Negotiating rates

**malvolio** · 27 September 2005, 14:28

Quick answer - no.

Slightly longer answer - negotiate the rate you are happy with. Equally, take it too far and you won't have a contract at all.

If you subsequently find out you could have got double that, well shame but better luck next time. However, if you get a renewal, you have some ammunition to get the agency to drop their cut and pay it to you instead. Agonising over agency rate is one way the an ulcer, so it's better not to try.

Also, if you're just starting out (are you??), you aren't going to get full rates, since you have no history as a freelancer and the agency will see you as a higher risk proposition.

Finally, your consultancy client is likely to be charging you to their end clients at probably double what you get, as a minimum. Where do you stop with the "I want some of that" line...

**BlasterBates** · 27 September 2005, 15:46

Forget the agents cut, the point is you should know the market rate, then pitch in at either below or above average depending on circumstances.

If you don't have a contract and its the first interview after a couple of weeks you pitch in low, if you're angling for a new contract in the comfort of a long-term rolling contract then you can pitch in high.

But the agents cut is largely irrelevant, in any case the agent will also go in at the market's agent rate, so as long as you pitch in at the contractor's market rate the cut will also be "market".

The agent's cut isn't down to the agent, it is actually down to you.

I'm always amazed at contractors that moan about the agent's cut, when they've only got themselves to blame.

**thunderlizard** · 27 September 2005, 17:32

First off if you signed the contract at rate X happily in the first place, you shouldn't get upset if the agent turns out to be getting a 95% margin, or think that that money is somehow rightfully yours.

BUT if you discover an extra couple of hundred a day is sloshing around in the system and ending up in the agent's pocket, you'd be daft not to have a crack at getting some of it for yourself!

**malandri** · 27 September 2005, 22:01

I haven't signed anything yet. I have heard that in some contracts, the agent has to let the contractor know his margin. Is that true?

**tim123** · 28 September 2005, 07:28

Originally posted by malandri

I haven't signed anything yet. I have heard that in some contracts, the agent has to let the contractor know his margin. Is that true?

In *some* contracts yes. But not in one that you are likely to be given.

tim

**malandri** · 28 September 2005, 09:54

Agent talk

They are good sellers (or they think they are). I talked to her yesterday again and she kept telling me about putting me under their umbrella company, save me tax!!!! , allow me to do expenses!! How kind

It reminds me when i bought a house some months ago and the estate agent was insisting that i should get the mortage, solicitor and everything else from them, so that they move me in 2 weeks faster (it is so much easier if we keep everything under the same roof, they used to tell me...)

Yeah, right

I HATE THEM!

but i suppose since i chose this road i must learn to live with them...

**ratewhore** · 28 September 2005, 09:57

I ran a couple of contractors through an agency and they gave me a load of tulip about needing to know what I paid them as my margin had to be within a certain range. I told them it was none of their fecking business...feckers!!!

**malandri** · 28 September 2005, 16:35

Originally posted by ratewhore

I ran a couple of contractors through an agency and they gave me a load of tulip about needing to know what I paid them as my margin had to be within a certain range. I told them it was none of their fecking business...feckers!!!

How dare they ask you that! Well, maybe if you pay them 300/day and you charge the client 500/day, the client has different expectations and this affects them

From what i heard from other contractors though, sooner or later, and especially when the client and the contractor develop a good working relationship, the agency margin is no longer a secret...

**Lucifer Box** · 28 September 2005, 17:27

Originally posted by malandri

How dare they ask you that! Well, maybe if you pay them 300/day and you charge the client 500/day, the client has different expectations and this affects them

From what i heard from other contractors though, sooner or later, and especially when the client and the contractor develop a good working relationship, the agency margin is no longer a secret...

I've never known a PM yet who wasn't prepared to openly discuss agency fees at renewal time. They are just as keen to get value for money as anybody else. Additionally I never involve the agent in renewal negotiations and try to work with the client to present the agent with a fait accompli. Everyone is happy then, except possibly the agent but if they were charging a fair fee there's nothing for them to worry about. The agent may try and keep it a secret but he's wasting his time - it will only piss the client off if they're creaming off an obscene margin.

Negotiating rates