Reply to: Switching agents mid contract

[Spacecadet]

The thing with rates is that the agency has to weigh up a few different factors.
Assuming an agent is working on a flexible margin, i.e. they have fixed a price with the client and they now need to find the cheapest resource to fill that gap. However they still haven't closed that sale untill they have found a contractor who is accepted by the client.
The agent has to balance the reward of getting a high margin against the risk of the client having to go elsewhere because all the contractors sent for interview have been crap. For the agent the perfect contractor is a very strong candidate who doesn't know it and will settle for £50-100 less per day than they should be getting.
At the other end is a crap candidate who thinks they are owed the moon on a stick for simply turning up in the morning.

As a contractor it helps to know where your skills and CV sit within the market. Are you going to be an easy sell for the agent or is he risking his reputation and a potential sale by sending you over? The answer to this will help determine what margin the agent is willing to sacrifice.

[TheFaQQer]

Really? So if you are being paid £600 a day, you dont mind the agency charging £1000? Personally Ive never worked via an agency, but I assume one day I will.

Not really, no.

[escapeUK]

Most don't know / care what the agency mark-up is. If I agree a rate that I'm happy with, then I don't care what the client is paying. Have a search for similar discussions - it comes up fairly frequently.

Typically, those on a lower rate are desperate to find out; those on a higher rate don't care.

Really? So if you are being paid £600 a day, you dont mind the agency charging £1000? Personally Ive never worked via an agency, but I assume one day I will.

[Wanderer]

yes i mean the client. the agency told me they get told by the clients what the mark-up should be. but how did people find out what the mark-up was? i asked the agent and was told it's confidential and that after a year the agency doesn't make any money at all etc, etc and after a rate cut, how can you get your original rate back?

Some clients dictate to the agencies how much margin they can take, my current one does and so do others that I have dealt with.
Sometimes the agency tries to pull a fast one by paying the contractor even less and keeping the balance for themselves.

If the agency won't tell you what margin they are on then it's probably because it's substantial. Talk to the client and find out how much they are paying the agency. The agent should have cut their margin to 7-10% of if you've been there for a year.

If the agency ever tell you that you are taking a rate cut then talk to the client about it and find out what the story is. Don't bother negotiating with the agency - they are generally useless.

[MarillionFan]

can you switch agents mid contract and stay with the same client?

I really like where i work, i can't stand the useless agency i'm with

Yes. You need a lot of salt but eventually the 1st agent will let go.

[TheFaQQer]

thank you all for the great advice. the good news is the client is happy to renew for another year in february by which time i hope to be in a good negotiating stage with the useless agent. if agents are pimps then i won't take their cr@p lying down - pardon the pun :-)

Not knowing how long you have been working in the same geographic location, you might want to read up on the 24-month rule.

Which might give you some clout when dealing with the agency.

[northernladuk]

thank you all for the great advice. the good news is the client is happy to renew for another year in february by which time i hope to be in a good negotiating stage with the useless agent. if agents are pimps then i won't take their cr@p lying down - pardon the pun :-)

That's the spirit. Remember this is a business to business negotiation, not someone selling something in a shop. Just a word of warning, it is likely they are much more experienced than you (and me) and have had the old 'I will walk off site' etc many times so empty threats won't work. They know you need them as much as they need you. Funny thing is you often get better deals from when you leave because you want to leave if you get my meaning. It is obvious it is genuine.

Remember to read up on the 24 month rule and if you are not aware of it, IR35.

[LondonGirl]

What do you mean move to a better team? Same agency+ client just different contract role?



Fixed term contracts are a completely different ball game. You are effectively employed with no benefits. It isn't the same as being a supplier contracted to a client.

You need to apply a bit of nouse here. Think about how you would run a business. If you introduced someone to a company and then 6 months later you stopped making any money out of them you would be agrieved. They introduced you, they have dibs on you. Rightly or wrongly that is the way agents work.



Companies is who?? You need to get your terminolgy right? You mean your client. In some cases on larger accounts there is an agreed mark up, around 12-15% from what is said on here. If this agreement isn't in place then they do not dictate anything. They give the agent (for example) £600 a day for a role, it is then up to the agent what he gives you. If you are dumb enough to accept £250 then happy days for the agent. people on here have admitted to their agents taking over 150% of their rate before now. It is up to you to negotiate. If the client wants you you are in a strong position to negotiate. This is where experience comes in to it though, knowing your skills, the markets the client etc.

Agents are salespeople (we call them pimps on here). They will do anything to close a sale and unfortunately this includes out right lying. If it is a big account it is possible they have a fixed markup but believe me they will try that one on you to get out of giving up some of their cash. You just have to make sure you are happy with the rate you are on.

People don't often find what the markup is, it is none of their business. The few that find out (paperwork on printer is most normal way) tend to get pretty upset and could possibly ruin the gig for them if they can't get over the anger issues. Discussing rates with other contractors is also another way to ruin a gig for yourself. One day you are happy, next you find the idiot next to you is on £50 a day more. it will eat you alive so best not to know. There is a thread on here asking who discusses rates and it is pretty universal you keep this to yourself. It is your business and yours only, just like the mark up is to an agent.

Getting your rate back is just about negotiation and threatening walk. Sometimes works, sometimes doesn't. Just have to make sure you are happy. If you are not you go, if you are you stay happy in your ignorance of the agents cut I am afraid. Have a look at similar contracts and compare rates, if you are 10% or more less than average then demand more or walk when renewal comes. You are now an asset to the client so hold some position power of the agent. 100% of nothing is still nothing to him so he has to take some notice.

thank you all for the great advice. the good news is the client is happy to renew for another year in february by which time i hope to be in a good negotiating stage with the useless agent. if agents are pimps then i won't take their cr@p lying down - pardon the pun :-)

[northernladuk]

yes i mean the client. the agency told me they get told by the clients what the mark-up should be. but how did people find out what the mark-up was? i asked the agent and was told it's confidential and that after a year the agency doesn't make any money at all etc, etc and after a rate cut, how can you get your original rate back?

Agents are salespeople (we call them pimps on here). They will do anything to close a sale and unfortunately this includes out right lying. If it is a big account it is possible they have a fixed markup but believe me they will try that one on you to get out of giving up some of their cash. You just have to make sure you are happy with the rate you are on.

People don't often find what the markup is, it is none of their business. The few that find out (paperwork on printer is most normal way) tend to get pretty upset and could possibly ruin the gig for them if they can't get over the anger issues. Discussing rates with other contractors is also another way to ruin a gig for yourself. One day you are happy, next you find the idiot next to you is on £50 a day more. it will eat you alive so best not to know. There is a thread on here asking who discusses rates and it is pretty universal you keep this to yourself. It is your business and yours only, just like the mark up is to an agent.

Getting your rate back is just about negotiation and threatening walk. Sometimes works, sometimes doesn't. Just have to make sure you are happy. If you are not you go, if you are you stay happy in your ignorance of the agents cut I am afraid. Have a look at similar contracts and compare rates, if you are 10% or more less than average then demand more or walk when renewal comes. You are now an asset to the client so hold some position power of the agent. 100% of nothing is still nothing to him so he has to take some notice.

[TheFaQQer]

the agency told me they get told by the clients what the mark-up should be. but how did people find out what the mark-up was?

Most don't know / care what the agency mark-up is. If I agree a rate that I'm happy with, then I don't care what the client is paying. Have a search for similar discussions - it comes up fairly frequently.

Typically, those on a lower rate are desperate to find out; those on a higher rate don't care.

If it's fixed by the client, then you could always ask them.

i asked the agent and was told it's confidential and that after a year the agency doesn't make any money at all etc, etc

I find that hard to believe - that implies that the longer you are there, the client cuts the rate that they are paying the agency. Again, you could ask the client to see if that's true.

and after a rate cut, how can you get your original rate back?

You probably won't. Only by doing something exceptional, or taking on a slightly different role which warrants a better rate would you be able to justify it if the client cares enough to entertain the idea. If you become essential to the project / client, then you might be able to get a better rate (but if you were that essential, then they probably wouldn't have cut your rate, would they?)

[LondonGirl]

What do you mean move to a better team? Same agency+ client just different contract role?



Fixed term contracts are a completely different ball game. You are effectively employed with no benefits. It isn't the same as being a supplier contracted to a client.

You need to apply a bit of nouse here. Think about how you would run a business. If you introduced someone to a company and then 6 months later you stopped making any money out of them you would be agrieved. They introduced you, they have dibs on you. Rightly or wrongly that is the way agents work.



Companies is who?? You need to get your terminolgy right? You mean your client. In some cases on larger accounts there is an agreed mark up, around 12-15% from what is said on here. If this agreement isn't in place then they do not dictate anything. They give the agent (for example) £600 a day for a role, it is then up to the agent what he gives you. If you are dumb enough to accept £250 then happy days for the agent. people on here have admitted to their agents taking over 150% of their rate before now. It is up to you to negotiate. If the client wants you you are in a strong position to negotiate. This is where experience comes in to it though, knowing your skills, the markets the client etc.

yes i mean the client. the agency told me they get told by the clients what the mark-up should be. but how did people find out what the mark-up was? i asked the agent and was told it's confidential and that after a year the agency doesn't make any money at all etc, etc and after a rate cut, how can you get your original rate back?

[TheFaQQer]

This is very true but funnily enough the only time I have ever been in anything like this is when the client initiated a move for me to go from agent to supplier (similar to the other thread) but it all went super smooth so assumed that one can be bucked in the name of future business a lot easier. Different situation as the client drove my move.

When I was working for a consultancy (permie), the client sounded me out about going direct as a contractor. And then found out that they had a handcuffs clause, which they had insisted the consultancy put in there.

The good thing was that I was at least aware that my employer didn't always put it in as routine

[northernladuk]

I went via my current agent for my first role with this company, i had a contract extension after 3 months but the opportunity to move into a better team arose and took it.

What do you mean move to a better team? Same agency+ client just different contract role?

i could have done a 'fixed term' directly with the client but i chose to go via the agent (i now regret this). As i see it they didn't find my current role i did this myself so when this contract expires, why can't i choose another agency?

Fixed term contracts are a completely different ball game. You are effectively employed with no benefits. It isn't the same as being a supplier contracted to a client.

You need to apply a bit of nouse here. Think about how you would run a business. If you introduced someone to a company and then 6 months later you stopped making any money out of them you would be agrieved. They introduced you, they have dibs on you. Rightly or wrongly that is the way agents work.

sorry i'm new to contracting after being perm for 10 years. and is it also true that companies dictate the amt of commission the agents take out?

Companies is who?? You need to get your terminolgy right? You mean your client. In some cases on larger accounts there is an agreed mark up, around 12-15% from what is said on here. If this agreement isn't in place then they do not dictate anything. They give the agent (for example) £600 a day for a role, it is then up to the agent what he gives you. If you are dumb enough to accept £250 then happy days for the agent. people on here have admitted to their agents taking over 150% of their rate before now. It is up to you to negotiate. If the client wants you you are in a strong position to negotiate. This is where experience comes in to it though, knowing your skills, the markets the client etc.

[northernladuk]

I'd suspect that there is a clause between client and agency which is even more restrictive than the one between supplier and agency.

This is very true but funnily enough the only time I have ever been in anything like this is when the client initiated a move for me to go from agent to supplier (similar to the other thread) but it all went super smooth so assumed that one can be bucked in the name of future business a lot easier. Different situation as the client drove my move.

[TheFaQQer]

As i see it they didn't find my current role i did this myself so when this contract expires, why can't i choose another agency?

Because you had a contract with the first agency, which in all likelihood prevents you from doing this. Alternatively / additionally, the contract between the agency and the client will have a similar (or even more restrictive) clause in it.

is it also true that companies dictate the amt of commission the agents take out?

No.

Either the client said to the agent "find me someone, and you get x% margin" or they said "find me someone - your budget is £x a day". Under the first, the more expensive the contractor, the better for the agency because they get more money. Under the second, the cheapest the contractor, the better for the agency because they keep what doesn't get paid to the contractor.

It's probably worth reading the First Timers Guide on the right hand side. Also, join the PCG and read their guides.

And welcome