A mid-size technology company recently came to us after a contingency search for their VP of Engineering went sideways.

Three agencies had been working the mandate simultaneously for six weeks. Each had presented candidates. None of the candidates were right. Two of them had already been approached directly by the client's internal team months earlier. The hiring manager had spent 20 hours in interviews and had nothing to show for it.

The problem was not the agencies. The problem was the model.

Understanding the difference between retained and contingency recruitment, and when each is appropriate, is one of the most important decisions you can make before starting a senior or leadership hire.

How Each Model Works

Contingency recruitment is paid on success. The agency earns its fee only when you hire one of their candidates. There is no upfront commitment, no exclusivity, and no dedicated resource. You can engage multiple contingency firms simultaneously, and the first one to place a candidate gets paid.

Retained recruitment is paid in installments, beginning at engagement. The firm is paid to start the search, typically one-third of the fee upfront, and commits exclusively to your mandate. They are not competing with other agencies. They are accountable for the outcome, not just the speed.

Both models are legitimate. They are designed for different problems.

The Incentive Problem in Contingency Search

The contingency model creates a structural conflict between what is fast and what is right.

A contingency recruiter who is competing against two other agencies has one priority: present a candidate before anyone else does. That incentive pushes them toward candidates who are immediately available, visible in market, and easy to screen quickly. It pushes them away from the thorough network-based search that uncovers the best passive candidates, leaders who are not looking, not posting, and not responding to InMails.

It also means your mandate is competing for attention with every other mandate the agency is working. You are not a client. You are a potential commission.

When Contingency Makes Sense

Contingency recruitment works well for roles where: the candidate pool is wide and active, the role is not at leadership level, speed is the primary variable, and the hiring criteria are straightforward to screen.

For high-volume roles, junior-to-mid-level hiring, and roles where strong candidates are actively in market, contingency is cost-effective and efficient. Many organizations use both models, contingency for volume hiring, retained for leadership.

When Retained Search Is the Right Call

Retained search is the standard for leadership recruitment, and for any role where: the ideal candidate is almost certainly not actively looking, confidentiality is required, the search requires deep market knowledge or specialist network access, or a wrong hire would have significant organizational consequences.

At the senior leadership level, the best candidates are rarely in active job search. They are performing in their current roles, not monitoring job boards. Reaching them requires a credible approach from a firm they will take seriously, in a channel that respects the confidentiality of the conversation.

A contingency firm competing against others cannot make that approach effectively. A retained firm, working exclusively and with a financial incentive to do the search properly, can.

What Exclusivity Actually Means

When you retain a firm exclusively, you are not just paying for access to their network. You are buying the conditions under which a proper search is possible.

Exclusive engagement means the firm can approach passive candidates confidentially on your behalf, without the candidate wondering why three different agencies are calling them about the same role. It means the firm can invest real hours, 200+ in a well-run search, knowing those hours will be applied to your mandate, not split across ten competing mandates with uncertain outcomes.

Exclusivity is not a concession to the firm. It is a prerequisite for the process to work.

The Red Flags to Watch For

In a retained engagement, the firm should be able to articulate clearly: how many searches they are running simultaneously, what the dedicated resource on your search will be, what the process looks like from kickoff to shortlist, and what happens if the placed candidate does not work out.

If a firm pitching a retained engagement cannot answer those questions specifically, they are selling a retainer without delivering the process that justifies it.

In a contingency engagement, the red flag is an agency promising to run a "thorough" or "exhaustive" search. A contingency structure does not support that. If you want thoroughness, you need a model that pays for it.

What South End Partners Does

South End Partners works exclusively on a retained and exclusive basis. We do not compete against other agencies on the same mandate. We do not run contingency searches.

The process we run, role scoping, network-based candidate identification, behavioural and cognitive assessment, detailed shortlist reporting, requires a level of resource commitment that is not compatible with the contingency model.

We are direct about this in the first conversation. If a retained model is not the right fit for your mandate, we will tell you rather than try to fit every search into one structure.

The Bottom Line

For most senior leadership hires, the question is not whether to use retained or contingency search. The question is whether the fee structure of the firm you are evaluating actually supports the process they are describing.

A thorough, network-based, assessment-led search requires dedicated resources and exclusive commitment. If the firm is not being paid to provide those things, they are not providing them, regardless of what the proposal says.

South End Partners is a retained executive search firm based in Toronto. We work with organizations across North America across technology, life sciences, CPG, finance, manufacturing, supply chain, and operations.

To discuss a search, reach out to our team today!