My margin is none of your business!

So you want to know how much I charge on top of the consultant’s fee. Perhaps you feel like I’m sitting back and lining my pockets off the back of my contractors/consultants work. I really wish it was that simple.

My margin is none of your business!

My profit is not the sum of my daily margin. This assumption forgets that I also have costs to cover. My margin needs to cover the costs I incur in finding, assessing, and matching contractors or consultants to your project. It needs to cover my business overheads. Aside from the standard on costs such as payroll tax, insurances and financing, I also need to pay for advertising, business insurances, internal staff wages, licenses, training, website, rent, phones, electricity, and so much more. Before I get to take home any profit, these expenses must come out.

Possibly the biggest risk we face is slow or non-payment of invoices. Margins are often as low as 7 – 6%, when you consider daily contractor rates and multiply it but say 30-50 contractors per day you may get an idea of the payroll burden we carry. I have yet to meet a contractor or consultant who has said, “hey just pay me when you get paid”.

Secondly, my time has value. I have the skills, experience, and focus to find the right resources for your business. My skills are constantly being developed and with nothing else to distract me, I can work much more efficiently at bringing people together. The true value I add is in freeing your time. That’s why businesses use our services and expertise rather than investing the time, costs, and energy to find the right resources themselves and congruently contractors offer their services through an agent rather than investing their time, cost, and energy to find the right opportunities for themselves.

The reason my margin is none of your business is because you aren’t running my business. I’m handling my costs, my training, and my time. Part of my role is to help with a small aspect of your business. I do this effectively and efficiently. Depending on what your business is, you may provide products or services that I use to help with my business. If it’s not something I personally utilise, there are plenty of other customers who do benefit from what you offer. The point is that we are both running a business. Ideally we are both covering our costs and being rewarded for providing something of value.

That’s why my margin is my business.