12 months?
- Do the business's key stakeholders know who you are and pick up the phone when you call?
- Have you received an unsolicited testimonial from your key clients?
If you answer no to two of these questions, you have a transactional relationship at best.
Do you want help to build your services and develop your relationship, or do you need guidance on how to develop or sack those clients who do not make you money or treat you like a suspect? Contact Jump to learn how to become your own master.
