A preferred supplier agreement is an opportunity to provide a cost effective solution to your recruitment that will improve the effectiveness of your recruitment process. It should be an agreement that is beneficial to both parties, allowing performance to be measured through key performance indicators in line with corporate objectives. A preferred supplier agreement should;

Save you money
Improve candidate matching
Improve time to hire
Improve employer brand perception
Allow you more time to work towards wider HR goals

In most cases preferred supplier agreements are normally introduced through a competitive bid process and once this is agreed processes are put in place to ensure that employees of the organisation use the services of the selected suppliers.

My client HR partners often share frustrations of recruitment companies ignoring preferred supplier agreements and finding ways to gain access to vacant job via other operational routes. So how can recruitment businesses do this?

They can do this because a good CV will always be considered
They can do this if there are not tight enough processes in place
They can do this if a preferred supplier agreement is not adhered to (Learn how to overcome these three challenges in our next blog!)

Implementing a preferred supplier agreement can be a conflicting issue. It needs to be carefully considered and accepted by the business not just the recruitment function. Its needs a recruitment team that will explain the process and the practicalities to all involved and continuously champion and protect the agreement.

Most employers state that they have a preferred supplier agreement in place but in many cases it is just said as a deterrent to recruitment sales calls. In truth agencies are often engaged on an ad hoc basis with different agency rates individually negotiated and agreed.

This can be a confusing message to all involved. Our advice before considering or reviewing your preferred supplier agreement is to establish ‘what a preferred supplier agreement means to you’, set your goals, agree your parameters and stick to the agreement. Make your suppliers work for you.

Stroud Resourcing is an advocate of working as part of a ‘preferred supplier agreement’. We believe that it allows us to gain a better understanding of our clients business which in turn delivers exceptional results. We take pride in being brand ambassadors!