What to do - Contract Finishes tmrw

[Andy Hallett]

Hello

Need some advice my contract is due to finish tmrw and its been a good gig 15mnths+ - client likes my work and agency to date has been taking 22% of my day rate. They are not budging on this margin even though I came in on a initial 3 month contract. I may have another renewal on the cards but want to renegotiate my rate with agent... the client don't have the budget to up my rate and therefore was thinking the agency could. However they are unwilling to budge.

This is most dissapointing as there appears to be no flexibility on their front even though I have negotiated all renewals... I hardly ever hear from the agency unless the contract is coming to an end and they want a catch up. I am now thinking do I ditch the agency and look elsewhere as I am sick of the £100+ they are making off me everyday for doing very very little. I am having to do all the leg work and its frustrating.

To top it all off I have just discovered a colleague (contractor) is on more more money then me even though we do the same type of work. I am tired of being fleeced and I am happy to walk away but I will leave with very little handover and the project will suffer and ultimately the public who use the service. I hate the situation I am in.

Genuine question, what else should they be doing mid-contract for you?

[kingcook]

Genuine question, what else should they be doing mid-contract for you?

I don't know what OP expects from an agent mid-contract, but personally I don't expect anything. And there is the problem - why should an agency take £100/day from someone's daily rate?

Agent from previous contract was taking £100/day, for 12 months. Say approx 250 working days in the year, that's £25,000 he made out of me. Nice little earner for putting an advert on a few job websites, reading some CV's, making a few phonecalls, and drawing up a contract.

I guess whatever amount an agent takes, the contractor will always want it to be less though. From a contractors POV, the agent is just someone standing in the middle of the client and themselves taking a chunk of the pie whilst appearing not to do much.

[malvolio]

I don't know what OP expects from an agent mid-contract, but personally I don't expect anything. And there is the problem - why should an agency take £100/day from someone's daily rate?

Agent from previous contract was taking £100/day, for 12 months. Say approx 250 working days in the year, that's £25,000 he made out of me. Nice little earner for putting an advert on a few job websites, reading some CV's, making a few phonecalls, and drawing up a contract.

I guess whatever amount an agent takes, the contractor will always want it to be less though. From a contractors POV, the agent is just someone standing in the middle of the client and themselves taking a chunk of the pie whilst appearing not to do much.

Ah but, how much money did he spend on prospects that went nowhere? Agencies are happy if they can convert 10% of sales bids into final business.

Have you ever worked out much dead money an agency has at any one time? Assuming 100 contractors at £400 a day, it's around £1.2m a week. How much does it cost to have the money he pays you locked away not doing anyhing before he gets paid himself?

And have you not yet realised that he won the business, not you, and that you get a cut of his income, not the other way round?

If you're going to complain about it, at least try to understand the business model.

[kingcook]

Ah but, how much money did he spend on prospects that went nowhere? Agencies are happy if they can convert 10% of sales bids into final business.

Have you ever worked out much dead money an agency has at any one time? Assuming 100 contractors at £400 a day, it's around £1.2m a week. How much does it cost to have the money he pays you locked away not doing anyhing before he gets paid himself?

And have you not yet realised that he won the business, not you, and that you get a cut of his income, not the other way round?

If you're going to complain about it, at least try to understand the business model.

You have some good points there. I guess I just see an agency as one of those pointless careers, a bit like a traffic warden - everyone hates them but once you realise why they are there, it's a bit more bearable

[lukemg]

YMMV, my policy is this -
1. Make sure I can live with the rate on the way in.
2. I AM interested in the cut the agency gets as it might mean I can squeeze more out later, same goes for people in same job.
3. Usually suck it up for 9-12 months.
4. Without trying to justify I ask if the rate can be reviewed with a view to increasing when the renewal is offered (not after 3 months, see 1).

I have dug in very hard on 2 occasions when I was happy to leave, one time they coughed more, the other they asked me to reconsider then let me leave (I was taking the rip tho...).
Rest of the time, I have usually got a few percent, I consider 5 % reasonable, anything over is a nice bonus and adds up over the year.
I would not flounce from a decent place even if they said no, but might sulk and start looking.
Throughout all this - Make sure you maintain high standards at the client, you might need them to shout up for you although by preference the agency coughs and doesn't mention it (22% markup gives lots of room for this, 5% PSL does not, hence interest).
SO - THERE IS NO HARM IN ASKING after a decent time in the role as long as you are well regarded but don't cut nose to spite face if it goes against you.
Oh - and beware the agency trick of going away for a few days then saying sorry - client says there just isn't the budget (when they have not even spoken to them, they just hope you will drop it....)

[psychocandy]

Oh - and beware the agency trick of going away for a few days then saying sorry - client says there just isn't the budget (when they have not even spoken to them, they just hope you will drop it....)

Got this at the moment. Trying to agent to speak to client to get some sense out of them (and actually think about extension more than 1 day before end of contract) but its become obvious that agency hasn't bothered at all. Think this is because I have rolled over in the past and let them do it at short notice (last time even though I got an email from agency, client didnt sort PO until 3 weeks later).

This time my warnings that I'm going to insist on it being sorted in advance or I'm not going in seem to be ignored by agency. It seems they dont want to upset the client. We'll see what happens then.

[BolshieBastard]

Genuine question, what else should they be doing mid-contract for you?

How about what they used to do? Touch base, ask how things are going, come and take the people who are making money for you after the initial contact for a meal or something?

[VectraMan]

How about what they used to do? Touch base, ask how things are going, come and take the people who are making money for you after the initial contact for a meal or something?

I only once had an agent buy me lunch. He spent most of it telling me about his new Ferrari in a "what? You don't have one?" kind of way.

I think I'd rather be left alone.

What Mal says is absolutely right; people are all too quick to pick apart other people's business models without looking at the big picture. But, it has to be said, agents would be a lot less unpopular if they were more up front, and especially when it comes to renewals. All the renewals I've had have been nothing to do with the agent; I've arranged it with the client who then goes to call the agent. It's hard not to feel ripped off in those circumstances - I don't expect them to stop earning a fee but they could cut their fee at renewal time. An agent who did that, and made it public that he did that, would I'm sure be a less unpopular one amongst the likes of us.

[Scoobos]

WHS 100%

I buy all this - but I also think that the agents business model, over the years has been:

1. Oversell risks to clients of going direct
2. Take the rate for the deal, then take the rate for any continuing business.
3. Buy agents as cheaply as possible - no longer is anything more than a history at the carphone warehouse required, for the most prestigious agencies.
4. Mislead EVERYONE.

For me, this is why I think we're forced to use agents - I've been contracting a while now and know some (VERY) big multinationals that are sold the "preferred vendors" arrangement on hyperbole and crap from agencies.

The big agencies have made a very good job of sewing up the industry. Personally I think they are the single most risk to my business - not an enabler at all. Agents tend to have such poor knowledge that they represent you far worse than you could yourself - they make us look 20% more expensive and do absolutely nothing for that cash other than an initial sale.

Dead leads... sheesh.

[Scrag Meister]

22% seems high, especially after 15 months, call their bluff if you can afford to walk...

WKS, depends how daring your are. Would be nice to pull it off though.

On a previous contract I was told by the agent that they charged 12% for 2 years and 5% after that, which seems fairer