Rate Negotiation

[redgiant]

How do you go about negotiating rates when going for a contract? Do you just stick with the advertised rate in the role description or do you try to get it increased?

Reason I ask is I had a call with an agent this PM about a contract in the City and quoted in the job description a rate much lower than I usually go for (well over 150 p/d lower than the usual going rate). I managed to get him to go higher however I’m surprised that rate was so far off the going rate to start off as it would be in his best interest to go in at the market rate to get the most candidates applying for the role - he also would get a greater payout too.

[amcdonald]

It's in his best interest to fleece you for as much money as possible, it's nothing personal though

[Scrag Meister]

How do you go about negotiating rates when going for a contract? Do you just stick with the advertised rate in the role description or do you try to get it increased?

Reason I ask is I had a call with an agent this PM about a contract in the City and quoted in the job description a rate much lower than I usually go for (well over 150 p/d lower than the usual going rate). I managed to get him to go higher however I’m surprised that rate was so far off the going rate to start off as it would be in his best interest to go in at the market rate to get the most candidates applying for the role - he also would get a greater payout too.

Why would he get a greater payout?

1. If he is on a fixed % markup then yes he gets more.
2. If however he has a fixed rate pd from ClientCo then the lower your rate the better for him, higher margin.

Sounds like 2 may apply, and he started his negotiations very low. You think you have negotiated a rise but really hes still quids in on his worst case rate.

It all depends.

[redgiant]

I didn't think that they would work at a fixed rate. With perm recruitment it tends to be as a % of the agreed starting salary (part paid when the employee is taken on and the rest after 3/6 months). I'm still getting used to how it works in the contractor world. Incidentally is there a FAQ on how contractor agencies work as there can only be so many ways to run one?

Still the worst the agent can say is NO so it didn't do any harm in asking for a higher rate than advertised I reckon. I found out later that this role was advertised online with a higher rate but when he called he said the client was looking for a lower rate and it was a mistake

[SneakySimon]

Rate

You need to assess:

1. How much do you need? - is the rate too low to live on?
2. Are you desperate?
3. Any non-financial benefits - experience / contacts / CV enhancing?

Then
1. If you think role will be ok based on above, go to interview (this may clarify some of above)
2. If you get offered role, now is time to negotiate - you have been selected, your position is strengthened and you can negotiate more - threaten to walk away and agency will get nothing so I am sure that they will be more amenable!!

Good luck - it is always tough in this situation - i/ve taken a few roles which were a poor rate with a view to the role being a stepping stone to something better!!

[Fred Bloggs]

Recent experience from me is that I have agreed to a start in a few weeks time which suits me very well. I suspect I could have got a pound or two an hour more but on balance the client was willing to wait about 7 or 8 weeks for me to end this job and then take two weeks holiday. That is pretty rare. And it is two years work local to home. I thought it best to not push too hard in view of it suiting me extremely well but I might have lost a £ or two an hour. It's a balancing act against risk at the end of the day, push too hard and they could have got someone to start earlier than me and perhaps on a slightly lower rate than me too. So, I accepted and start in a few weeks time.

[Antman]

Hi,

I'm sure that this has been covered already, but what's the deal when the agent says "don't ask about rates at the interview"?

I asked him what his percentage cut was on this role and he couldn't tell me. Should I be suspicious? the rate hasn't been confirmed by the end client and neither has the job spec (still in HR).

Ta,

Anthony

[Wanderer]

I asked him what his percentage cut was on this role and he couldn't tell me. Should I be suspicious? the rate hasn't been confirmed by the end client and neither has the job spec (still in HR).

Some people disagree but I think it's always in our best interests if the client and the contractor both know how much the agent is taking. If the agent insists that you don't discuss it with the client then there is always a suspicion that the agent has a fat markup on this job and they don't want you (or the client) to find out. This is not to say that I begrudge the agent their finder's fee or a fee to factor the payments, just that I want to know how much they are taking.

Should you be suspicious? Absolutely, always be suspicious! You're a business man, aren't you? So get into it and find out how much this deal is worth and make sure you are getting a proper cut. Agents will sometimes get upset about it but that's just their way of doing business, don't take it personally.

[Antman]

Thanks, I'll add it to the long list of questions I've got about the role!