Agency Margins Agency Margins - Page 2
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Thread: Agency Margins

  1. #11

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    You don't mention what percentage but lets assume 600 quid a day, that's about 15% or so percent which isn't out of the ball part. An agency supplying a lot of contractors to a client with lower margins could be on anything from 5 or 6% fixed up to maybe 10 tops, possibly with sliding scale.
    A smaller agency with just one or two contractors is going to have to charge more to cover their time so could easily push up to 20% for first engagement. That top end is bordering on piss take but it depends if they will drop it drastically after the first extension. They've got to make their profit on the gig in three months, anything after that is a bonus. If they are charging you around 15% but are willing to come down to 10% or lower at renewal then it's not really as bad as it seems.

    Depends on how eager you are for the work and how much you are getting in your pocket. I wouldn't, in this market, be getting overly hung up over a cut like this as long as I can reduce it at renewal.
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  2. #12

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    As said above, I couldn't give a monkey's about the agency cut as long as I'm happy with my rate.

    If my client started making noises about me being an expensive resource, then I would start asking questions to make sure they're not being stiffed.

  3. #13

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    Quote Originally Posted by Anubis View Post
    So long as you end up with what you are happy with why worry about any other parties.

    If your agency gets £100 each day but you also end up with what you wanted then everyone wins. Looking at the agency thinking "...but that's not fair. I could've got more!" isn't the right way of thinking.

    You charge £X per day. If someone is happy to pay that then everything else shouldn't matter (it's their business).
    Twaddle. If you're on £300 a day, and the agency is charging £400, then it's you who gets the push if things get difficult financially, not the guy on £300 a day and the agency charging £350.

    Furthermore, excepting factoring invoices, there's not much difference in overhead between £500 a day contract and a £1000 a day contract. Supermarkets survive on narrow profit margins because the absolute value of profits is huge.
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  4. #14

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    Agency want to pay me £400/day, & are charging the client £510.
    I raised the point at interview with the client who kindly shared their rate parameters, as provided to agency. They weren't aware of what the agency had advertised the role at, as no rate was indicated on the advert. They looked at little puzzled/bemused. Today I have radio silence. Not sure if I've stirred up a hornets nest.
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  5. #15

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    Quote Originally Posted by SteelyDan View Post
    Agency want to pay me £400/day, & are charging the client £510.
    I raised the point at interview with the client who kindly shared their rate parameters, as provided to agency. They weren't aware of what the agency had advertised the role at, as no rate was indicated on the advert. They looked at little puzzled/bemused. Today I have radio silence. Not sure if I've stirred up a hornets nest.
    No doubt they were hoping for someone the calibre of a 450pd person and not you.

    In all seriousness, I've never spoken about rate at an interview, it's what I leave to the agency. If I'm happy with the rate, then what they get from the client is their business and the client's stupidity for paying far more than they should/could. As a hiring manager, I'd typically I'd expect a rate for the agency of 12-15% or a sliding scale based on extensions, but it's up to the client to negotiate that deal.

    The biggest problem the pimp faces is if the clients is getting peed off with the contractor and exclaims "I can't believe I'm paying 600 a day for you" and the contractor replies "but I'm only on 300"...
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  6. #16

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    Quote Originally Posted by SteelyDan View Post
    Agency want to pay me £400/day, & are charging the client £510.
    I raised the point at interview with the client who kindly shared their rate parameters, as provided to agency. They weren't aware of what the agency had advertised the role at, as no rate was indicated on the advert. They looked at little puzzled/bemused. Today I have radio silence. Not sure if I've stirred up a hornets nest.
    I'm getting radio silence on lots of roles today, even on ones that I never brought up the agency margin.

    For what it's worth, I completely ignore the agency margin and focus exclusively on my daily rate.

  7. #17

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    Quote Originally Posted by hairymouse View Post
    For what it's worth, I completely ignore the agency margin and focus exclusively on my daily rate.
    Yep I get that, but when I ask for a higher rate than advertised, & they tell me the client won't pay a higher rate, but I know the agency margin & I can see that there's scope, then that pi55es me off. What that means is 'you're not having any of my cut'. Even if they'd have thrown in another £50/day, they would still have been making £60/day on it.
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  8. #18

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    Quote Originally Posted by SteelyDan View Post
    Yep I get that, but when I ask for a higher rate than advertised, & they tell me the client won't pay a higher rate, but I know the agency margin & I can see that there's scope, then that pi55es me off. What that means is 'you're not having any of my cut'. Even if they'd have thrown in another £50/day, they would still have been making £60/day on it.
    Totally agree with this. Yes, there's a cost to the agency associated with finding the client a contractor & that's fine, but beyond the first couple of months of billing they're basically charging money for nothing.

    I've also had agents mention a rate to me & then when I say it's fine they've said 'oh wait, I made a mistake - it's actually £50 less & the client is pretty fixed on that'
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  9. #19

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    Quote Originally Posted by KinooOrKinog View Post
    ....I've also had agents mention a rate to me & then when I say it's fine they've said 'oh wait, I made a mistake - it's actually £50 less & the client is pretty fixed on that'
    If I get that kind of response, it's usually followed by "Click ... whirrrrr"

    I know of one Financial company that pays the agency a fixed rate of "contractor rate+£50" per day per contactor - doesn't matter whether the contractor is on £100 or £1,000. For hiring DBAs this is fine, but when it comes to 1st line SD staff it creates a problem ...

  10. #20

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    so for Sports Direct staff it's £90 per day total cost?
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