What does the process look like when you put all the pieces you have given us together? You are saying elements of greatness, and I want to put it all together in a better way. —Jen
It’s a great question. We will map that out with you if you are a current client. I am just giving you answers to questions in the Inner Circle Club. In our Ignite and Platinum programs, we create the roadmap together so that you are in the right niche, have the right metrics, coach you on your mindset, and coach you on your business strategy. First, we look at where you are, determine where you want to be, identify that gap, and outline exactly the next steps for you to take.
When you put it all in place, the process is to develop your niche, understand your metrics, hit your activity targets, and make investments based on your business goals and metrics. We know that in this economy, we still have not seen any change in the metrics. You will get a job order for every 12 marketing conversations, even in a new niche. You can then determine if you want to earn money upfront; our clients have very little resistance to getting a deposit-based search.
Understand Your Metrics
Let’s say it is pure contingency and your job order to placement ratio is 4 to 1. You take a job order a week, meaning what do you need to do? On average, you need to talk to 3 prospects a day, 15 a week. That will give you one job order you can search on. If you take 4 job orders a month that you can search on, you will make one placement a month and get an average fee of $25,000. This is what we see in our client base right now. Some are $20,000. Some are $30,000 – $40,000.
Hit Your Activity Targets
What does that look like implementing it? If you want to bill $300,000 or a desk to bill $300,000 with an average placement fee of $25,000 and an 8 to 1 first-time interview (FTI) to placement ratio. Most of our clients are in the 6 to 1 range, but I am being conservative with a ratio of 8 FTIs to placement, so that recruiter needs to, or you need to, arrange 2 first-time interviews per week. If you arrange 2 first-time interviews per week and those ratios are true for you, once we measure those, I bet a huge chunk of my investment portfolio that you will be at $300,000 or greater at the end of the year. I have never seen it not happen. That is the key.
When you stop focusing on placements and start focusing on activity, and knowing what the activity goals are to hit your revenue goal, then you are not stressed – I shouldn’t say not stressed out – we are always a little bit stressed out. You know you are on target to hit your revenue goal. You know precisely when your day is over.
Trust the Process
We had a few clients at our Mastermind in Boston, and their revenue was a little lighter the last couple of months, and they said, I am not worried. I’m like, why? They said, well, in the last couple of months, our interview-to-placement ratio has spiked to 10 to 1. We are typically a 5 to 1, so I am due for 5 placements at a firm level. I said, alright if I check in with you by the end of the quarter, most of those will probably be there. It always happens.
When you put it all together, if we go back to the beginning, you have defined a niche you are targeting. You are talking to 3 prospects a day to get 2 interviews a week. At 15 to 1, you must talk to 30 candidates per week. That is 6 a day, so you have 9 conversations per day, 3 with prospects, 6 with candidates. Statistically, that will lead to a placement a month. This business is not that perfect, meaning they do not land every month. You might blank two months and make 3 in one month, but you will average a placement a month and have $300,000 billed by the end of a 12-month period.
Invest Based on Goals and Metrics
The other good news is that you can make business decisions on investing. Once you create that consistent revenue, you will leave money on the table. You can ask yourself if you want to hire a sourcer to recruit on your openings because you cannot get to them all, even as a solo operator. We had a number of solos that finally see the light go on, that they can hire somebody virtually, even part-time, to give them searches that they do not have time to get to that can add an interview a week. If they add an extra interview a week, they are adding $150,000 in revenue a year, and you are not working any longer or harder.
You can now use those metrics as benchmarks to hold people accountable and forecast your revenue with 95% certainty. Their interview-to-placement ratio will be the same as yours because it is your desk where you manage the quality of the candidates. You are going to determine who to submit.
Start the Journey
I would take this question and go in deep with one of our growth consultants on what you want to create in your business. We will be thrilled to do that for you. Click here to schedule a free strategy session.
P.S. Whenever you’re ready… here are 4 ways I can help you grow your recruitment business:
1. Grab a free copy of my Retainer Blueprint
It’s the exact, step-by-step process of getting clients to give you money upfront. https://get.therecruiteru.com/lm
2. Join the Recruiter Think Tank and connect with firm owners who are scaling, too. It’s our Facebook community where smart recruiters learn to make more money and get more freedom. https://www.facebook.com/groups/there…
3. Join me at our next event
3x a year, I run a 3-day virtual intensive, sharing the 9 key areas that drive a 7-figure search firm. Click here to check out the dates of our upcoming event. https://get.therecruiteru.com/emerge
4. Work with me and my team privately
And if you ever want to get some 1:1 help, we can jump on the phone for a quick call and brainstorm how to get you more leads, more placements, and more time. https://get.therecruiteru.com/scale-now