Does the recruitment industry value its service?

Written by: John McCluskey MD, Whizdom APSCo Director

It’s frustrating in our industry to see that the biggest threat sometimes seems to be ourselves. Many recruiters and consultants are undervaluing themselves and our industry if the main way to win business is by cutting fees.

This really undermines our value and demonstrates to clients and job seekers that we are happy to have a race to the bottom. Lower fees translate to lower service and limits opportunity to add value to job seekers and clients and moves our role more and more to transactional.

We should take lessons from other industries where consumers will pay a premium for service and stand by good brands. The fashion industry is a classic where for a similar item consumers will pay more than double for a brand than for a no name brand. As to in the food industry where stable favourites like Coco Pops (do like my coco pops) far outsell the no name brands and charge a premium. Premium brands do not try to match on price and have brand and quality loyalty.

Price is a factor for some in all industries but when price and not quality is the main driver to influence a product or service it does not drive loyalty, lowers quality and those consumers will move every time there is a better deal. Once prices are lowered it is very hard to increase no matter the circumstances.

I don’t believe it’s a sustainable business model to undercut of pricing, reduce quality and service at the expense of your brand unless you don’t value that.

We should be strong advocates of our industry and the value we add to both candidates and clients. Margins in Australia are already lower than the average in other western markets and the cost of compliance is constantly increasing in an over regulated industry. The simple message here is to value your profession and brand, compete on service rather than lowest price.