Shake the Stigma: Splits Are Good Business

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shaking it offMost recruiters I know, the majority of whom work for agencies, have a long standing stigma against the idea of “splits”. The split seems to carry with it the idea of concession. Concession of control, ability, success, status, revenue, etc.  These are all very valid points given the very simple fact that, when you engage in a split placement, you lose half of your revenue. A recruiter’s best case scenario is to bring in their own business, fill it themselves and take whatever cut they are entitled to based off of 100% of the revenue generated…we all know this. While I agree that splits can hurt in one scenario, if you work a split-fee network the right way, you can greatly increase your revenue with very little extra effort. Closing the door on splits will cost you easy money.

How to leverage a split-fee network into more placements and higher revenues:

1) Use a split-fee network to market and place your “leftover” candidates

This is the single most glaring reason to partake in splits. For some recruiters it will be the only reason. Every recruiter who says “I don’t do splits” cannot be thinking of this application when they make that statement. Why wouldn’t you? Even the best, most efficient, niche oriented recruiters create a tremendous amount of leftover candidates. It’s just the nature of the beast. You recruit for a job, fill it with one person and can have dozens of great candidates leftover. There are always more “leftover” candidates than any recruiter can place. Most of the time those candidates fade into the recruiting abyss. Since you have done all the work, get those (encrypted) profiles posted to a split-fee network so recruiters from across the country can review them. Someone, somewhere is going to place a candidate you have sourced…with, or without you. Why not toss a bunch of lines in the water with bait you’ve already cut and let someone else come along and do some work for you? It is a great way to attract some residual value with little effort from candidates you would otherwise toss in the “I’ll get back to someday” file.

2) It’s not necessary to offer all of your jobs for splits (such as your niche job orders)

First and foremost, you should try and make your own placements and get credit for 100% of the revenue generated. Some of you will never use a split-fee situation to make any placements with your clients. Good for you…seriously!  However, you will still have leftover candidates from your search.  A split network can help you place them.

3) Use a split-fee network if an established client comes to you with a req you typically wouldn’t work

Plenty of times during my recruiting career (IT specific) I would have clients come to me with reqs outside of IT. Two things would happen here: either I would respectfully decline…or, I would spend time spinning my wheels trying to generate candidates for a space I was not familiar with. Both cases we not particularly beneficial to revenue production. Working with a split-fee network can allow you to effectively leverage other people’s specialties to drive delivery. It’s a winning situation.

4) Use a split-fee network if you are bringing in more business that your recruiting team can handle

If you don’t have the working capital to support additional headcount, split networks are a great way to engage a scalable recruiting force for your company. As needs ebb and flow, you can engage recruiters via splits to help satisfy your requirements list. Once you are ready to bring on a new person, scale back your use of splits. Do the math though. Figure out what an internal recruiter will cost you after salary, payroll tax, commission, benefits, time, etc… and be sure you are not paying more to a full time hire than a split relationship would cost you!

5) Use a split-fee network if you have no sales function

No sales force? Just want to recruit? Jump on a split-network and start building relationships with the recruiters who are positing jobs. These are recruiters who are looking for recruiter help! The split-fee network has now become your sales force. Foster a few good relationships and you’re off to the races.

Shake the stigma – drive revenue!

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