Another rate question
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  1. #11

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    Quote Originally Posted by northernladuk View Post
    OK.. So you said.



    For a start why do you think it's rude for the agent to make it from his margins. Where is your business sense. His margins is his profit. He's put the effort in finding you, paying for jobserve and it will make him a profit over the duration of the contract. He puts a bit of effort in at extension and that's it. The rest is free money for them, they've already done the work so why shouldn't he reduce his margin. It's just business 101.

    You really think an agent is going to tell you what is profit margin is? Where else can you go and someone you are buying from tells you their profit margin? The only time they may tell you is when it's really low and they've nothing to hide, either a fixed percentage deal or it's like sub 10% already. He's happy to tell you because it will be so low they aren't going to budge. They aren't going to turn round and tell you they are making 20% from you are they? The result will be you will squeeze him or get hacked off and possibly leave.

    No it isn't any of your business what his margin is. Finding out and reducing it is though. You should be asking the agent if they are on a fixed margin at the start of the gig and get it in writing. If it is fixed there isn't a hope you'll get an increase from his margin. You can often find out by keeping your eyes open on site. Not so common to find it on the printer anymore but look at charge rates for projects or possible slip ups in mails, paperwork on hiring managers desk etc. You should be able to find out at some point on many gigs.

    It's very unlikely you'll get a rate rise from anywhere else. The client is likely to have a rate card and they aren't going to give you any more because your costs have gone up. They are paying for a set piece of work. You aren't delivering anything else so why should they pay more. If you don't like it they'll find someone else.

    You've got to understand this stuff if you are going to play agents. They do this day in day out. They will have lost count of the number of contractors that 'ask' for a raise, they say 'no, what are you going to do about it' and the contractor just re-signs. It's what they do. If you don't know how it works you aren't going to be able to play him at his own game.
    Thanks for clarifying that, it makes sense.

  2. #12

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    Well email sent let's see what his response is
    Client already informed me they wanted to renew a few days ago and I know they have been struggling for good senior devs up north

  3. #13

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    Quote Originally Posted by akhtara7 View Post
    Thanks for clarifying that, it makes sense.
    No problems. Another few points to consider in general...

    You should be able to gauge the type of engagement which will also help your decisions/negotiating.

    Is it a big client with a single agent handling many contractors, probably very low margins
    Big client, multiple agents - Could be a bit cut throat between agents so less likely to be massive margins
    Small client, small agency - Could be an opportunity for wiggle room as the agent isn't fixed and will be trying to make as much as they can. Watch for having your pants pulled down on gigs like this but in general commission will be higher so don't be surprised if it's 15% plus and they still won't budge.

    If you are through a small consultancy then everything could be different again as they'll be charging you out at anything up to 100% of your rate. Could be easier to request a small uplift without having a battle.

    It's very hard to generalise. There is no rule book so up to you to understand the situation and how they are doing business and act appropriately. As ever there are exceptions to the rule so don't use it as a check list. Just understand and do your best in each situation.
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    Talking Good News

    A quick update, i got my rate increase in full.

    Agent mentioned they were on a fixed tight margin so would need to ask the client but didn't see a problem with the rate going through. This morning client informed me that my rate increase had been approved and would be given at next renewal, also confirming with me directly the amount agent was saying i wanted. I was pleased the amount mentioned to the client was the amount i had requested and not agent adding an extra few quid for himself.

    I find these small agencies much better to deal with, than bigger ones

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    Wow nice win. Not that common for client to raise the rate and even less so for them to tell you directly either.

    Agent can't add a few extra quid because they are on a fixed margin.

    Just a word of caution though. We had a guy on here a week or so ago that discussed rates with his client when his contract forbade him to do it and got in hot water. Make absolutely sure it's not in your contract before discussing anything with the client.
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    Quote Originally Posted by northernladuk View Post
    Make absolutely sure it's not in your contract before discussing anything with the client.
    And if they are make sure when you get a new client such clauses are removed.

    Simply say to the agent that it is fair that the client knows how much you are getting plus it will only be mentioned to management responsible for choosing you anyway.
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    Quote Originally Posted by northernladuk View Post
    Wow nice win. Not that common for client to raise the rate and even less so for them to tell you directly either.

    Agent can't add a few extra quid because they are on a fixed margin.

    Just a word of caution though. We had a guy on here a week or so ago that discussed rates with his client when his contract forbade him to do it and got in hot water. Make absolutely sure it's not in your contract before discussing anything with the client.
    I was sure there was nothing mentioned about discussing rates with the client or other contractors (just double checked the contract and no mention of it)

    After the email from the client i did contact the agent giving them an update and mentioned it was the client who contacted me, since it wasn't something i was expecting as it had only been a few days since i requested the rate increase. He was just pleased that i had got the increase and thanked me for letting him know.

    I was surprised the client told me, maybe because it took them a few days to get the ok from the higher ups and didn't want me to walk! I have seen a few contractors let go for being rubbish too.

    Quote Originally Posted by SueEllen View Post
    And if they are make sure when you get a new client such clauses are removed.

    Simply say to the agent that it is fair that the client knows how much you are getting plus it will only be mentioned to management responsible for choosing you anyway.
    oddly enough when he told me was on small margins, he did say i could confirm it with the client. Which does match up with what northernladuk said earlier, large client and a number of agents being on tighter margins.

    So a good week overall

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    Good job OP!

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    Quote Originally Posted by tarbera View Post
    try to hold off asking until after the budget on 22nd November, as if the widely expected IR35 rules are adopted into the private sector you might need to increase your rate by 50%+

    As no more claiming expenses via your company (you will need to pay them from your NET 50%+ tax deducted salary)

    anyone with high (living away in hotels + flights) might as well give up contracting
    Why?

    Worst case scenario he doesn't have to worry about it until April 2018 at the earliest.

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    Quote Originally Posted by northernladuk View Post
    It's very unlikely you'll get a rate rise from anywhere else. The client is likely to have a rate card and they aren't going to give you any more because your costs have gone up. They are paying for a set piece of work. You aren't delivering anything else so why should they pay more. If you don't like it they'll find someone else.

    You've got to understand this stuff if you are going to play agents. They do this day in day out. They will have lost count of the number of contractors that 'ask' for a raise, they say 'no, what are you going to do about it' and the contractor just re-signs. It's what they do. If you don't know how it works you aren't going to be able to play him at his own game.
    good job OP ignored you :-)

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