Contingency vs. Retained Recruiting for Hospitality

When a hotel, resort, club or restaurant group decides to use a recruiter, the first real decision is the fee model. Contingency and retained recruiting can produce the same hire, but they work differently, cost differently and suit different roles. Here's how to choose.

The short version

Contingency recruiting: you pay only when you hire the recruiter's candidate. Retained recruiting: you pay a firm in installments to run an exclusive search, whether or not you hire from it. A third option, engaged search, sits in between, with a smaller upfront payment and the rest due on hire.

Contingency vs. retained recruiting at a glance

	Contingency	Retained	Engaged
Typical fee	20% to 30% of first-year pay	30% to 35% of first-year pay	25% to 33% of first-year pay
When you pay	Only when you hire	In installments, usually thirds, whether or not you hire	Part upfront, the rest on hire
Exclusivity	Usually non-exclusive	Exclusive	Exclusive or close to it
Typical guarantee	30 to 90 days	6 to 12 months	Varies by firm
Best fit	Managers and department heads	C-suite, board and corporate VP roles	Senior directors and VPs

These ranges come from recruiting firms' own published benchmarks, so treat them as typical rather than fixed. Fees are negotiable, and many firms offer volume pricing for multi-property groups. GoFractional, for example, cites contingency fees of 15% to 30% and retained fees of 25% to 35%.

When contingency recruiting is the better fit

Contingency works best when the role is well defined, the candidate pool exists, and you need to move quickly. In hospitality, that covers most of the leadership layer that actually runs properties:

Restaurant general managers, AGMs, kitchen managers and executive chefs
Hotel department heads: front office, housekeeping, rooms division, F&B
Hotel assistant general managers and many hotel GMs
Private club department heads and clubhouse managers
Repeat hiring across a portfolio, where one recruiter learns your standards

The main advantage is risk. If the recruiter doesn't deliver, you owe nothing. The trade-off is that a contingency recruiter juggles several searches at once, so pick a firm that specializes in your kind of role and ask how many searches each recruiter carries.

When retained search makes sense

C-suite and corporate roles: CEO, COO, CFO or regional VP of operations
Board-led club searches: many private clubs hire their GM or COO through a retained firm and a search committee
Highly sensitive searches where the process needs a dedicated team and strict confidentiality
Very thin markets, where only a handful of qualified people exist nationally

You pay for commitment: a dedicated team, an exclusive process and a longer guarantee. You also pay even if you don't hire, so retained search only makes sense when the role justifies it.

Questions to ask any recruiting firm

What's the fee, how is it calculated, and is it based on base salary or total compensation?
What happens if the hire leaves early, and for how long?
Who will actually work my search, and how many other searches do they carry?
How do you find candidates: job postings, a database or direct outreach to employed managers?
How do you keep a replacement search confidential?
Which roles don't you recruit for?

How we work

We're a contingency firm that specializes in hospitality managers: department heads and unit leaders for resorts, hotels, private clubs and full-service restaurant groups. You pay nothing until you hire, our fee is 18% of first-year base salary, every placement carries a six-month replacement guarantee, and groups hiring three or more managers a year get portfolio pricing. We also run confidential replacement searches on the same terms.

We don't run corporate C-suite or regional VP searches. For those, a retained firm is the right call, and we'll tell you so.