What does outsourced recruitment cost? We look at the RPO pricing models.

Recruitment Process Outsourcing (RPO) is often looked at a cost saving initiative for those with substantial volume of hires or large agency spend. Although pricing is only one of many reasons an RPO could be right for your business, it often leads or inspires the decision making process. We look at how RPO's are potentially priced and the financial considerations. 

When does an RPO make financial sense?

The growth of outsourced recruitment in the last decade has meant innovative models have appeared, changing the entry point to RPOs. They are no longer just for enterprise level customers, but cost efficiencies can be made for companies of all sizes. Depending on hiring needs, different products can be provided to meet your volume or requirement, for example our services includes;

Core RPO

Available for customers looking for a medium to long term solution for repeat or varied hiring. 

Project RPO 

Built for short term demands, for example a quick growth project or a short-term hiring need. No long-term commitments. 

Embedded RPO

For when you need an expert recruiter on site, along with the infrastructure of an established provider behind them. 

RPO Pricing Models

Outsourced recruitment pricing typically fits into one of the following categories: 

Per Placement 

This model charges on a per placement basis, either structured as a flat fee or a varying based on the salary. This can further be structured into stages of fee's (e.g. upon releasing a requisition), and also be combined with Management Fee's.

Management Fee 

A repeating fee, typically on a monthly basis, to cover the core services associated with your RPO. This fee typically varies depending on the level of service, volume of hires and location requirements. 

Flexible & Hybrid Fee's 

With an increase in the need for flexibility in today's market, hybrid pricing models have emerged and typically are a blend of a per placement fee and management fee's. These fee structures are great for varying volumes of hiring and unique requirements your organisation may have. 

Factors that may influence your RPO pricing 

Typically, RPOs are priced on a case-by-case basis, here are factors that may influence your pricing model;

Volume of Hires

The most simple of metrics, the volume of hires you need is typically the biggest factor in the RPO pricing. 

Location & Seniority of Hires

Your RPO could be local or multi-national, required a spread of volumes across a spread of locations may effect your pricing structure. 

Predictability

Your hiring demands may fluctuate, whether a seasonal effect or annual budget requirements. This can change or influence your pricing model, you may choose to look for a more predictable model for cost-control, or more variable to flex with your needs. 

Objectives

Your strategic objectives can be baked into the service offering an RPO, typically things like talent pooling are considered standard within outsourced recruitment, however the more requirements, the more it may impact your pricing. 

Are RPOs priced right for you?

Today's RPO landscape is bringing flexibility and innovative pricing with it being more accessible than ever to SMEs rather than just enterprise customers. If you're a first generation RPO customer, it may come at a surprise how appealing outsourced recruitment can be, or if at renewal there may be more competitive and suitable solutions out there. More than likely there's a cost effective RPO solution no matter what your needs. 

For more information, download our RPO guide here.