Reply to: agents (yet again)

[tim123]

The price of fruit & veg in supermarkets never ceases to amaze me. The margins really are utterly incredible. (Also dairy products but I know less about that market.)

But as (I tried to) point out above, the difference is not the margin, it is the cost of doing the other things that have to be done, to get the product on the shelf. For a low value item (especially an easily damaged one) these costs are a considerable percentage of the total selling price.

Comparing the difference between: what the farmer gets and what the shop sells for, is like comparing the price of a new built house with the cost of 10,000 bricks and ignoring all the other costs of building that house. It is a stupid comparison.

What really annoys me is when farmers say that they should get 2p more and someone says that this will put the shop price up by 20p. Why the **** should it? Paying the farmer 2p more should put the shop price up by, um, 2p, none of the other elements of the price will go up just because one of them does.

tim

[BrowneIssue]

Bet they don't, really. You're just making that figure up, aren't you?

The price of fruit & veg in supermarkets never ceases to amaze me. The margins really are utterly incredible. (Also dairy products but I know less about that market.)

[BrowneIssue]

Just found out an agency managed to charge 28-29 % on my contract. I think its a tad excessive. Anyone agree.

Back in the 1990s I had a contract where I found out the margin was about 45%. (This was because the client's Chief Accountant abused me in a meeting and said "We're paying £xxx an hour for that kind of advice?" - I nearly fell of my chair.) (Yes, that was 45% margin, not 45% markup; the markup would have been about 81%.)

That contract lasted just under five years, paid off my wedding bill, paid for a cruise and I have never since earned as much as I was by the end of it.

So, are you gonna walk? I didn't - I negotiated. After I got angry I decided that if the agent was that clever, I should get him working for me.

And I outlasted their Chief Accountant.

[r0bly0ns]

Cleaned ???????

More like "cleaned out"

By the agent, yes.

[DodgyAgent]

But you are comparing apples with oranges (groan).

The difference in price between what Tesco sells the item for and what it pays the supplier, has to cover the cost of transporting, cleaning and packaging the item (which on a low value item is substantial).

A contractor arrives at the end client already: transported, cleaned and packaged.

(And yes, I know that the analogy doesn't work anyway, but I wanted to make this particular point)

tim

Cleaned ???????

More like "cleaned out"

[tim123]

Nope, straight from the horses mouth (or should that be carrots? ).

Anyway I know a lot of cabbages, they think Tescos are worse than recruitment agents (which is why they talk to me )

But you are comparing apples with oranges (groan).

The difference in price between what Tesco sells the item for and what it pays the supplier, has to cover the cost of transporting, cleaning and packaging the item (which on a low value item is substantial).

A contractor arrives at the end client already: transported, cleaned and packaged.

(And yes, I know that the analogy doesn't work anyway, but I wanted to make this particular point)

tim

[SueEllen]

Tesco don't try to keep their suppliers in the dark about the markup, because they can't. Agents must be one of the few industries that try to keep their prices secret.

The supermarkets use different tactics to screw their suppliers which could be worse then some agents i.e. agreeing to buy lettuce of a farmer and then just before it's harvest telling him they don't want it.

[VectraMan]

Tesco don't try to keep their suppliers in the dark about the markup, because they can't. Agents must be one of the few industries that try to keep their prices secret.

[DodgyAgent]

Bet they don't, really. You're just making that figure up, aren't you?

As I said before, I see no shame in maximising profit margin.

Nope, straight from the horses mouth (or should that be carrots? ).

Anyway I know a lot of cabbages, they think Tescos are worse than recruitment agents (which is why they talk to me )

[TheFaQQer]

I would like to name and shame Tesco , who make 4000% mark ups on their cabbages

(I know you are going to ask "what's the difference between a contractor and a cabbage"? but give me time to think about it )

Bet they don't, really. You're just making that figure up, aren't you?

As I said before, I see no shame in maximising profit margin.

[DodgyAgent]

I would like to name and shame Tesco , who make 4000% mark ups on their cabbages

(I know you are going to ask "what's the difference between a contractor and a cabbage"? but give me time to think about it )

[TheFaQQer]

name and shame

Name maybe, but I see no shame.

The aim of any business is to make as much profit as possible, so where is the shame in the agency doing that?

[BigTime]

Just found out an agency managed to charge 28-29 % on my contract. I think its a tad excessive. Anyone agree.

name and shame

[malvolio]

This happens a lot and yes I do care what they are creaming off because I want as much as possible. At next renewal ask for an increase that will reduce their percentage to 15%, they should swallow this and not even contact the end client. They will claim they can't or that the client has said no - blah blah. Dig heels in and if possible talk to the client saying you consider the percentage commission to be excessive.
Of course - make sure you are excellent in all other respects so they actually want to keep you !

Agreed, but the point the OP missed is that you are not setting the rate for the role, that's probably already been set between the client and teh agent. What you get is determined both by what you ask for and what the pre-agreed total rate is less the agency's margin.

In-demand specialists, scarce skills combinations and senior staff can drive the rate to a large extent, but "standard" workers are not really in control of it. Best you can do is study the market rates and aim a shade higher. You should also have a mental rate card - how much for a job next door, then add daily expenses and inconvenience money, then add seniority, then add risk. The first two are non-negotiable, the last two are your variables.

[lukemg]

This happens a lot and yes I do care what they are creaming off because I want as much as possible. At next renewal ask for an increase that will reduce their percentage to 15%, they should swallow this and not even contact the end client. They will claim they can't or that the client has said no - blah blah. Dig heels in and if possible talk to the client saying you consider the percentage commission to be excessive.
Of course - make sure you are excellent in all other respects so they actually want to keep you !