Contract Renewal - what to do?

[TheFaQQer]

Indeed but chances of that for most, let alone a new contractor are?

Greater than the zero that you suggest.

New contractor may well have priced themselves low, client may have said that they would only pay a low rate as taking a chance on a newbie - now's the chance to find out.

[northernladuk]

Greater than the zero that you suggest.

New contractor may well have priced themselves low, client may have said that they would only pay a low rate as taking a chance on a newbie - now's the chance to find out.

Yup. I'll accept that.

[JimC]

I took a lower rate when first started as I was new to contracting with the idea to renegotiate after 6 months once I got in the door. I found out what the rate my client is paying for me and pretty confident they want me to stay on my skill set is quite rare to find.

I want to squeeze the agents margins as I know they're taking quite a bit from my initial rate, not from the client.

But what should I do regarding to line managers email? Should I reply back to just say thanks for renewing my contract and wait for the agent to come back with the new contract and negotiate the rate with them?

[northernladuk]

I took a lower rate when first started as I was new to contracting with the idea to renegotiate after 6 months once I got in the door. I found out what the rate my client is paying for me and pretty confident they want me to stay on my skill set is quite rare to find.

I want to squeeze the agents margins as I know they're taking quite a bit from my initial rate, not from the client.

But what should I do regarding to line managers email? Should I reply back to just say thanks for renewing my contract and wait for the agent to come back with the new contract and negotiate the rate with them?

Correct. Your contract is with the agent not the client.

[TheFaQQer]

I took a lower rate when first started as I was new to contracting with the idea to renegotiate after 6 months once I got in the door. I found out what the rate my client is paying for me and pretty confident they want me to stay on my skill set is quite rare to find.

I want to squeeze the agents margins as I know they're taking quite a bit from my initial rate, not from the client.

But what should I do regarding to line managers email? Should I reply back to just say thanks for renewing my contract and wait for the agent to come back with the new contract and negotiate the rate with them?

If you only intend on reducing the agent margin, and not getting an increase from the client, then accept the email subject to the agency providing you with an agreed contract. Then deal with the agency and explain that you expect them to cut their margin significantly / slightly / negligibly and not pass on that change to the client.

[chopper]

Any advice please

The question you have to ask yourself is what you will do if they say no.

If you are prepared to walk if they say "no", then ask away. If you'd say "ah well, worth asking" and sign the renewal anyway, then don't bother asking.

So it depends on how confident you are that they wont just say "OK, bye".

[heyya99]

Always ask but state a reason why you require an increase (matching market rates is a fair one in my opinion). You'll most likely get a no. If so, no harm done.

If you really want a rise, then tell them you're not renewing after you get the no. They'll say go fuk yourself and you're on the bench (more chance of getting struck by lightning on the way home from picking up a lottery cheque), or they'll think you're serious and pay up. I'd take the no graciously, but request a few days to consider it. The agent may panic, sensing you're seeing if a better offer comes up (unlikely).

I've had many rate rise battles; some I've won, some I've lost, so judge your own situation.

Gig 1. Told by an agent that the client would like to offer the gig but at £25 less as 'I was less experienced than they wanted' (lie). Being desperate, I accepted on the premise that I'd get a £25 upon renewal. When renewal came, I got my £25.
Gig 2. Renewal time, on the phone to consultancy HR lady, I demanded a £75 rise. Immediately, she said 'oh we can only give £40'. Sensing I had the upper hand, I signed a £60 increase.
Gig 3. Flat out no for 3 renewals (after a pretty insistent fight). I had a very tasty starting rate so didn't mind.
Gig 4. Another no but offered a significant raise when I said I was leaving. It was too late; I left.
Gig 5. None.

Bottom line: fear not, they won't say Ok, bye.

[northernladuk]

Always ask but state a reason why you require an increase (matching market rates is a fair one in my opinion). You'll most likely get a no. If so, no harm done.

Not really after 3 or 6 months. Market rates won't have changed and you accepted the gig at the rate initially. I don't think accepting a lower one and then complaining it's not in line with market rates is a good excuse at all.

I've had many rate rise battles; some I've won, some I've lost, so judge your own situation.

I'm looking forward to this.....

Gig 1. Told by an agent that the client would like to offer the gig but at £25 less as 'I was less experienced than they wanted' (lie). Being desperate, I accepted on the premise that I'd get a £25 upon renewal. When renewal came, I got my £25.

So the agent screwed you, made £25 quid more for absolutely nothing and played a blinder giving you it back at renewal so you were a happy bunny. Great.

Gig 2. Renewal time, on the phone to consultancy HR lady, I demanded a £75 rise. Immediately, she said 'oh we can only give £40'. Sensing I had the upper hand, I signed a £60 increase.

Fair dincum this one so good result but 'demanded'? Really? I bet you didn't[/quote]

Gig 3. Flat out no for 3 renewals (after a pretty insistent fight). I had a very tasty starting rate so didn't mind.

So why have a fight? How many times will you lose? You were never worried about pushing it too far and getting binned for being a pain in the arse? Doesn't sound smart this one.

Gig 4. Another no but offered a significant raise when I said I was leaving. It was too late; I left.

Liking your principles on this one to be honest.

Bottom line: fear not, they won't say Ok, bye.

Not completely sure about that. You can make yourself unpopular which will have consequences down the line so a modicum of care is balance is required. Going in carte blanch expecting a rise every time you are renewed because you think it's your right is incorrect. Leveraging situations and reducing agents commission etc is good business though.

[northernladuk]

What percentage are they taking?

What they should be taking will depend on the client. If they have a load of contractors in they should be taking a lower rate. You could argue if this was they case they should be on fixed margin but hey ho. If it's a client with just a few contractors in the agent has more work to do so margins can be higher.

Taking an average view agents on here before have told us 6-15% initially is about right, a little lower for renewals. Anything above 15% is starting to get a bit hefty and you would be quite right to push it and there would be no reason you wouldn't get a little bit back. Anything 20% and over then the agent has screwed you because you are a newbie and you need to address that. It happens a lot.

[heyya99]

So the agent screwed you, made £25 quid more for absolutely nothing and played a blinder giving you it back at renewal so you were a happy bunny. Great.

You're contradicting yourself grumpyballs. When this 'screwing' happened many moons ago, I'm almost certain you were in the 'the agent didn't screw you, you accepted the rate he offered' gang when I called unfairness. To be honest, it was that screwing over (and you're right, I as screwed over) that taught be a lesson on agents. I've doubled my rate in 5 years of contracting thanks to that lesson.

So why have a fight? How many times will you lose? You were never worried about pushing it too far and getting binned for being a pain in the arse? Doesn't sound smart this one.

Here we go again with the doomsday scenarios, the fear-mongering. Binned? Unless you're a crap resource, the client will want to keep you. Trying to get the best financial deal for yourself should be applauded. All they must do is say no. Plus, the fight it always with the agent, not the client. I maintain great relationships with clients. With agents, we both know we're playing dirty; we just never say it explicitly. After the fight, we shake and move on until next time.