RE: The age-old markup question, with a twist

["Lauren" <lt34 -at- csus -dot- edu>]

Do you mean like employment placement mark-up?  For my lovely town of
Sacramento, it seems to have averaged at 40% for W-2 employees and 33% for
Corp-to-Corp.  Agencies get paid like lawyers, but without actually having
to do very much work.  Lawyers tend to get 33% for litigation that settles
and 40% for litigation that requires a court appearance.  During the
dot-bomb era, some agencies would take 75% according to some of the
employees that discovered the mark-up and talked about it.

Both companies that require temporary employees and employees have become
very disgruntled by inconsistent mark-ups because a company could pay Agency
A $100 an hour and receive a $50 per hour employee or pay Agency B $80 per
hour and receive a $53 per hour employee.  The company may have the mindset
that it will pay *any* cost to get the best employee and the agency will
find the employee that meets the requirements but provides the best
profit-marging for the agency.  So the company might go with Agency A but
have an all around better bargain with Agency B and not know it if Agency A
had also had a better sales pitch.  Agencies that charge higher mark-ups can
afford better sales and marketing people.  Now, both companies and employees
want consistency in the mark-up.

Finding a consistent mark-up can be a tricky gamble because if you settle on
a mark-up that is too low, then when you have an employee that requires
special needs, like relocation or tools that your company needs to provide
according to a contract, you will have difficulty managing that cost with a
bare-minimum mark-up.  You may need to pass on good opportunities if you can
afford to meet the requirements because your "standard" mark-up is too low.

Lauren
 

> -----Original Message-----
> From: techwr-l-bounces+lt34=csus -dot- edu -at- lists -dot- techwr-l -dot- com 
> [mailto:techwr-l-bounces+lt34=csus -dot- edu -at- lists -dot- techwr-l -dot- com] On 
> Behalf Of Writers Book Mall
> Sent: Sunday, August 05, 2007 2:24 PM
> To: techwr-l
> Subject: The age-old markup question, with a twist
> 
> Hi, all.
> 
> For reasons too obscure to mention, a client wants my
> low-markup payroll agency to charge them a "standard"
> markup.
> 
> For reasons even more obscure, this is actually
> relevant to me. (I say this so that those who would
> normally respond, as I would, with "the agency markup
> is irrelevant to you" will understand that this
> doesn't apply in this case.)
> 
> So, what is the range of "standard" markups for an
> agency these days?
> 
> Thanks!
> 


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