Contract extensions and rate rises

[WTFH]

The client is aware of my value and I have helped the business during a crucial time.

We aren't civil servants or employees but we do run a business and its all about the revenue that we generate. If my contract has been extended multiple times and I am not receiving the market rate then I have every right to ask. From my understanding its a very common occurence in the contracting industry. Don't ask don't get.

You have the right to ask.
The agent has the right to laugh at you.
The agent possibly also has the right to terminate your contract immediately if you have been discussing rates with the end client (check your contract)

How did you work out what “market rate” is?
How many years experience do you have in contracting?
Would you be prepared to work for free?

[LondonManc]

If the agent is getting 400 and giving you 375 of it, you're doing fine.

[Unix]

Ask for £400 if you think that's your worth from the agent, it's up to the agent to work out how to get that with their cut on top.

[billybiro]

The other and rather more crucial question is what have you done for the client to warrant them paying you more?

Again with this nonsense.

What extra value does my gas & electricity provider deliver when they put their rates up yearly? What extra value does my internet provider deliver when they put their rates up yearly? etc.etc.

And besides all that, there is such a thing as inflation.

OP - You don't have to "prove" you've done something extra to justify asking for more, so go ahead and ask. There's no guarantees you'll get anything, of course, but if you don't ask, you definitely won't get anything!

[malvolio]

Again with this nonsense.

What extra value does my gas & electricity provider deliver when they put their rates up yearly? What extra value does my internet provider deliver when they put their rates up yearly? etc.etc.

And besides all that, there is such a thing as inflation.

OP - You don't have to "prove" you've done something extra to justify asking for more, so go ahead and ask. There's no guarantees you'll get anything, of course, but if you don't ask, you definitely won't get anything!

Actually you are not wrong. But it does no harm to remind the OP that (a) the client has a budget, not a bottomless money tree, (b) the £400 is the agent's money and the OP only gets some of it, therefore (c) what has the agency done to warrant a pay rise from the client, other than supply a resource who is doing the best job he can already.

Inflation is a factor, of course. 2.6% on £375 is about £9 so that rise is up to £384, not the 6.25% he's looking for to reach £400.

And if he's running a business and the rate is better elsewhere, the obvious solution is to stop with the renewals and go out the real world again.

BTW the first think I ask when one of my contractors asks for a rise is "Why?", to which I get the usual answers. Then it's "What added value have you given me over and above what we are paying you for", which is when they start to struggle. Don't dismiss that approach so readily, and make sure you have good answers ready.

[fool]

Then it's "What added value have you given me over and above what we are paying you for", which is when they start to struggle. Don't dismiss that approach so readily, and make sure you have good answers ready.

They probably don't respond well to that because it's a silly meme question that nobody would expect a professional to ask.

Getting a rate bump is about leverage. Adding additional value for free is a good way to lose assumed leverage, but leverage in this business is simply a case of whether it costs more or less to replace you with another resource, whether you can really get that rate elsewhere, and whether that makes up for downtime in-between and the stability effects of annoying a paying client.

That said the following will also screw you over:-

• Stubborn Human Emotions - The type of argument you're making falls under this, but this will only really stand if you bungle the request.
• Negotiation Skills - Who blinks first. Most contractors suck at this.
• Bureaucracy - Finance sets max rate, you'd need to be working with something with the political will and power to bypass this if you're asking for more than a max.
• Budget - If you push the overall budget over a max, then the project can't really be complete, which makes any leverage useless.

[ContractorBanking]

The OP knows the client is paying the agent £400pd but what is not known is if that is cost-plus or cost-inclusive.

If its cost-plus, then the client should get the full £400. Lots of IB operate in this way and agent is on a fixed margin, on top of the rate.

[psychocandy]

Having worked at a number of clients for a number of years in a few cases I don't understand this reasoning that the rate is set in stone forever. If I work somewhere for the next 20 years the argument "well you get a decent rate already" is not valid.

As others have said, not talking massive amounts here but there is inflation and changes to market rate. If a client refuses to move rate AT ALL over a number of years then in "real terms" you're getting less surely.

Glad to say current client agrees with me and recently OKed a 4% increase. No piss taking on my part, not a huge amount, and better than a poke in the eye.