Re: Margins

["David B. Demyan" <dbdemyan -at- WORLDNET -dot- ATT -dot- NET>]

Mary Towle wrote:

> When I worked in the Salt Lake City area, the going markup varied
> from
> 25 to 33%.  That, to me, seems reasonable.  I moved to the Knoxville
> area
> recently where the markup seems to be from 60 to 65%!!!!!  Something
> is
> not right here.  Anybody out there know how agencies in this area
> can
> charge so much?

Mary;

There's more than one kind of agency. I have lately become aware
of consulting firms who hire both permanent and contract people and
then put them on major "projects" for their clients. This is prevalent
in the *hot* technologies. Purely as an example: a firm wants to
deploy the latest and greatest from Redmond throughout their
company. They contact The Big Twenty systems consulting house.
Big Twenty comes in and bids to have analysts, architects, programmers,
trainers, and technical writers come in to the firm and get the new
system up and running. For this, they may charge $20 million (to pull
a number out of the clouds). This is based on an estimated project
effort of, say 2000 people-days at $1000 per day (really round nos.).
Those numbers are supposed to cover all expenses -- maybe even
travel and lodging (at Embassy, of course).

My gross example is just that: an example to show how the numbers
can sometimes get inflated. And it does pay to keep this all in mind
when comparing rates and locales. If you are not part of such a
project, maybe 60-65% is out of kilter. But my previous comments
on this subject still apply: if you *know* the markup is too high,
demand a more reasonable percentage of the billing. You have to
be willing to back it up by leaving the agency (or the area) and
finding one that will treat you fairly.

Best wishes,
Dave.
--
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David B. Demyan                                   Mendem Concord, Inc.
Toll Free: (888) 753-8500                            Technical Writers
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