How can I figure out how much clientco pay the agency for me?

[northernladuk]

hi all, thanks for all the help. I have used the tricks you guys mentioned Found out the agency takes 24% of what I earn. I am really pissed off! I did a bit research. The margin is supposed to be 8%-15%!!!!! Shall I negociate it to 10% or 13% when its time to extend my contract, which is soon.

Good win there. I am sure they will budge somewhat on that rate.
I would argue the point about 'supposed to be'. I thought it you could only gaurantee this type of figure on fixed margin stuff with PSL's and large clients etc. The little stuff is open to anything the agent can make so no 'supposed' about it I am afraid. It's up to us to negotiate it down just has you have here.

I expect TAV will be on soon to say something along those lines

Good luck with the negotiations.

[7of9]

at my last place I searched for my name on the companies intranet and came across an unlocked spreadsheet with every contractors rate!

At the time I was on £375 a day and being charged at £525 so I nice little earner for the agent. I asked for a £60 a day rate rise at renewal and they initially tried to pass all of that on the the client who came directly to me and said no. The agent themselves eventually conceded a further £25 from their margin which was more or less what I was thinking I'd end up with anyway.

That's madness!Did they have someone to replace you if you Had walked out?

[The Agents View]

Good win there. I am sure they will budge somewhat on that rate.
I would argue the point about 'supposed to be'. I thought it you could only gaurantee this type of figure on fixed margin stuff with PSL's and large clients etc. The little stuff is open to anything the agent can make so no 'supposed' about it I am afraid. It's up to us to negotiate it down just has you have here.

I expect TAV will be on soon to say something along those lines

Good luck with the negotiations.

You rang?

Right. First things first - there's no argument here - there is no "supposed to be" when it comes to margin. "Reasonable" is anything from about 10% to about 20%. Anything more is probably taking the P, but it depends what your rate is - if you're £200 per day, and they're charging 24% margin, that's not unreasonable. If you're £1000 per day, and they're charging 24%, then fair enough - time to kick off.

Secondly - 24% sounds like a bit of an odd figure. I suspect it's 20% MARGIN.

If they charge 24% on top of what you earn, that's markup, not margin - 24% markup is fairly reasonable for low volume stuff (about 20% margin) - if it's a big company, and the agency has alot of contractors with them, then I'd expect them to operate between 10 and 15% margin (about 14-18% mark up)

To work out Margin, imagine the total cost, is a pie, if the agent gets 20% of the pie, and you get 80% of it - that's a 20% margin.

If you're being extended, negotiate, but negotiate based on your performance and the clients happiness, not "cos the agents making too much" ...they'll just tell you to do one.....

HTH

[7of9]

Thanks TAV. The explanation is very clear. It's definitely margin and it's 25% or even more. My situation is client is relying on me and I got a potential offer that's min 100 pounds more each day. So if the agency is not willing to negotiate I will walk away. Thing is they are not going to get any money from my client if I walk away as clientco has no intention to hire anyone else from this agency. What do you think the chance of me get what I want?

[Wanderer]

hi all, thanks for all the help. I have used the tricks you guys mentioned Found out the agency takes 24% of what I earn. I am really pissed off! I did a bit research. The margin is supposed to be 8%-15%!!!!! Shall I negociate it to 10% or 13% when its time to extend my contract, which is soon.

< 10% is not unreasonable on renewal. The agency have made their money so now they can cut it right back. If they won't budge then play hard ball with them, tell them you know how much they are taking and you want a piece of the action. If they won't play ball then tell them you are going to negotiate directly with the client (who is probably unaware of what the agency cut is) and may get really angry at the agent for taking a large cut.

It's not an easy one though, agents are a really thick skinned bunch and they don't like it up 'em. Also the client may or may not be willing to help you negotiate with the agency. You have to play each one by ear really.

[7of9]

Thanks Wanderer, As long as they get 50£ each day from it, they should be happy, should they? After all, they are not doing any more work and have already taken a lot money for my current contract.

[Scrag Meister]

Thanks Wanderer, As long as they get 50£ each day from it, they should be happy, should they? After all, they are not doing any more work and have already taken a lot money for my current contract.

My previous agent dropped down to 2% after 2 years in a contract. As it happened I didn't get that far.

[TheFaQQer]

Thanks Wanderer, As long as they get 50£ each day from it, they should be happy, should they? After all, they are not doing any more work and have already taken a lot money for my current contract.

The risk factor is neither greater nor less regardless of the length of contract time. Factoring costs do not vary, either.

Starting to talk direct with the client is asking for trouble in my opinion - they will have clauses in the client-agency contract which stops this kind of thing, and probably don't want the grief of getting involved in the arguments that you are having with the agency.

If I was the client and a contractor brought me problems they were having with the agency (which has happened in the past), I've politely told the whinger to do one and fight their own battle.

[2BIT]

hi all, thanks for all the help. I have used the tricks you guys mentioned Found out the agency takes 24% of what I earn. I am really pissed off! I did a bit research. The margin is supposed to be 8%-15%!!!!! Shall I negociate it to 10% or 13% when its time to extend my contract, which is soon.

just tell the client that you are looking at a new contract (that pays you 14% more) but that if the rate was matched you'd stay as you love working here blah blah blah- client may well go back to agent and force them to take a lower margin (say 10%) and you wont have to get involved with any of it - don't give any more info than is needed

[7of9]

After I told the agent that I got potential offers somewhere else. He stops contacting me. Both my client and I absolutely hate this agent. He is a replacement as the guy (who is equally rubbish) found me at the first place left the company.
Can I request the agency to change my agent? I know one of the agents working there and he is a lot better.