found out my agency is making 400

[TheFaQQer]

Some agencies, mainly those on Preferred Supplier Lists, agree with the client that they will charge a set percentage for all contractors they supply. So if contractor A wants £200 and contractor B wnats £300 and the agency has agreed 10%, they will charge the client £220 for A and £330 for B.

But can you see the slight flaw in that arrangement? And why some contracts say that you must not discuss rate with the client or other contractors? For example, suppose the agency charged £330 for bnoth contractor A and B...?

If the agency is on a good deal with the client, then they would be a bit stupid to charge £330 and only pass on £200. It only has to slip out and there will be hell to pay. That said, some agencies are more willing to tell you their rate than others - current one told me "the client knows what we are paying you, as it's fix rate" but wouldn't tell me the rate. Some I've been talking to this week told me their margin without me even asking what they took, which impressed me.

[TheFaQQer]

I think taking that kind of margin is crooked and deserves to get the agency booted from the clients books.
They've taken £400 a day from the client in order to supply them with a 'resource' that the client thinks is worth £350 a day. What they end up getting is either someone who is worth far less in which case they're not getting value for their money or they have someone who is worth it but pissed off because he's underpaid.
The agency has either told the client he needs £400 to find someone and then gone and gotten the cheapest they could find or found someone cheap and then lied to the client about how much it costs. Either way teh client will be pissed. When I was buying hardware from a preferred supplier it was on a negotiated fixed markup. They expect similar deals from agencies.
Tell the client you can't renew next time because you have a better offer through an agency that doesn't take such a huge markup on your rate. You're not telling them what your current agency is taking or what they're paying you. They'll work it out easily enough.
The most important thing is have another contract to go to - it makes negotiating a good renewal a lot easier and then if they won't pay up walk away and go to the new gig.

K

Not necessarily - if the client has a budget of £400 to find the best person, and they are convinced that they have found a good person, then they are getting what they wanted for the rate that they want to pay. Why should they be pissed with the agency, for fulfilling their remit perfectly? The OP has said that he's the best there, so why should the client be upset to be paying what they regard as market rate.

Rates are between client and agency; agency and contractor - as long as both ends of the chain are happy, then what happens in the middle is immaterial. The question the OP should really be considering is "if I had no idea about what the client pays, would I be happy?" If not, then move on; if yes then stay or do whatever you want.

[shoes]

It sounds like the end client are not paying the market rate for the skill required, they are overpaying. This is likely to be due to the agent in the first place managing to get a good price for what he is selling. If the end client isn't smart enough to shop around a bit before agreeing a cost for a resource that's their problem. Chances are they don't care much as in the grand scheme of their business it's probably neither here or there if they spend a few hundred quid a day more than they strictly need to.

I recommend looking into the market for your skillset and seeing what you're skills are worth to other agencies (or end clients if the problems of going direct are not an issue for you). At the end of your current contract use this information to get a rate more in keeping with the market. The information you have tells you they can afford to pay you the market rate for your skills, I'm afraid this is all the use you can get out of it. The fact that the agent has managed to get way over the market for you is a mixture of an achievement on their part and a mistake by the client, it's not actually got much to do with you.

Be wary of telling the client they are overpaying for someone with your skillset ; Always bear in mind the possibility of future business with this client if you wanted to go direct at a later date.

[tim123]

Reputable agencies will tell you their cut, !

I'm not sure what you consider a Reputable agency but IME they wont. They will tell you if you push them but they won't volunteer it.

And they are just as likely to lie as any other agent.

Of course, if you are on a PSL where the margin is dictated by the client they will tell because they have no way of keeping it secret, but not all of us work in world of PSLs.

tim

[threaded]

My my, it's the capitalist system, it's how it works. Get over it!

I did a job for a company, got paid maybe a couple or three grand for it. Company later sold themselves to M$ for several million £. M$ later admitted they only bought the company to get their hands on that bit of software.

[TheFaQQer]

My my, it's the capitalist system, it's how it works. Get over it!

I did a job for a company, got paid maybe a couple or three grand for it. Company later sold themselves to M$ for several million £. M$ later admitted they only bought the company to get their hands on that bit of software.

It's like the intern who's just invented a green energy saving device for Tescos, which will save them millions a year. But he's won a prize worth £1000 for his work!

If you're not happy with what you are earning - find something else to do.

Threaded - are you owning up to writing Vista?

[arthur_cider]

The fact that you now know how much the agent makes puts you in Jeopardy,

If you like the contract, take it on the chin and keep 'shdum'

[trsisko]

I will not say anything about it, theres no point if my contract gets renewed they will ask me to switch to another agency which is fine, but more then likely it's time to look for work else where, im a low level work and truth be told i dont deserve 17pounds an hour.
Need to work on my skill set as i have none.

[meridian]

If the agency are no longer being used, then go direct.

Wander up to your manager and offer to renew direct for £350 a day to save them some dosh.

[arthur_cider]

"Wander up to your manager and offer to renew direct"

.. and you'll be out the door b4 the pubs open