I was hired to recruit a CEO for $6MM steel supply company, and accomplished the task in a record-breaking 27 days. (A typical executive search at this level takes three to six months.) I saved the client company $25,250 in recruiting fees by charging hourly rates instead of a project fee, and provided this solution with one phone call from my Rolodex®. (Today, we would say "my LinkedIn network.") The first candidate I identified for the job turned out to be a perfect fit. I did not trust the owner of the company, so felt I needed a well-written agreement to keep me in control of the assignment. Notice the payment in advance clause. Here is the proposal that secured the business.
June 17, 20—
Nathan Black
President
Steel Warehousing Company
5000 West Lafayette Street
Detroit, MI 48226
Dear Nathan,
You have asked our firm to help you select an interim executive to operate Steel Warehousing Company, to position the company for sale, and to sell it in the shortest time practical. We are very excited about the project, and are confident we'll complete it successfully.
We will undertake your project as a consulting assignment by the hour, not as a standard retained search at 25-33% of annual salary. This will afford you substantial savings, and will allow you to discontinue our work together if you sell the company yourself or find your own interim CEO, or otherwise change your plans.
We will conduct this consulting assignment and executive search under the following terms and conditions:
- You will pay for consulting time by CareerLab consultants at $250 per hour.
- You may terminate our services at any time with 24 hours' notice, and your only obligation will be to pay all current invoices and accumulated charges. Likewise, we may terminate the project with you at any time with 24 hours' notice.
- You will pay all out-of-pocket costs, including but not limited to, travel expenses (if any), mileage, long distance telephone, courier and mailing expenses, and copy charges. You authorize us to advance funds for the payment of these costs and agree to reimburse them as part of your monthly billing.
- You understand that we require that you pay our fees in advance. We call these advance fees a retainer. We bill monthly against the retainer. You agree to maintain a retainer balance of $2500 at all times during the project. You agree to keep all monthly bills currently paid, thereby maintaining the retainer balance.
- You acknowledge that should you fail for any reason to make the payments as you have promised, pay current bills, and maintain the required retainer balance, such failure will cause our firm to withdraw from your case.
- If, for some reason, you owe us money and do not pay it as agreed, you hereby agree to pay all costs of collection incurred by us, including collection agency fees, court costs, and reasonable attorneys' fees.
- You acknowledge by signing below that you agree to abide by the fee arrangement set forth in this letter.
I have read the above Fee Agreement. I understand it and agree to its terms.
By: ________________________________
Nathan Black
President
Steel Warehousing Company
Date: _______________________________
By: _________________________________
William S. Frank, President, CareerLab