• Traditional Percentage-Based Model:

  • Based on percentage of candidate’s salary
  • Benefits: Naturally accounts for salary inflation over time
  • Key Issue: Small percentage drops (e.g. 20% to 15%) actually represent large revenue losses (25% fee reduction)

• Good-Better-Best Pricing Framework:

  • Three-tiered service offering with increasing value and price at each level
  • Shifts conversation from price negotiation to value proposition
  • Allows clients to self-select service level based on needs
  • Should present all three options to establish price anchoring
  • Industry-specific benefits can be built into each tier (e.g. payment terms for construction)

• Value Communication Strategy:

  • Avoid technical terms like “contingent” and “retained” with clients
  • Focus on communicating specific value relevant to client’s pain points
  • Break down recruitment process into 7 stages with multiple components
  • Demonstrate differentiation through detailed service delivery approach

• Pricing Psychology Principles:

  • Anchor pricing: Using premium tier to set price expectations
  • Choice architecture: Giving options rather than single price point
  • Value-based pricing: Aligning fees with perceived value delivery
  • Avoiding percentage-based mental traps in negotiations

• Modern Pricing Best Practices:

  • Move away from salary-based fee increments
  • Build in upfront payment components (like other B2B services)
  • Focus on niche expertise to justify premium pricing
  • Maintain pricing discipline rather than matching competitors
  • Package services based on specific client segment needs

• Value Recognition Framework:

  • Understanding and articulating existing value proposition
  • Breaking down recruitment process into concrete deliverables
  • Demonstrating expertise through market specialization
  • Connecting pricing to actual value delivered rather than industry norms

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