Contract-to-hire for a fractional SDR

Some buyers use a fractional or contract SDR as a trial run for a permanent hire. It lets you see how a person performs before you commit. It only works if the conversion terms are agreed before the work starts.

How it usually works

You engage the rep through a staffing firm or an agency. If you later want to hire them directly, the firm may charge a conversion fee, sometimes called a buyout or placement fee. Staffing-industry sources describe the fee as compensation for sourcing and placing the worker.

What the fee looks like

These are general staffing figures, not SDR-specific, and the sources are staffing-industry sites:

• A sales-focused source gives conversion fees of about 12% to 18%.
• Fees often step down with time on assignment, sometimes reaching zero after a set number of hours or months.
• One analysis says contract-to-hire costs less than a direct hire only up to a break-even point, which it puts at six to 14 months depending on the fee and markup.

Fractional SDR providers may set their own terms, and no figure specific to them is published. Ask for the schedule in writing.

What to negotiate before you start

• Whether conversion is allowed at all. Some contracts forbid hiring the rep.
• The fee and how it declines. Ask for a date or hours worked after which it is zero.
• Notice and the rep's consent. The rep decides too.
• Who owns the lists and sequences when the rep moves to your payroll. See contract terms.

When converting makes sense

• The rep reliably books meetings your team accepts, and you have enough pipeline work for full-time hours.
• You can now manage an SDR. A full-time rep brings salary, benefits, tools and a manager's time. The full-time cost breakdown lists the lines.

When a fractional rep still fits better, compare fractional with full-time.

Back to hiring a fractional SDR, or see the fractional SDR providers we list.

FAQ

Can I hire the fractional SDR directly?

Sometimes. It depends on the provider's contract. Ask before you sign, and get any fee in writing.

How long should the trial be?

Long enough to judge held and accepted meetings, not just booked ones. Agree the length and the conversion terms in writing before the rep starts.

Is contract-to-hire cheaper?

Only up to a point. After the break-even, a direct hire is cheaper, according to one staffing analysis.