Applicant Tracking System Software (ATS)

An applicant tracking system (ATS)  is software that helps recruiters and hiring managers to attract and hire the best talent.

Applicant tracking systems enable businesses to advertise their jobs, filter applicants, and assess and organize candidates.

Automating administrative duties and helping to sift through hundreds of resumes is one table stakes for a modern ATS. The best applicant tracking tools help businesses attract more of the right candidates (and less of the wrong ones) through modern recruitment marketing.

Applicant tracking system prices range from free (for the most basic tools), to millions of dollars per year for large companies with hundreds of thousands of employees.

It’s hard to be precise but, depending on the size of your business, we can give some ranges – you can find cheaper or more expensive solutions depending on your needs.

Micro Businesses

If you have a very small business, you’re not planning to make lots of hires, and are cost-sensitive, it’s worth at least considering an ATS that charges per vacancy as this is likely to be the most cost effective option.

You can expect to pay anywhere from $20 – $100 per month per vacancy.

Small businesses (less than 200 employees)

For smaller businesses, you’ll probably be better off moving onto a more standard pricing model where you’ll be paying per user, or just a flat fee for the year. That said, you’ll probably want an ATS that allows you unlimited users and vacancies so you don’t get half way through the year and find the cost’s gone up.

Depending on the features you’re looking for, how important the quality of the support experience is to you, and whether you need any custom integrations (which some ATS providers do charge extra for) you’re likely to need to budget somewhere between $5,000 and $15,000 per year.

Larger Businesses (200+)

This is where things get a little more complicated. Larger businesses often have dedicated in-house talent acquisition teams with more complex needs and pre-defined processes that need to be accommodated.

Again, what you’ll pay will very much depend on the features you’re looking for and how important things like user experience, ongoing training, future development, and support are to you. But you could be budgeting anything from $10,000 to $100,000+ per year depending on the size of your company.

Enterprise

Once businesses reach a certain size, they often have much more complex requirements: more integrations with legacy systems, more customization of workflows, more complex support and training needs. The largest companies can even end up with a vendor’s customer success manager dedicated to them full time.

Again, I can’t do much more than offer a range here. We’ve worked with companies that spend $50,000 per year and have fairly simple requirements. I know others that are spending upwards of $1m per year on their recruitment software.

But just because you’re a big business and your competitors are spending a fortune, it doesn’t mean you have to as well. By choosing more modern applicant tracking software that’s always been cloud-based rather than on-premises, you can make significant cost savings over some of the more traditional enterprise software providers whilst getting access tools that are more aligned to modern recruitment approaches, and software that’s a pleasure to use.

Here are a few things to consider when considering return on investment of a good applicant tracking system.

Displacing recruiters

A good ATS with build in recruitment marketing automation will mean that your organization can stop relying on recruiters, and start attracting candidates directly. Therefore, no more 5-20% payout on annual salaries of new hires. Instead, you can estimate a 2-3% of salary spent on digital advertising to attract the applicant. Decent saving.

More efficient advertising spend

Once you’re using a good reporting tool, you’ll be able to see which advertising channels are actually working and serving your business well. Making you better poised to make better decisions going forward.

Better people

Better teams means more productive employees.

Reducing the time to hire

Through a combination of process improvements, and attracting the right applicants faster, the right ATS will help you reduce the time to hire meaning you get the right people in the right seats faster and make less hiring mistakes.

Automating manual processes

Reducing admin means that you don’t need additional staff to do routine tasks. Now your team is free to invest their time in improving the candidate experience, and promoting your employer brand resulting in it being even easier to attract great people.

Let’s be honest, showing your CFO that you got a great deal will go a long way to getting them on-side.

Here are 4 ways you can make sure you’re getting the best deal when buying an applicant tracking system:

1. Negotiate a discount for a multi-year contract.
2. Negotiate a discount for pre-payment of multiple years in advance.
3. If you think you’re going to grow, make sure you fix your price for the duration of the contract.
4. If you know cashflow’s an issue for your business right now, and the total cost is less of a problem, ask if you can pay monthly or quarterly.

Read more here: How to get the best deal from HR tech vendors

As with anything the cost of an applicant tracking system will often (although not always) reflect the amount of investment that’s been made into the software and the team that supports it.

Things like the range (and depth) of features, the quality of the user experience, the support and training on offer, and the future development roadmap for the platform will all be reflected in the price.

As will the high maintenance cost of legacy systems.

It’s also worth being aware that the price that’s quoted upfront, isn’t necessarily the price you’ll end up paying.

Even once you’ve decided on the applicant tracking system you want to invest in and got your final quote, there are a couple of ways you can be caught out on price. So, ensure that you check:

• What onboarding support is included in the fee you’ve been quoted. Ask your vendor to get specific. What training’s included? What help guides are available? Will you get help configuring the system or will you be left to figure it out yourself?
• Whether your vendor’s planning to migrate all of your data as part of the fee.
• Whether all the features you saw on the demo are included in the package you’re buying. (Or were you shown some features that are important to you, but only available in more expensive packages?)
• Whether you’ll need to pay extra for additional users, vacancies, or candidates.
• Whether the integrations you need with other systems are included in the price, and whether there are any additional usage costs for those integrations.
• What training’s available to you post-onboarding either for your existing team or any new hires you make. Does additional training cost extra?
• What support’s included in your package (e.g. phone, email, live chat).

You’ll want to consider the different ways an applicant tracking system can return value to the business as a whole. Here are a few of the ways businesses get an ROI on the right applicant tracking system:

Displacing recruiters

A good ATS with build in recruitment marketing automation will mean that your organization can stop relying on recruiters, and start attracting candidates directly. Therefore, no more 5-20% payout on annual salaries of new hires. Instead, you can estimate a 2-3% of salary spent on digital advertising to attract the applicant. Decent saving.

More efficient advertising spend

Once you’re using a good reporting tool, you’ll be able to see which advertising channels are actually working and serving your business well. Making you better poised to make better decisions going forward.

Better people

Better teams means more productive employees.

Reducing the time to hire

Through a combination of process improvements, and attracting the right applicants faster, the right ATS will help you reduce the time to hire meaning you get the right people in the right seats faster and make less hiring mistakes.

Automating manual processes

Reducing admin means that you don’t need additional staff to do routine tasks. Now your team is free to invest their time in improving the candidate experience, and promoting your employer brand resulting in it being even easier to attract great people.

Traditionally an HRIS helps to manage things like accounting, payroll, and management.

Increasingly, HRIS tools are introducing some recruitment tools. These are sometimes enough for organizations with low recruitment volume, or in less competitive industries, but for organizations that are hiring in competitive markets they typically choose a dedicated recruitment tool in the form of an applicant tracking system.

Applicant tracking systems are designed specifically to help attract, hire and onboard the best talent. Feature-wise, they go typically go much deeper and will help you significantly improve your recruitment when compared to using the built-in recruiting tools that come with some “all-in-one” applicant tracking systems.

Most applicant tracking software will integrate with your HRIS to allow you to push information about new hires directly into your HRIS meaning even if you choose to buy a separate ATS and HRIS, there will be no manual data entry or room for error.

There are a number of ways in which applicant tracking systems are priced. Many ATS providers will charge extra for various things such as the number of users, the number of roles you want to advertise, even onboarding and the customer support at lower tiers is often really limited. (Sidebar, at Pinpoint, we don’t charge extra for any of this stuff. It all comes as standard because we want you to use all of the really useful features we’ve built – and our customer support is unlimited, always).

Here are the main applicant tracking system pricing models:

1. Pay per recruiter (PPR): So, you pay per user you have on the system. We don’t believe in this, as we want your whole company to use our ATS.
2. Pay per job: Again, we believe that this discourages use of the software… surely you shouldn’t be penalized for using a system you’ve purchased?
3. Pay per employee: Total price of the software can be based on how big your company is – so there is a price per head.
4. Flat fee: So, no matter how many users, how many roles or employees you pay one flat fee, once usually for a year’s subscription. This is how our pricing works at Pinpoint. Why? Because we want you to really use the software to its fullest potential including using all features we’ve built to make your job of attracting, hiring, and onboarding the best talent easier.

By choosing the right ATS, most organizations find they can get a positive return on investment. In this way, the cheapest solution often won’t be the right one (even from a purely financial standpoint). So understanding the likely return on investment for your unique set of circumstances will be the best way to set your applicant tracking system budget.

At Pinpoint, we have one price unlocking full access to our software and unlimited support – for as many users as you like because we believe everyone in the business should be involved in recruitment. Our enterprise plan also includes unlimited vacancies because we believe that great businesses are “always hiring” – even if they don’t have vacancies right now.