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

[scooterscot]

??

The client pays 125% of my day or hourly rate to the agency.

[d000hg]

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

Hard to see how they don't make a loss, I know it costs me more than that for my subcontractors.

[Scrag Meister]

Thanks, Scrag Meister.
My friend's agency takes 13% out of 430 while my agency takes 20.5% out of 440. I am not in London but she is. Is it because london's margin is lower than everywhere else?

Could be, IMHO, because there are so many more contracting jobs in the smoke that they are happy to drop the rate because they are likely to place a lot more contractors.

i.e. They place 2 @ 10% in London, but would only be likely to place 1 @20% in Aberystwyth or somewhere equally remote.

[7of9]

Sorry - didn't mean to imply that £40 wasn't a lot for me. For me, one of the most important things is whether I enjoy the work and whether I like the client. If I do, then arguing for a further rate increase from 15% (assuming that this is what they have now offered) to 11% wouldn't make too much difference.

I think you are putting too much emphasis on what other agencies charge and the impact of that - if you agree a rate that you are happy with, then a comparison of 15% to 13% commission to the agent shouldn't really bother you (it doesn't me). I've never asked an agent what percentage they are on (two told me without being prompted), because I don't care what they take - I fix a rate that I want for that role.

It's always worth discussing it further with the agent, but don't be too surprised if it ends up as a "take it or leave it" offer at 15%. Don't make any threats that you aren't prepared to carry out, though.

Thanks for the input, TheFaQQer!

[TheFaQQer]

Thanks TheFaQQer, 40 pounds extra a day is a lot of money for me. maybe not for you 15% (90 per day) on renewal is not too unrealistic, but still unrealistic knowing my friend only got charged 13% for the first 6 months.

Sorry - didn't mean to imply that £40 wasn't a lot for me. For me, one of the most important things is whether I enjoy the work and whether I like the client. If I do, then arguing for a further rate increase from 15% (assuming that this is what they have now offered) to 11% wouldn't make too much difference.

I think you are putting too much emphasis on what other agencies charge and the impact of that - if you agree a rate that you are happy with, then a comparison of 15% to 13% commission to the agent shouldn't really bother you (it doesn't me). I've never asked an agent what percentage they are on (two told me without being prompted), because I don't care what they take - I fix a rate that I want for that role.

It's always worth discussing it further with the agent, but don't be too surprised if it ends up as a "take it or leave it" offer at 15%. Don't make any threats that you aren't prepared to carry out, though.

[7of9]

If you are friendly with the client, why not speak to them as well to see if there is any more money available on there side.

15% is not unreasonable. Depends on the industry too, as banks pay high and the agent are happy to take a smaller %age.

Thanks, Scrag Meister.
My friend's agency takes 13% out of 430 while my agency takes 20.5% out of 440. I am not in London but she is. Is it because london's margin is lower than everywhere else?

[Scrag Meister]

If you are friendly with the client, why not speak to them as well to see if there is any more money available on there side.

15% is not unreasonable. Depends on the industry too, as banks pay high and the agent are happy to take a smaller %age.

[7of9]

My default assumption. 125%.

??

[7of9]

If you like the client and you like the rate, then renew.

If you like the client and you don't like the rate, then negotiate for a better rate - either from the agency reducing their margin, the client stumping up more cash, or both.

If you don't like the client and you like the rate then renew, but look for other options.

If you don't like the client and you don't like the rate, then leave.

Is the extra £40 a day (20.5% margin down to 11%) going to sway you one way or the other? If you're not swayed, then there's no point in wasting anyone's time. A 15% margin isn't too unrealistic, to be honest.

Thanks TheFaQQer, 40 pounds extra a day is a lot of money for me. maybe not for you 15% (90 per day) on renewal is not too unrealistic, but still unrealistic knowing my friend only got charged 13% for the first 6 months.

[scooterscot]

My default assumption. 125%.

[TheFaQQer]

Thank you all for the help so far.

So I was annoyed that my agency refused to tell the rate they got from my client and planed to jump the ship(an offer in London).

Today the agent called and told me the client pays 440 and they have been taken 20.5% for my current contract. That is 90 pounds per day.
He tried to convince me to accept the renewal offer, which is 15% margin, they get 66 pounds per day.

I would like to walk away but my client has treated me really well and I got to do whatever I want here.

The chance of my agent to find the replacement is really low, as my manager doesn’t really like them + it’s hard to find someone with my experience.
I am really not happy they are taking 20.5% to be honest as my other contractor friends’ agency only take 13% for the first contract.

Shall I negotiate the margin to 11% meaning they still get more than 50 pounds per day. Or shall I just walk away?

Any advice and suggestion will be greatly appreciated.

ps, i really like my client and its going to be a long term contract.

If you like the client and you like the rate, then renew.

If you like the client and you don't like the rate, then negotiate for a better rate - either from the agency reducing their margin, the client stumping up more cash, or both.

If you don't like the client and you like the rate then renew, but look for other options.

If you don't like the client and you don't like the rate, then leave.

Is the extra £40 a day (20.5% margin down to 11%) going to sway you one way or the other? If you're not swayed, then there's no point in wasting anyone's time. A 15% margin isn't too unrealistic, to be honest.

[7of9]

Thank you all for the help so far.

So I was annoyed that my agency refused to tell the rate they got from my client and planed to jump the ship(an offer in London).

Today the agent called and told me the client pays 440 and they have been taken 20.5% for my current contract. That is 90 pounds per day.
He tried to convince me to accept the renewal offer, which is 15% margin, they get 66 pounds per day.

I would like to walk away but my client has treated me really well and I got to do whatever I want here.

The chance of my agent to find the replacement is really low, as my manager doesn’t really like them + it’s hard to find someone with my experience.
I am really not happy they are taking 20.5% to be honest as my other contractor friends’ agency only take 13% for the first contract.

Shall I negotiate the margin to 11% meaning they still get more than 50 pounds per day. Or shall I just walk away?

Any advice and suggestion will be greatly appreciated.

ps, i really like my client and its going to be a long term contract.

[Wanderer]

Right. First things first - there's no argument here - there is no "supposed to be" when it comes to margin.

Umm, quite often there is. My last few clients have negotiated a fixed percentage margin with the agency and in this case the agent shouldn't be trying to take more than that from the contractor.

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.....

That's definitely "the agent's view". I've done plenty of work where the agent's margin has been reviewed at renewal time, deemed to be is "too much" so it got cut to get me a pay rise at renewal time.

Can I request the agency to change my agent? I know one of the agents working there and he is a lot better.

You can ask, but the agency doesn't give a toss about contractors. If the client were to ask then that would be a different story. Don't be afraid to tell the client if the agency is dicking you about. More and more I'm finding that they are happy to put the boot in to agencies to keep the agents in line and I don't accept the "divide and conquer" bulltulip from agents saying I'm not allowed to negotiate directly with clients.

[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.

[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