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Many of the contracting agencies I have gone through in the past 20 years demure on this question. Yes, markup is how they profit.
I used to take the first submittal per each contract even if there were multiple contracting agencies advertising it. Nowadays, I sometimes hang back and think about it. If I get varying rates for the same contract by differing agencies I can extrapolate the billing rates.
Agencies that are hungry for work might submit me with a lot less of a -- or even a zero -- profit margin. However, they might have less of a chance really getting me in to an interview, let alone actually hired for the gig. Other agencies may be low-balling and willing to come up with more money for the gig if they thought they had a good change of placing me.
Some agencies regularly and typically under-pay and so I have learned who they are and tend to avoid them. In the end, if I can't tell what is going on, I just go with what my bill rate is, turn down gigs way under, and hope for the best.
I have had in the past clients who were willing to "leak" the information of what they are paying. This is, of course, a sticky wicket -- but on those long term contracts it can give you an idea of whether or not you have any margin to request a raise after 6 months or a year.
Best advice: study the market. If you feel you must ask the billing rate, do so diplomatically and be willing to take "confidential" for an answer. It probably doesn't hurt to ask if you do so politely. Generally, I don't ask, but if others have had better luck with that, I'd be willing to try again. I haven't tried since my callow youth, so hey, if conditions have changed greatly, let me know!
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Rose A. Wilcox
Senior Technical Writer
480-586-2645
480-580-0530 (cell)
Rwilcox -at- ssqi -dot- com
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