Minimum agency percentages?

[DodgyAgent]

I'd guess that's not so easy. If you think it is, start with keeping 1 contractor in work: yourself.

Also, if you are an agent but you work for an agency rather than completely on your own, who do you think makes the most money for the least work? I'd say the agency, not the agent.

I think as soon as you start trying to measure what people do for their money then you are playing an irrelevant game. In my view the best margin is whatever you manage to negotiate. Also bear in mind that if you want the margin to go down then who is to say that the client should not get a discount rather than you get a raise?

[Ignis Fatuus]

I think I should become an agent. Keep 6 people in work and make a 6 figure salary from the beach!

I'd guess that's not so easy. If you think it is, start with keeping 1 contractor in work: yourself.

Also, if you are an agent but you work for an agency rather than completely on your own, who do you think makes the most money for the least work? I'd say the agency, not the agent.

[d000hg]

I've got one so far but that's a sub-contractor and it makes me only £40/day. Just need another 9...

[kingcook]

I think I should become an agent. Keep 6 people in work and make a 6 figure salary from the beach!

I've often wondered why I don't do this myself.

[d000hg]

I think I should become an agent. Keep 6 people in work and make a 6 figure salary from the beach!

[mudskipper]

15% here. Agency wouldn't budge - even for a year's extension.

[yetanotherbob]

The last agency I worked with was decent. Very upfront about their 10% margin.

[kingcook]

It's not just the %age, it the amount too. A bit of a low example I know, but say an agent managed to pay someone £50/day, and the client paid the agency £75/day. That's a 33.33% margin (or 50% mark up) which is a big percentage, but is still peanuts.

[Wanderer]

My current agency is taking about 7% of the contract value - they are on a PSL and the client told them that they were getting a fixed margin rather than ripping off contractors for whatever they could take them for.

[speling bee]

My agent is on 5%. I found the gig and agreed the rate and they just payroll. My daily rate ends in 73p.

[d000hg]

13% as a minimum is extortionate in my book.

[Ignis Fatuus]

Ah, It's lucky I'm not marketing my self as a "Forum googler" then as I failed miserably.

13% Bah. I'll be off then!

[edit] that's becuase the agent 2 did nothing in this case. A colleague from a previous gig phoned me as he'd just started somewhere new, said am I free. I said yes, so he said get you CV into agency 2 then as they are doing the recruiting. If only he'd been there longer and worked out agency 1 were lead supplier I'd now be on £380 a day instead of £330! that's why I think 13% is too much.

That's the really sad bit. I don't mind that an agency makes a profit out of matching clients and contractors, but it always seems like an unnecessary cost when one agency matches client to another agency and the second agency matches first agency to contractor. Why does it take 2 agencies?

I understand that clients use agencies, not so much to find resources as to filter them and organise payment etc. But why does the tier 1 agency not find resources themselves? My CV has been on the web for more than 10 years and pops up high up on the first page of google.co.uk with any reasonable search string for a contractor cv in my field. Really, anybody who can't find me themselves has not looked.

As I say, I can imagine that clients actually want an agency between them and me: but why would an agency want another agency in between? Because they can, I suppose: the cost of the tier 2 agency comes out of my money, not theirs.

[IR35FanClub]

Ah, It's lucky I'm not marketing my self as a "Forum googler" then as I failed miserably.

13% Bah. I'll be off then!

[edit] that's becuase the agent 2 did nothing in this case. A colleague from a previous gig phoned me as he'd just started somewhere new, said am I free. I said yes, so he said get you CV into agency 2 then as they are doing the recruiting. If only he'd been there longer and worked out agency 1 were lead supplier I'd now be on £380 a day instead of £330! that's why I think 13% is too much.

[northernladuk]

Oh look

agency percentage site:forums.contractoruk.com/business-contracts - Google Search

Would you believe it.

I think a couple of agents have posted here in the past and the lowest they are willing to go seems to be around 13% which is what the agents who are on fixed cost type agreements with clients are on as well we are told.

[IR35FanClub]

So what is a realistic figure that an agency will accept as their minimum fee - % or £ value?

Been doing some searching so before anyone jumps on me - I have read some threads and besides I've got some specific numbers...

I'm currently on £330 a day - despite me telling the agent I wanted £360, but I took it as I can get home in less than an hour.

Since starting 6 months ago I've found the role isn't pure tech - it's part manamgement too. Which is fine - if the fee is rgiht.
We've also interviewed 20 odd permies to back fill me with no success.
Client now want to extend for 6 months as there's a big project coming up.

I've since found that the client is paying £400 to agency 1 - the main resource supplier, who take 5%.
Agency 2 who I'm contracted with therefore get £380 and keep £50. Which is just over 13%

So they get over £1k a month for processing one invoice. In my book that's too much. Argos manage to sell me 5 widgets for £8, have pre bought the stock and people have to walk about to fulfil my order and still have to update their accounting and stock control systems.

So I'm looking to get as much as possible - but what is the minimum people have found that agencies will take? Ideally I'd like to pay them about £50 a month max, but know that won't fly.

5% seem to be the figure that other posts have mentioned - but how did you get them to there?

Do you do a Jerry Macguire and shout "show me the money" down the phone at them?
Do you let on you know their margin (or save that for later in the discussions).
Do you point to other similar roles?
Do you get in a strop, threaten to walk and they'll get 13% of 0? I have enough war chest to chance it, no need to work till June 2013 :-)

I know they'll try and dig in, but I want them to understand - a) they are not the only agency recruiting, b) they can't find staff anyway, c) I am serious about walking - I have two other businesses that could do with some time on them to increase their income. I'm really staying contracting to build up my warchest for a little bit more security in the long run, when I decide to focus on them full time.

I think my ideal solution would be both agents getting no more than 5% ie £20/day each (still too much), but that would give me the £360 I feel is a fair value for the role and skills. More importantly its an extra £3,900 for me over 26 weeks! They get £400 each per month to try and find other people jobs based on my efforts at client co. There's no service to me or the client co.

Is this a realistic expectation?