The standard practice in the executive search industry is to charge a
percentage of the new executive´s first-year compensation. For retained firms, the usual range is 33 percent to 35 percent. For contingency firms, the usual range is 20 percent to 25 percent or higher. The range may be higher for international searches.

Some firms are willing to negotiate lower fees in exchange for a guaranteed volume of assignments. For the most senior
positions with the highest salaries, an increasingly common approach is to charge a fixed fee for a given assignment. And in the world of start-ups, recruiters may even accept stock in lieu of some portion of the cash fee. Be sure to get agreement up front on how expenses will be handled. Most firms bill for expenses incurred while working on an assignment, and the costs can vary widely.

If a search fails -- you aren´t happy with the candidates presented or no one is found who will accept the job in question -- you are still legally obligated to pay a retained firm their full fee. In this case, a contingency firm is not paid. While contingency firms won´t bill you until a search is completed, the billing policies of retained firms are more varied. The standard practice is to bill one-third when the search is initiated, one-third after a month, and the balance at the start of the third month.