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I am working on a college project where I set up a small company and need to hire 50 employees. Quotes I received from recruiting and hiring agencies are a bit too much for our budget. How can we negotiate? Thanks.

closed as primarily opinion-based by The Wandering Dev Manager, JasonJ, IDrinkandIKnowThings, gnat, Chris E Nov 29 '16 at 21:22

Many good questions generate some degree of opinion based on expert experience, but answers to this question will tend to be almost entirely based on opinions, rather than facts, references, or specific expertise. If this question can be reworded to fit the rules in the help center, please edit the question.

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    How is it that a college project involves hiring 50 people? That is a large number of people for a 1,000 person company to hire all at once-- the amount of time and energy to manage that many additional people let alone train them is not trivial. You can, of course, advertise the positions yourself and put in the time and energy to recruit people rather than paying external companies to do that legwork on your behalf. But the entire premise seems very odd. – Justin Cave Nov 29 '16 at 6:13
  • Talk to your project advisor. Ask for some mentoring on the concept of "negotiation". – WorkerDrone Nov 29 '16 at 13:47
  • Is it a college project, and by that, I assume that it's a paper exercise, and not the creation of a real 50 employee company? If that's so, then you shouldn't be calling real agencies for quotes and negotiation; you'll be wasting their time. If it's a real company, it's unlikely that you'll need 50 trained professionals immediately - employ who you need, when you need them, based on your cashflow. – PeteCon Nov 29 '16 at 14:23
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    I'm voting to close this question as off-topic because its about running a business not navigating the workplace as described in the help center – IDrinkandIKnowThings Nov 29 '16 at 19:23
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As you mentioned, this is a college project and not a real-life example. This means every single element should be challenged.

  • You do not have the budget. This part is straightforward. You can ask the agency if they can lower their price, the answer will most likely be no.

  • The agency is asking too much. As this is a college simulation in my understanding, there is a good chance that asking "can we change agencies?" will be met with "you can find the same service 5-10% lower with Agency XYZ".

  • We need to recruit 50 employees. Does it have to be 50 ? Wouldn't 45 or even 40 do the trick ? You only specified in the question that you need 50, but this should be challenged. In addition to that, 50 induces a threshold effect in several countries, so going from 49 to 50 employees can be extremely costly.

  • We need to recruit 50 employees. Do you need employees, or can you add some interns in the mix ? Their cost will be cheaper, but they can still realise most tasks.

Your entire project probably has more things which should be challenged, this answer only answered the elements you identified.

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I think you are vastly underestimating the value that hiring through an agency can give to your organization. They charge high fees because a lot of prospective placements actually fall through the cracks. The recruiters' time isn't free, nor the account managers', nor the fancy office you expect to go visit them in, or the time of the custodian who cleans them. Agencies have expenditures for phone, internet, advertising, and everything else you'd find in a service business.

Again, given that many like yourself will have an agency running like a chicken with its head cut off to fill a position, and THEN decide later that you don't really need the position filled -- how do you expect the agencies to stay afloat if you're trying to be cheap? There's a point where they can't negotiate AND stay in business.

If cheap is your motivation, try Craigslist. But you'll get what you pay for.

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How can we negotiate? Thanks.

First, you google for the word "negotiation" and you educate yourself as to what "negotiation" is and how the negotiation process works. Seriously.

Second, you say that you want to negotiate. WHAT do you have to offer? A negotiation is a trade. If you have nothing to offer, then you have nothing to trade. And if you have nothing to trade, then you have nothing to negotiate with. If you have nothing to negotiate with, then you are wasting everyone's time.

Recruiters usually ask for two months of an employee's salary. It's clear that you can't afford to pay two months of an employee's salary let alone 12 months of an employee's salary. Let's assume that you somehow managed to get the recruiters to work for free, how do you intend to pay your 50 employees? It doesn't look like you have thought things through.

  • The second paragraph is a bit bizarre. In a negotiation over the price of services, of course you have something to offer: your business. The negotiation is over what level of payment makes it worth their while to work with you. You seem to be implying it's pointless to negotiate, but I don't see any rationale for that. 50 hires is quite a large volume of business and it's quite reasonable to expect the normal per-employee rate may go down because of that. – user45590 Nov 29 '16 at 13:51
  • @dan1111 - The OP cannot afford to pay two months' of ONE employee's salary, which is the usual US fee for a successful recruitment exercise. You want to negotiate with WHAT available money again? You're making an "Alice in Wonderland" argument. – Vietnhi Phuvan Nov 29 '16 at 13:56
  • The only information I see the OP gave is that the quotes were "a bit too much". Where do you see them saying that they can't cover the recruitment fee for a single employee? – user45590 Nov 29 '16 at 13:59
  • @dan1111 - Take a hint: it's a college project. I am not even sure that the OP and his people can pay for anything with real money. – Vietnhi Phuvan Nov 29 '16 at 14:05
  • Admittedly the question is not really clear of what the scenario is. But the assumption that they want to really hire a recruiter, yet have no real money, does not seem like the most likely scenario to me. – user45590 Nov 29 '16 at 14:10

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