COMPARISON | RPO Vs RECRUITMENT AGENCY
WHICH MODEL SHOULD YOU CHOOSE?
Both recruitment models get people hired, but they do it in completely different ways, at different price points, with different levels of control.
A recruitment agency finds you candidates for a role and charges a fee when one starts. Recruitment process outsourcing (RPO) runs your hiring for you, as part of your business, across many roles, for a fee you can budget. Agencies are a purchase. RPO is a partnership.
If you hire a handful of specialist roles a year, an agency is probably right. If you are hiring at volume (full RPO is typically around 80 to 100 hires a year and above), or your hiring has become unpredictable, expensive or hard to govern, RPO usually is. In between, a fixed-time Project RPO or Embedded Talent often fits better than either.
We run both. Vermelo delivers RPO; our sister brand Gerrard White Consulting is the specialist agency. So we will tell you which one you need, even when the answer is not us.
What is a recruitment agency?
An agency works on a role-by-role basis. You brief them, they search their network and the market, they send you a shortlist, you interview and hire, and you pay a percentage of the starting salary when the person begins. Several agencies can work the same role at once. The agency's process, brand and candidate relationships stay with the agency.
Best for: senior, niche or hard-to-find roles; occasional hiring; roles where market knowledge and headhunting matter more than process.
What is recruitment process outsourcing (RPO)?
RPO means an external partner takes on some or all of your recruitment process and runs it as an extension of your team, under your brand. At Vermelo that covers sourcing, screening, assessment, offer management, onboarding and pre-employment checks, with reporting back to you. It is priced as a management fee, a cost per hire, or a blend, shaped around your volumes.
Best for: businesses hiring at volume or at pace; organisations with an agency bill that has stopped being predictable; regulated firms that need a consistent, auditable process across every hire.
RPO vs agency: side by side
How the two models compare on the things that decide it: brand, process, cost, speed, data, compliance and commitment.
Recruitment agency compared with recruitment process outsourcing (RPO)
| Criteria | Recruitment agency | Recruitment Process Outsourcing (RPO) |
|---|---|---|
| How it works | Role by role. You brief, they shortlist, you pay on start | End-to-end or modular hiring run by a dedicated team inside your business |
| Whose brand candidates see | The agency's | Yours |
| Who runs the process | The agency runs its own | Vermelo. Designed with you, delivered by us, measured against agreed KPIs and SLAs |
| Pricing | Percentage of salary per placement | Management fee, cost per hire, or a blend; forecastable |
| Cost at volume | Rises with every hire | Falls per hire as volume rises |
| Speed | Fast for a single role if the agency has the network | Fast at scale once the programme is live; set-up takes longer than one agency brief |
| Data and reporting | Rarely beyond the role in hand | Pipeline, time to hire, cost, quality, diversity and compliance reporting as standard |
| Compliance | Agency's responsibility for its own checks | Consistent screening, supplier management, right to work, and where relevant FCA checks across every hire |
| Commitment | None beyond the role | A contract, usually with volume flexibility built in |
| Where it falls down | Volume hiring; consistency; cost control | Below around 80 hires a year (Project RPO or Embedded Talent fit better); one-off headhunts (specialist agencies fit best); businesses not ready to hand over delivery |
The five questions that decide which model suits your needs best
How many roles are you hiring this year? A handful of specialist roles suits an agency. Around 80 to 100 a year and above is full RPO territory. In between, a fixed-time Project RPO or Embedded Talent usually beats both. Our free Recruitment Capacity Check will show you where you sit.
Can you forecast your agency spend? If the answer is "not really", that unpredictability is the cost full or project RPO (or embedded) removes.
Do candidates see one process or five? Multiple agencies mean multiple experiences of your brand. RPO gives you one.
Are you regulated? If every hire needs FCA screening, right-to-work checks and an audit trail, a single consistent process is a risk decision, not just a hiring one.
Do you want a supplier or a team? Agencies are suppliers. RPO sits in your world: your meetings, your culture, your systems, your bad weeks as well as your good ones.
Can you use both agency and RPO?
Yes, and many of our clients do. RPO for the volume and the process; a specialist agency for the two or three roles a year that need a headhunt. The point is to choose deliberately rather than by default.
An illustrative scenario*
A personal lines insurer opening a new claims operation needs 60 claims handlers, 8 team leaders and a handful of specialist roles inside six months. Using agencies, each of those hires attracts a separate fee (usually a % of the salary) and a separate process, and the specialist roles compete with the volume roles for the same hiring managers' time. Under RPO, the volume campaign, the assessment centre design, the onboarding and the FCA screening run as one programme. If required, a handful of specialist roles can still go to a search partner if the RPO provider is unable . That blend is usually the right answer.
*this is for illustrative purposes only and not a real case study
Not sure which you need?
Try the Talent Solution Finder, or book a discovery call. If the honest answer is "you need an agency", we can introduce you to Gerrard White Consulting.
Go deeper on each comparison: Embedded Talent vs contract recruiter vs agency and RPO vs Embedded vs MSP
What are agencies actually costing you?
Most people know their agency fee percentage. Fewer know what it adds up to over a year of hiring, or what a modest reduction would be worth. Put your numbers in our agency fee calculator to see what agencies are costing you.
Note - Our calculator shows agency spend only. It does not estimate RPO cost, because that all depends on your volumes, roles and how much of the process you want us to run.
Frequently asked questions
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An agency finds candidates for individual roles and charges a fee per placement. RPO takes on your recruitment process, or part of it, and runs it as an extension of your team under your brand, for a fee you can forecast.
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At volume, usually yes, because agency fees rise with every hire while RPO cost per hire falls as volume grows. For a small number of specialist roles, an agency is often cheaper. We model it against your current spend on a discovery call.
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There is no fixed number, but once you are hiring roughly 15 to 20 roles a year, or your hiring comes in unpredictable spikes, RPO starts to make financial and operational sense.
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Yes. Many organisations run RPO for volume and process, and use a specialist agency for occasional senior or niche searches.
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Yes. A single, consistent process makes FCA pre-employment screening, right-to-work checks and audit trails easier to manage than a spread of agencies each running their own checks.
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Briefing an agency takes a day. Standing up an RPO programme properly takes longer, because it involves process design, systems access and team onboarding. Modular or project RPO can start faster than a full programme.