An agent - how we negotiate with contractors
Agent Calling
Hello all.
I’m new to this board.
I actually am a recruitment consultant, and although I don't work in IT I deal with these sort of issues daily!
It is true that I will aim for the highest margin and the only reason I would pay someone more than the minimum they give me is if I think they will walk away otherwise.
Now, from the point of view of building a good relationship with candidates you don't want a tooth and nail fight for every last £1 per hour, so the typical scenario is more like this:
Usual Scenario
Client wants candidate and is prepared to pay £1200 but would like to pay less.
Candidate likes role and could just about do £700 but wants more.
The more savvy candidates will say something like "I'll have to think about it you know, the rate is much lower than I wanted."
At which point the recruitment consultant will most likely say "I could go back to the client and see if we can get something more out of them."
(I edited out the standard attempt to convince candidate he is pricing himself out of the market...)
In reality, with a £500 margin, he can go have a coffee, phone you back and give you £800.
Clients
By the same token clients (though usually less prone to last minute jitters due to clearer mandates/budget) do sometimes try and squeeze at the last minute.
Negotiating a big margin in the first instance allows slack for this to happen without breaking the deal.
The same applies if you phone your consultant while working through him and tell him that you're considering leaving as you have the chance of much better money elsewhere.
If I can say with confidence right away that I can increase someone's rate, then hopefully recoup the loss from the client, it is so much better than phoning around furiously trying to maintain a slim margin.
Many candidates are not at all averse to playing hardball like this and if you have to keep phoning up the company and asking for more money then it can jeopordise an otherwise good deal.
Investing Time
Taking a bigger margin also makes it more viable to invest time in the deal, finding the right job for the candidate, or the right candidate for a job. High street admin agencies can work on tiny margins because they get candidates walking in all day looking for jobs and clients phoning up all day looking for staff.
They can place someone with about 20 minutes of phone calls, and on the basis of nothing but a quick chat, and just possibly a reference. In professional/technical recruitment you often have to get to know your candidates and clients, and spend a considerable amount of time making the right match.
Finally, we all like money!
Anyone who has ever moved jobs for better money or asked for a pay rise with the implicit threat that you would leave otherwise has basically been their own recruitment agent, with the same motivation as those who do it for a living.
This article originally appeared on the British contractor's website IT Contractor.
Anonymous
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Re: PARASITES M, as pointed out in this forum, the majority of IT recruitment agencies in Australia no longer get high commission's for IT contract work. This isn't to say that occasionally they do try for high comissions. They do! The Australian IT industry has, thankfully, risen to a level of maturity where they organize recruitment processes through agencies and demand transparency from the agency's. I shouldn't doubt that recruitment agencies are making a killer commission in other areas of Australia's employment sectors. But it is now "less so" in IT, and probably "more so" in other Industry sectors. However in the past is was the reverse. The reality is that the IT sector has not just been about future technology - Australia's IT industry has unwittingly become a playground for ideas on future employer/employee relationships within Australia under Howards rule. I can say from an "IT worker" perspective, it sucks! D, 10/12/2007 12:01:52 AM
[b]PARASITES[/b]£500 (guess thats per day ?) for the agent for doing basically a few phone calls and faxes. When you work that out over months, no wonder theres a skills shortage !!! Developers spend YEARS and YEARS learning highly technical ever changing skills, and agents think they're entitled to take 20-50% of their pay for themselves doing comparitevly NOTHING. And have the arrogance to think they deserve it. What a mugs game. GREEDY AGENTS are killing IT contracting. m, 10/12/2007 03:59:10 AM
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