What executive search and headhunters cost in the UK
Retained executive search in the UK runs 25 to 33 per cent of first-year salary, billed in thirds, plus VAT. Contingency runs 15 to 25 per cent and is paid only on a placement. Most firms will not put those numbers on a page, which is the only reason this one does.
What a headhunter charges for a senior hire
The fee on each salary below is the market band worked through: 25% and 33% of a first-year base, before VAT and before any bonus is added to the basis. A headhunter and an executive search firm charge on the same model; the words differ more than the invoices do.
| First-year salary | Fee at 25% | Fee at 33% | Or, days of a fractional executive |
|---|---|---|---|
| £80,000 | £20,000 | £26,400 | 17 to 23 days |
| £100,000 | £25,000 | £33,000 | 22 to 29 days |
| £120,000 | £30,000 | £39,600 | 26 to 34 days |
| £150,000 | £37,500 | £49,500 | 33 to 43 days |
| £200,000 | £50,000 | £66,000 | 43 to 57 days |
The last column is the same money bought as days of a fractional CFO at the middle of the published UK band of £800 to £1,500, so £1,150 a day. It is there because it is the comparison a founder actually makes, and because it argues against a search as often as for one.
What the fee actually buys
A search fee is not a finder’s fee. What you are paying for, when it is done properly, is a scope written down before anyone is approached, a map of the real market for that scope, direct approach to people who are not looking, assessment against the written standard rather than against a feeling, reference work that goes past the two names offered, and somebody managing the close so an accepted offer does not fall apart.
The parts that get skipped when a fee is cut are the map and the reference work, and both are invisible until the appointment fails. That is the argument for asking what the process is rather than what the percentage is.
Retained vs contingency fees
Retained search is paid in instalments whether or not anybody is appointed, and buys an exclusive process: the map, the approach and the reference work. Contingency is paid only on a placement, at 15 to 25 per cent, and buys speed at the visible end of the market. The full comparison, with when each one is the right purchase, is in retained against contingency search.
Contingency agencies below the executive level price the same way at a lower percentage, and the details that move the bill, the basis, the rebate period and exclusivity, are set out in what recruitment agencies charge.
Paid to run the search whether or not you hire, usually in three instalments. Exclusive, and the firm carries the mandate rather than the outcome alone.
Suits a seat that is hard to fill, senior, confidential, or where one wrong hire is expensive.
Paid only on a placement. The firm is usually working several similar roles and will move fastest where it is most likely to be paid.
Suits a visible market where speed matters more than depth, and where several firms competing is an advantage rather than a mess.
£2,500 to begin the search, then 15% if you appoint, minimum £3,500, within 12 months of an introduction. A different product rather than a cheaper version of the same one.
Executive search fees in the US
In the United States the same work is priced higher: 30 to 35 per cent for retained search and 20 to 25 per cent for contingency. The gap is not a quality difference. It reflects a market where search is older and more established, and where more of the fee is expected to cover a genuinely exclusive process.
At-will employment also changes the timeline: with no notice period to serve, a US executive can often start within two to four weeks of accepting, so the search itself is most of the wait. The US route is set out on retained search in the US, and choosing an executive search firm in the US covers what differs in practice.
The details that cost the most to leave unagreed
- The basis. Base salary, base plus bonus, or base plus bonus plus equity. The same percentage on the third basis can be tens of thousands more.
- VAT. Quoted inclusive or exclusive, and it is a fifth of the number.
- The guarantee. How long, what it covers, and crucially what voids it.
- Off-limits. Whether the firm is barred from approaching the people it places for you, and for how long.
- What happens if you do not hire. On retained, the instalments already paid are usually not returned. Know that before the first one.
Common questions
What is a typical executive search fee in the UK?
25 to 33 per cent of first-year salary for a retained search, billed in thirds, plus VAT. Contingency, where you pay only on a placement, runs 15 to 25 per cent. On a £150,000 seat the retained fee is £37,500 to £49,500.
What is the difference between retained and contingency search?
Retained means the firm is paid to run the search whether or not you hire, usually in three instalments, and works the mandate exclusively. Contingency means the firm is paid only on a placement and is usually working several similar roles at once. Retained buys attention and a defined process; contingency buys optionality and speed at the visible end of the market.
Is a search fee charged on base salary or total package?
It varies, and it is the single most expensive detail to leave unagreed. Base only, base plus bonus, and base plus bonus plus the value of an equity grant can differ by tens of thousands on the same appointment. Settle it in writing before the search starts.
What does an executive search guarantee usually cover?
Commonly a free replacement search if the appointment ends within a defined period, often three to six months, and commonly voided if the company makes the person redundant or changes the role. Read what voids it rather than what it promises.
Who pays the headhunter's fee?
The hiring company. In the UK an employment agency may not charge a candidate for finding them work, under the Conduct of Employment Agencies and Employment Businesses Regulations 2003, so a headhunter approaching somebody for a senior role is paid entirely by the company that engaged it. A candidate asked for a fee to be put forward is not dealing with a search firm.
Sometimes the answer is not a search at all
If the seat is part-time, or you are not yet certain it is permanent, a search is an expensive way to find out. Operator Search answers the same brief fractionally in five business days, and retained search is there when the seat is genuinely full-time. The calculator does the arithmetic on both, and the fee worked through on a £150,000 CFO shows every line of year one.