The fee is visible. The cost of not using a retained firm is not. Here is the full ROI analysis — with real numbers.
The retained executive search fee is typically the first number any cost-conscious company focuses on: $60–75K on a $300K VP role. It is a real number, it is visible, and it appears before any value has been delivered. The costs of not using a retained firm — vacancy duration, failed search probability, wrong-hire risk — are real but invisible at the decision point. This framing asymmetry consistently leads companies to make the wrong cost comparison.
This page runs the full ROI analysis. The numbers are specific and sourced.
| Cost Item | Without Retained (LinkedIn + contingency) | With Retained (Majhi Group) |
|---|---|---|
| Search fee paid | $0 (contingency, no placement) or $60K (if placed) | $65K |
| Timeline | 90–130 days (if successful) | 41 days average |
| Vacancy cost (days saved × $10K/wk equiv.) | Baseline — no saving | 7 weeks saved = ~$230K avoided |
| CEO time covering function (10 weeks at 25%) | $50K (on $1M comp equivalent) | $20K (5 fewer weeks) |
| Search failure probability (30% × replacement cost) | $45K expected failure cost | <$5K (<5% failure rate) |
| 18-month failure risk (40% avg × $200K replacement) | $80K expected replacement cost | ~$20K (90%+ retention) |
| Total expected cost | $175K–$235K | $110K–$130K |
The retained search is the cheaper option by $65–105K in total expected cost on a VP Sales search — despite paying $65K more in fee. The savings come from vacancy duration reduction (the largest single factor), lower failure probability, and higher 18-month retention. The fee is the wrong number to optimise.
At what point does the retained search fee pay for itself? For a VP Sales role, the calculation is straightforward: if the retained search closes 7 weeks faster than the alternative, and the weekly cost of vacancy for a VP Sales with a $2.5M quota is approximately $33K (52 weeks / $1.7M quota impact), the fee is recovered in approximately 2 weeks of avoided vacancy. The payback period on the retained fee — at Majhi Group timeline rates — is measured in days, not months.
The 90-day replacement guarantee compounds the ROI calculation. A placement that fails in month 3 — which happens in approximately 5–10% of executive hires industry-wide — triggers a replacement search at no additional fee under a retained engagement. The same failure on a contingency placement requires a full new search at full fee. The guarantee is not a comfort feature. It is a material financial protection that changes the risk-adjusted cost of the two models.
The ROI case for retained executive search is strongest for: revenue-critical seats (VP Sales, CRO, CFO) where vacancy has a direct revenue impact; high-competition talent markets where passive outreach is required; searches that have already failed once (replacement search cost already incurred); and Series B/C companies running 2–3 concurrent VP searches where search failure in any seat has cascading consequences. The ROI weakens only for very specialised niche roles where no retained firm has the specific network required.
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