Reply to: Negotiating rates

[jonhaff]

even if opted out you can still negotiate with an agency and client about going direct, you can usually agree something like a placement fee instead, effectively buying out their original agreement. (ive done this in the past)
its all down to all parties being happy with it. If not then no it wont happen.

I know from all these posts that it shouldnt matter what the agent gets as long as you get what you asked for but say you get 300 and the agent 600 then yes i would expect 99% of you to be pi**ed off, YOU the contractor does all the work, agencies have only found you and done a little bit of paperwork that certainly isnt costing 300 a day is it (even my accountant doesnt charge that and they do all my paye/nic/vat)!!

I have also had the customer come to me and say well you are a little expensive to which i say well i was hoping to increase my rate (cos in yr mind it was low) its at this point you find out the margin and yes at this point you need to reneg the agent margin in order to keep yr job, it can be done as the agent wont want to lose the client so they are potentially likely to make some small adjustments. But it still anoys the hell out of you to be in this position in the first place.

[Reccon]

Agents!!

Think the fact that the agent wouldn't disclose the rate tells you that he was trying to pull a fast one - we have a policy to be totally open with rates - if all agents where the same then maybe there wouldn't be such a divide between agents and contractors

Owen - was going to suggest that you check your contract and see if there where any restrictive clauses in your contract that stop you going back to the client for a certain amount of time! May have been a way around it!

Also how did your "friend" get on finding his contractors??

[omen666]

Valid stuff and yes I have stated my position and won't move from it. Agent knows I'll move on if it doesn't happen.

We'll see.....

Well we tango'd and the agent has taken my price and clients price and had 10% knocked off their margin

So my company and the client are happy, not sure about the agent though

Its still a good result for them though really, just a more balanced arrangement all round

[omen666]

Valid stuff and yes I have stated my position and won't move from it. Agent knows I'll move on if it doesn't happen.

We'll see.....

[BlasterBates]

What you do is work out what you want, what is your market worth. Then simply put this forward to the agent. What cut the agent takes is between him and the client. Either the agent says yes or no. Market forces will push the margin down.

Golden rule number one - don't involve the client

Once you involve the client and collude he'll also want something out of it. If he realises the agent's taking 25% he'll push the agent to drop the rate that he's paying, so in the end you'll get a lot less than if you were to push the agent alone, unless of course you have a "philanthropic" client, which I haven't yet seen.

Look at it on the positive side, discovering a "generous margin" is like discovering a bag of gold in the pavement, its yours for the taking, so why point it out to someone else?

[omen666]

Well we've had a tango and confirmed the agent is taking 25%

So not as bad as I suspected, but we both sorted out the amounts we are comfortable with and now the agent is getting arsy

So we are waiting the agent out. Bottom line they will take the deal it is still 15%.

If they don't am I free 'agent'? I opted out of emp regs, but where does that leave me?

Common sense says if the agent 'walks' from the deal, it between myself and the client to do as we like. But I am aware common sense is a rare decider in this world.

[Fungus]

I believe that quite often the client is contractually forbidden from revealing the rate they give to the agency. After all it is a commercial secret since the contract is between the client and the agency, and not you. My previous client let me know the rate, but others didn't know. The bloke who signed the documents for my current client would not tell me the rate. He said that the last time he revealed it, there was a massive hoohah. But with a little gentle haggling I got him to confirm that the client has a policy to restrict agencies to between 15% and 21%, and he confirmed that I was not being screwed, which was all I wanted to know.

Fungus.

[Lucifer Box]

He is suggesting he doesn't know my rate and hasn't specifically asked the agent what margin they are applying otherwise he could do the maths.

Tell him then.

Your general approach is correct and you must, of course, be prepared to walk if you don't get the rate you want, but it seems both you and the client are pussy footing around the issue. As I said, it does take two to tango and are you really sure that both you and the client are up for the next dance?

[omen666]

What? That is complete bollox. How can your client not know what they are paying for your services? Do they just tell the agency to direct debit their bank account with whatever they think is fair?

If they won't tell you, just forget stressing about it and tell the agent what rate you want and leave them to sort it out. It takes two to tango and it sounds to me as though the client is just getting you to do something they'd rather not do.

He is suggesting he doesn't know my rate and hasn't specifically asked the agent what margin they are applying otherwise he could do the maths.

I do agree with you on approach.

I've told the agent my rate requirement and that I would expect them to review their margin if the client pushes back.

I've told the client I know the agent to be on a margin that is not competitive.

Its now up to them to deal with this. If I don't get my minimum requirement I will be professional, finish my contract and move on.

[Lucifer Box]

Just spoke to client. He doesn't know margin either!

What? That is complete bollox. How can your client not know what they are paying for your services? Do they just tell the agency to direct debit their bank account with whatever they think is fair?

If they won't tell you, just forget stressing about it and tell the agent what rate you want and leave them to sort it out. It takes two to tango and it sounds to me as though the client is just getting you to do something they'd rather not do.

[omen666]

Hmmm hold on - maths can come into play here - if you tell your boss what you get and he tells you what he pays out - I think unless maths has changed since I did gcse's that you have the margin.

If he's happy talking to you about the negotiations he had he should be happy to discuss the numbers too.

If he isn't then he isn't interested in you knowing the margin either cos it won't take a rocket scientist to derive this from your rate and the agnecy margin

Agreed, but it is one thing to discuss the 'framework' of the deal that went on and another to talk actual figures. There is a degree of trust in the working relationship, but he might actually being trying to squeeze both the agent and me, so it would be a leap of faith I guess

[Rebecca Loos]

no that doesn't help - if you have opted out then you can't go direct. Well that's one avenue closed, think of others.

[boredsenseless]

Hmmm hold on - maths can come into play here - if you tell your boss what you get and he tells you what he pays out - I think unless maths has changed since I did gcse's that you have the margin.

If he's happy talking to you about the negotiations he had he should be happy to discuss the numbers too.

If he isn't then he isn't interested in you knowing the margin either cos it won't take a rocket scientist to derive this from your rate and the agnecy margin

[omen666]

Have you considered going direct with the client? Would the client be happy with that? Have you opted out of the Regulations?

I have opted out...does that help? (apologies, last time I contracted the regs were not in place)

[omen666]

Just spoke to client. He doesn't know margin either!

I've told him my suspicisions...he thanked me, so I suggested he ask them direct. I told him that I was told he negotiated hard, he said he didn't question the rate. So I am positive this is the agent winning both ends.

We agreed he would demand their margin details and he would ask them to reduce it.

He also asked if there was another way around this....very leading....any ideas?

If we both squeeze the agent hard enough I think everyone should be happy, but are there any other 'avenues'