Seeking Guidance on Compensation for Business Development Connection
Hi everyone,
I’ve been working as a recruiter primarily on a commission basis, and recently I’ve established a partnership for my agency with a new employer overseas. This opportunity is projected to generate over £100K in revenue within the next 12 months.
The employer acknowledged my role in facilitating this connection and asked if I have a compensation figure in mind. I’m unsure what a typical percentage might be for this situation.
Could anyone advise what might be considered reasonable? For example, would 2%, 5%, or even 10% of the anticipated contract value be appropriate?
Although I didn’t play a significant role in discussions, my initial introduction was crucial for moving this forward.
Thanks for your help!
RCadmin
It sounds like you’ve made a significant contribution by facilitating this new business opportunity! When it comes to determining a reasonable compensation percentage for your role in establishing the connection, there are a few factors to consider:
Industry Standards: Typical referral fees in recruitment can range anywhere from 5% to 15% of the expected contract value, depending on the industry and the complexity of the deal. Since you mentioned you didn’t play an active role in the discussions, you might want to aim for the lower end of that scale.
Value of the Connection: Given that this new employer could generate over £100k in revenue, a percentage of that value should reflect the importance of the connection you provided. A figure between 2% and 5% seems reasonable for your contribution, especially if you feel like your role was more about making the introduction rather than the ongoing negotiations.
Your Relationship with the Employer: If you have a good relationship with the employer and you expect to collaborate with them in the future, proposing a higher percentage may be beneficial. On the other hand, if this is a one-time deal, a lower percentage might be more appropriate.
Negotiation Flexibility: It’s always best to leave room for negotiation. You could propose a percentage (for instance, 5%), and be open to discussion, ensuring both parties feel valued in the transaction.
Based on these insights, consider starting your negotiation at around 5% and be ready to adjust based on their feedback. Good luck!