Reply to: How to negotiate rates when you're forced to go through an agency

[Scrag Meister]

Both of my last 2 contracts have been made directly.

Negotiations were all with the client and I got the rate I wanted, so I wasn't really that interested in what the agent was getting on top of that.

[tpsman]

I'm usually a good judge of character, and I've had nothing but good feelings from dealing with this agency. Maybe I'm naive!

[Wanderer]

The agency are telling me that they are on a fixed rate, and the client specifies the daily rate themselves. Am I being naive in believing the agent?

They may very well be telling the truth, I've had a few contracts where the agency is on a fixed margin but the bottom line is don't trust anything the agent says.

Talk to the client and find out what the score is. They may tell you to "talk to the pimp" or they may engage in negotiations with you directly, it varies from client to client. I make a point of going to the client direct rather than letting the agency drive the negotiations. Too many times agencies have ripped off both contractor and client....

[Dactylion]

Unless your contract tells you not to in which case you will be in breach.

Would such a clause be enforceable?

There are lots of clauses put in contracts that have very little basis in reality.
Don't they even often have the tacit admission something along the lines of "If any of the clauses in this contract are bulltulip then the rest of it still holds up...."

[DirtyDog]

Unless your contract tells you not to in which case you will be in breach.

Unlikely that there is a clause in the contract which says that you can't ask them whether they have a fixed rate agreement with the agency.

And if there is, then more fool you for signing it.

[northernladuk]

Ask the client.

Unless your contract tells you not to in which case you will be in breach.

[DirtyDog]

The agency are telling me that they are on a fixed rate, and the client specifies the daily rate themselves. Am I being naive in believing the agent?

The role was advertised at the same rate at multiple agencies, so I'm inclined to believe them.

Ask the client.

[Ticktock]

The agency are telling me that they are on a fixed rate, and the client specifies the daily rate themselves. Am I being naive in believing the agent?

The role was advertised at the same rate at multiple agencies, so I'm inclined to believe them.

Nope, sounds like it could be legit. One of my previous clients had the agency on fixed rate, and wanted to negotiate my rate directly (at extension, not the initial contract).

[tpsman]

The agency are telling me that they are on a fixed rate, and the client specifies the daily rate themselves. Am I being naive in believing the agent?

The role was advertised at the same rate at multiple agencies, so I'm inclined to believe them.

[masonryan]

@Kal

We obviously assess each business opportunity on it's own merits. A number of things we would consider on taking on pass-through business would centre around the credit wothiness of the client, payment terms and and the potential future business available.

The issue tends to be that once you get locked into low margin spot business it is very difficult to convert that into high volume and higher margin business. I accept your point that this is just an admin service.

In the position I am in I am seeing lots of companies stop expanding their traditional UK and Engineering operations to focus on high value sectors and less commoditised international markets.

Ultimately clients and contractors get the service level they pay for.

What?

[Andy Hallett]

@Kal

We obviously assess each business opportunity on it's own merits. A number of things we would consider on taking on pass-through business would centre around the credit wothiness of the client, payment terms and and the potential future business available.

The issue tends to be that once you get locked into low margin spot business it is very difficult to convert that into high volume and higher margin business. I accept your point that this is just an admin service.

In the position I am in I am seeing lots of companies stop expanding their traditional UK and Engineering operations to focus on high value sectors and less commoditised international markets.

Ultimately clients and contractors get the service level they pay for.

[masonryan]

Depends on the rate to some extent. 3% of squat is squat and won't be worth the agents time.

Oh really, then try getting the agent to sacrifice some of that 'squat'. Good luck with that.

[kal]

When looking at the sort of margins we are talking here it doesn't surprise me when you get a poor service or the agency goes pop.

So a contractor comes to you and says that for no effort on your part you get to earn £20-£50 a day for just a bit of admin (and a nice intro to a client that you have no hook into more than likely) and you consider that a waste of your time... jeez, no wonder I avoid you people like the plague

[Andy Hallett]

When looking at the sort of margins we are talking here it doesn't surprise me when you get a poor service or the agency goes pop.

[Wanderer]

3% of 350 a day is only £10.5 a day, over a 3 month contract it's £630. I can't see an agent getting out of bed for that tbh.

Oh yes they will - it means that they can build up a relationship with the client and potentially get other contractors in there. It's all business to them.

I've had a couple of contracts on 4 or 5% markup.