Reply to: How to outmanoeuvre during contract extension..??

[Darren_Test]

Update....

Client informed me they are renewing my contract, But no information from my outsourcer yet...!! I am not contacting them as I feel I will loose upperhand if I contact them & ask for renewed contract.

[The Wikir Man]

But I will never entertain working with that agency again until the next time they turn up with a decent rate and I take it

FTFY - you know that if they turned round with a decent rate and project, you'd take them up on it. Same way that agencies threaten a "black list" occasionally and then send you an email 2 weeks later with a new project.

[Pogle]

I'm in a similar position.

Hate to say it but we don't actually have any bargaining power.

Ask nicely - they'll laugh.

Threaten to walk - they'll say "walk". There are hundreds of replacements out there just snapping at your heels. Like me, you haven't been there long enough to be valuable enough.

The only choice we have is between whether it's better to stay, for the good of your CV, or go, and risk being out of work again for months.

I'm staying for now .............. but still looking.

Yep I was in a similar position last year, I was working in London, on one of my lowest rates ever and knew the agency were taking the pish - cos they could and i was desperate. At extension time the client said they only wanted me (- which was nice), and whilst they understood my unhappiness at my rate, did not want to get involved with making the agency increase it.
Basically one senior manager didn't want the hassle - fair enough.

so I told the agency I was going. The agent i was dealing with said they'd see what they could do, but her boss got in touch and said - no way jose. Take it or leave it!
In the end I had to shut up and put up. But I will never entertain working with that agency again and I kept my clientco manager up to date on what was going on, he was appalled by the agency's tactics and said they would never use them again.

I enjoyed the contract though and met some great people

[Wanderer]

I dont get this. What percentage of the clients rate do you expect to get? A typical consultancy day rate is say £1000. A permie consultant could expect to get between £200 and £250 of that. A contractor may get up to £500.

I would try and go direct and settle for 800/day. That way everyone is happy (except the middlemen - bad luck guys!)

[JoJoGabor]

I dont get this. What percentage of the clients rate do you expect to get? A typical consultancy day rate is say £1000. A permie consultant could expect to get between £200 and £250 of that. A contractor may get up to £500. If there are 3 companies in between that they are all taking a slice for their overheads.

I dont think its the same comparison to an individual contractor negotiating with an agent. The consultancy have done all the hard work training their consultants, paying for salesmen to win the business. You're just providing the end service here.

[SillyMilly]

I'm in a similar position.

Hate to say it but we don't actually have any bargaining power.

Ask nicely - they'll laugh.

Threaten to walk - they'll say "walk". There are hundreds of replacements out there just snapping at your heels. Like me, you haven't been there long enough to be valuable enough.

The only choice we have is between whether it's better to stay, for the good of your CV, or go, and risk being out of work again for months.

I'm staying for now .............. but still looking.

[doodab]

Give them all a massive kick up the arse. Far too many middle men, get them to sort their tulip out. Tell them you know how much the client is paying and that they can have 10% of that between them.

If they don't like it then they can fight it out , but it's bulltulip for them to be taking 150/day for doing SFA. At least 100 quid of that should be in your pocket not theirs.

Outsourcing deals are a bit more complex than "too many middlemen", often the entire IT operation or parts of it are outsourced on fixed cost deals for a number of years and for the winning bidder the profitability depends on the keeping within the projected costs. They will then fill niche / specialist roles that they don't have on their own books with contractors (often through an agency) or in some cases by outsourcing to another IT services firm.

You can word it however you like, at the end of the day you have to ask the people who pay your invoices for more money. If they decide you're not that important and they can get someone else for the same money rather than give you a rise, you probably aren't going to get one. The only bargaining chip you have is to leave, and in my experience if they are going to say yes they will say yes before it gets to that.

But feel free to phone your immediate clients customer and tell them they're a bunch of parasites. That will certainly help your case

[Wanderer]

Margins are generally a closely guarded secret.

Agencies would like you to think that but that's not a hard and fast rule. For most of my contracts the margin has been disclosed to me at some time or another.

Ultimately you have to talk to the last people in the chain

Give them all a massive kick up the arse. Far too many middle men, get them to sort their tulip out. Tell them you know how much the client is paying and that they can have 10% of that between them.

If they don't like it then they can fight it out , but it's bulltulip for them to be taking 150/day for doing SFA. At least 100 quid of that should be in your pocket not theirs.

[Worzel]

- Contract with an outsourcer through another outsourcer to an IT service company

Isn't IT great?! I wonder how much these suppliers are taking a out of your "real" chargeable rate in this situation?!

[Sausage Surprise]

I found out (through Client) that the agent was making £150 a day from me in a role I took last year. Upon the first renewal after 3 months I asked for a £25 a day increase - they refused saying "that is the going rate for the role".

I walked (fortunately into another role).

One of the top bods from the agency rang me to ask why I had refused the extension so I told him about my rate rise request. He went ballistic when he found out I had been turned down.

[Darren_Test]

Sorry to step in with a "downer" but - Client indicated TOP rate...

Maybe client isn't naive and is priming you for "you are not getting any more".

Obviously you have a few too many in the chain for your best interests (although its too late to change that).

You say you've got a rate that "just covers your costs" - Why?? You accepted it!!! - I would say you've got a rate that you were happy to accept when it was offered... now you have discovered you've been turned over - thats life I'm afraid.

You can now ask the company you have a contract with about an increase.... and hope for the best but (as stated above) your only real "weapon" is not to renew....

Good luck.....

Well..after sitting on bench for long I was even ready to pay some one to cover my CV gap, thats why I accepted. Also I never worked away from home so I was n't sure about all additional costs associated. I was also not aware that client was paying TOP rate, which came to light recently only.

[doodab]

That may give them time to find replacements. I am not trying to get more from client, what I need each intermediary to take cut in their margin.
So that I get a rate that covers my cost well at least. Client indicated TOP rate payment so there should be room for manoeuvre among the outsourcers.

Will I be able to force each party to reveal their margin..? If so how to do that..?

Margins are generally a closely guarded secret.

I doubt they will look to replace you just because you asked for a rise, the worst that will happen is that they'll say no.

Ultimately you have to talk to the last people in the chain and tell them you want a higher rate, and explain the reasons why (i.e. half market rate, working away from home, barely making ends meet). If you have a good enough case and they value you enough they will say yes. If they don't, it's because they think they can afford to loose you, so threatening to leave won't get you anywhere, all you can do is keep looking for something else.

[Drewster]

That may give them time to find replacements. I am not trying to get more from client, what I need each intermediary to take cut in their margin.
So that I get a rate that covers my cost well at least. Client indicated TOP rate payment so there should be room for manoeuvre among the outsourcers.

Will I be able to force each party to reveal their margin..? If so how to do that..?

Sorry to step in with a "downer" but - Client indicated TOP rate...

Maybe client isn't naive and is priming you for "you are not getting any more".

Obviously you have a few too many in the chain for your best interests (although its too late to change that).

You say you've got a rate that "just covers your costs" - Why?? You accepted it!!! - I would say you've got a rate that you were happy to accept when it was offered... now you have discovered you've been turned over - thats life I'm afraid.

You can now ask the company you have a contract with about an increase.... and hope for the best but (as stated above) your only real "weapon" is not to renew....

Good luck.....

[Darren_Test]

I generally bring it up as early in the renewal process as possible. I don't know if that's the best negotiating tactic or not, I just think it's better to be upfront and it gives me more time to line up a new contract (or find out I don't have a leg to stand on, depending on the market)

That may give them time to find replacements. I am not trying to get more from client, what I need each intermediary to take cut in their margin.
So that I get a rate that covers my cost well at least. Client indicated TOP rate payment so there should be room for manoeuvre among the outsourcers.

Will I be able to force each party to reveal their margin..? If so how to do that..?

[doodab]

Should I wait for contract letter for negotiation, which might happen only days b4 current contract end..? Is that going to be the best time to push them hard to get better rate ..?

I generally bring it up as early in the renewal process as possible. I don't know if that's the best negotiating tactic or not, I just think it's better to be upfront and it gives me more time to line up a new contract (or find out I don't have a leg to stand on, depending on the market)