Differences Between Contingency and Retained Search

Contingency and Retained Search

There are two traditional types of executive search firms in the recruiting industry: contingency and retained. If you have an important executive to hire, you will have to decide what kind of search firm to use. In leadership talent acquisition, the contingency and retained search firm models could not be more different. They approach search differently.

The primary difference between contingency and retained search is when and why the executive search firm is paid. In contingency search, a search firm is only paid if the client company hires a candidate the firm presents. In retained search, a search firm is paid to do the work of finding and recruiting candidates. Retained search firms are paid regardless of who the client company hires or when they hire a candidate. 

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Different Search Types

Contingency firms focus primarily on active candidates, while retained search firms focus on passive candidates who are not actively seeking their next job opportunity. While there is some overlap at the VP level, contingency and retained firms focus on different levels. Retained search firms focus on senior-level executive roles, while contingency firms focus on more staffing-level positions.

Different Pricing Models

Moreover, the pricing models are quite different. Contingency firms do not charge for the work that they do; they only get paid for actual placements. Retained search firms charge a retainer to do the work of executive recruiting, regardless of the outcome. Clearly, retained search, which is a form of management consulting, is a premium service, while contingency firms appeal to the budget-minded. For more on retained search fees, check out our Guide to Executive Search Pricing.

To be clear, whether you use retained or contingency search services, you will likely pay tens of thousands of dollars to find the executive you need. So the question becomes, is it worth the price? We’ve listed the differences below to help you understand the value of each model.

Smarter Retained Search

The Good Search falls within the retained executive search firm category. However, we are positioned as a next-generation alternative to traditional retained executive search. We are a national executive recruiting practice headquartered in the Greater New York City Area. We specialize in technology. The Good Search conducts retained executive searches for leaders in software engineering, data science and analytics, artificial intelligence (AI) and Machine Learning (ML), the Internet of Things (IoT), Cloud, and Information Technology (IT).

For employers that would rather not go “out to search”, our research practice Intellerati offers month-at-a-time support for internal executive recruiting and talent acquisition teams.

This Way That Way sign metaphor for contingency and retained executive search

Search Firm Selection

In order to select the right executive search firm, it is important to understand the inherent strengths and weaknesses of traditional contingency and retained executive search firm models. Those shortcomings make an argument for a more evolved executive search firm model. With that caveat, what follows are the general differences between the contingency and retained search firm models:

Search Firm Type

Traditional Retained Firms

Traditional Contingency Firms

Types of Positions

Middle-level executive and individual contributor roles.




Conducts search assignments often on a non-exclusive basis. Only paid for candidate placement. In other words, successful searches are never free.

The Relationship

Recruiting process is transactional and placement-oriented.

Rarely conducts original research. Presents active candidates rapidly in race against other firms, often without thorough appraisal.

With no guarantee of payment for services performed and no budget for research, contingency firms may abandon difficult searches and leave positions unfilled.