How Much Does a Headhunter Cost? The Complete Fee Breakdown for 2024

Executive search pricing is one of the least transparent areas of professional services. Firms rarely publish their fees, and the structures vary significantly. Here's the complete breakdown: Retained Search (Traditional): - Fee: 25-35% of first-year total compensation - Structure: Typically paid in three installments (1/3 upfront, 1/3 at shortlist, 1/3 at placement) - Guarantee: Usually 6-12 months - if the hire leaves, the firm replaces them for free - Best for: C-suite and VP-level searches at large companies - Example: For a CTO with $350K base + $200K bonus + $500K equity = $1.05M total comp, the fee would be $260K-$370K Contingency Search: - Fee: 15-25% of first-year base salary (not total compensation) - Structure: Paid only upon successful placement - Guarantee: Usually 30-90 days - Best for: Mid-level roles, high-volume hiring - Example: For a Director-level hire at $200K base, the fee would be $30K-$50K Marketplace Model (HireHunter): - Fee: Competitive with retained search but with more transparency - Structure: You see headhunter credentials and track records before engaging - Guarantee: Varies by headhunter, typically 6-12 months - Best for: Any executive search where you want multiple specialized options - Advantage: Compare multiple headhunters' fees, track records, and specializations before committing

Beyond the headline fee, be aware of these common costs and negotiation opportunities: Hidden Costs to Watch For: - Research fees: Some firms charge $10-25K upfront for market mapping, regardless of outcome - Expense charges: Travel, candidate entertainment, background checks can add 5-10% to the total fee - Exclusivity penalties: Some firms charge minimum fees even if you fill the role through other channels during an exclusive period - Off-limits policies: Large firms may have "off-limits" agreements that prevent them from recruiting from their other clients, limiting your candidate pool Negotiation Tactics That Work: 1. Volume commitment: Agree to multiple searches for a reduced per-search fee (typically 5-10% discount) 2. Success-weighted structure: Negotiate a lower retainer with a higher placement fee to align incentives 3. Capped fees: Set a maximum fee amount regardless of the final compensation package 4. Guarantee extension: Negotiate 12-month guarantees instead of 6-month 5. Milestone-based payments: Tie payment installments to specific deliverables (market map, long list, short list, placement) At HireHunter, our marketplace model creates natural price competition between headhunters. You see fees upfront and can compare across specialists. On average, our clients save 30% compared to traditional retained search while getting access to more specialized expertise.