What does it truly take to earn 100k?

Hands up if you were told that you could earn 100k in a year in recruitment… 🙋

I feel like this was the typical hook, line, and sinker many of us were told to entice us into working as recruitment consultants, and for a lot of us it (obviously) worked.

However, earning 100k in a year, especially in today’s economy, isn’t an easy thing to do. 

Newsflash, it’s also (nearly) impossible to do this in your first year as a recruiter. Notice that I say nearly - because I’m sure there are exceptions to the rule. 

However, generally, no one is earning the 100k mark within year one or year two because it can take a pretty long time to build up a client base and also bill consistently.

I’m going to break down for you (as easily as possible) what earning 100k in a year can look like.

Let’s say your basic salary is £35,000, and your maximum commission percentage is 20%. 

You’d need to bill £325,000 in the year to achieve this. 

This isn’t even taking into account a lot of agencies who have desk fees, whilst also assuming that your monthly billings would be eligible for the 20% commission bracket.

You’d need to be billing over £27,000 a month to be on target, which can be very achievable in some markets but also a lot harder in others. 

We're huge fans of reverse engineering our goals, so let's work through this together and figure out how to actually earn £100K in a year…

Work out your average deal value

To work out your average deal value, you need to follow these steps:

1. Determine the total value of all deals:

   • Sum the monetary value of all the deals you have closed in a given period (e.g., a month, quarter, or year).

2. Count the total number of deals:

   • Count the total number of individual deals you have closed in that same period.

3. Calculate the average deal value:

   • Divide the total value of all deals by the total number of deals.

For example, let’s say you’ve billed £250,000 in a year, and you’ve made 15 deals, that works out to be around £16,666 as your average deal value.

Doing this on your annual and quarterly billings enables you to see the months/quarters you’re doing best and where you can improve.

For example, if you want to have an average deal value of £20,000 instead of £16,666, what deals have potentially held you back? Is it a pattern depending on the time of year? Is it not going for high-value work?

Understand how client rates affect your billings and look at your current client roster.

If you really want to hit 100k in earnings, you need to understand how rates affect your billings.

For example, if you consistently work between 15% and 18% with clients, although a 3% difference may not sound like a lot, in practice, it can be the difference between earning significantly more one month and the next.

Let’s say the salary you’re working with is £50,000 

You can start to see how even a 1 or 2% extra in agreed rates can make a huge difference to your billings and earnings.

If you continuously go for ‘low-hanging fruit’ in the 15% - 18% area, it will be hard to maximise your earnings and make a real difference to your billings and take home. 

If you prioritise a client roster that is 18% and above, then you can already start to improve your earnings without winning new business or onboarding more clients. 

Work out how many jobs you need to work on

Now that you have your average deal value, you can start calculating your fee and the typical percentage you work to. 

You can then look at how many jobs you need to fill throughout the year.

You can do this by working out your job-to-fill ratio first. 

Your job to fill ratio is how many jobs you pick up vs how many you fill. Let’s say you’re a perm recruiter and have a 3:1 ratio (so for every 3 you pick up, you fill one in a 1-month period). 

Let’s say you need to fill 24 jobs in a year to reach your targeted billing amount.

That means you’ll have to fill 2 jobs a month, meaning your ratio is 2:1. 

A current ratio of 3:1 indicates you’ve got some work to do.

Who are your best clients?

Who is going to enable you to increase that number?

How can you increase the number of jobs you pick up monthly to increase that ratio and your chance of success?

Then you can figure this out.

The final layer

What are your weekly non-negotiables that should result in the end outcome you're aiming for?

• How many client meetings do you need to book per week to win X number of clients?

• How many interviews do you need to book per week to place X candidates?

• How much BD activity do you need to do each week to land X number of client meetings?

Once you have figured all of this out, you have the science behind making your £100K.

We can’t talk about earning £100k without discussing the importance of understanding your commission rates.

To tie it all together, you now need to know how your commission works to make you a six-figure earner.

The best recruiters know exactly how their commission is structured and you need to if you want to earn £100K.

Did you know…

• Recruiters are paid an average of 17.15% commission during 2023, but the most profitable agencies paid 17.64%, and the fastest growing agencies paid 18.45%.

• 48.42% of recruiters have a threshold; this is higher for the most profitable at 51.22% but much lower for the fastest growing at 44.74%.

• 55.2% plan to change their commission in the year ahead. Of those, 47.46% are changing their structure, and 22.03% are introducing better processes for managing commission.

See the full census from Konquest here.

Let’s give you an example of what you’d earn in commission from billing £25,000 in a month with no threshold.

The 100k mindset

Finally, it’s time to get yourself into the 100k mindset.

Discipline over motivation: Even when you’re smashing your targets and have a great pipeline, don’t get complacent. Keep working hard and meeting your non-negotiables.

NO complacency: It will kill your six-figure year. The best recruiters are dialled in and locked into their goals. They celebrate their wins, but then they keep going the next day. You have to operate in this way to become a six-figure earner.

Marginal gains: You must adopt a continuous improvement mindset and not beat yourself up when your gains are small. 1% is better than 0%! You should always be looking for ways to improve marginally every single day.

Look after yourself and slow down: It doesn’t have to be 12-hour days and running yourself into the ground to achieve success. Understand when you need a break to realign and refocus, prioritise your well-being, and know when to slow down to speed up.

Agility is key: Don't get stuck in your ways, and always be open to thinking about what the best possible ways are to help you achieve your goals.

P.S. Whenever you're ready, there are 3 ways I can help you:

#1: Do you listen to my podcast? I release a weekly episode with either a top-performing recruiter or recruitment entrepreneur to find out how they achieved their success so you can learn directly from their journey Check out my latest episode and subscribe to the show.

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