"End User" Rate
"End User" Rate
(OP)
I've got a regular client (another consultant) that dropped the following statement in my lap yesterday, after doing two years of work together: "these are end user rates, I need subcontractor rates."
I've never heard of such a thing in engineering services. And I'm miffed that he's saying this after two years. Does anyone out there have one rate for end users, another rate if you're working for the end user's lead consultant?
I've never heard of such a thing in engineering services. And I'm miffed that he's saying this after two years. Does anyone out there have one rate for end users, another rate if you're working for the end user's lead consultant?





RE: "End User" Rate
Rafiq Bulsara
http://www.srengineersct.com
RE: "End User" Rate
My subs do not have to deal with trying to get payment from the client, or managing the project.
RE: "End User" Rate
As with any cost structure, you start with the basic hourly rate for labor, and add to it the various overhead, general, and administrative costs. As indicated by greenone, one could discount the rate if certain things are not really being exercised.
TTFN
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RE: "End User" Rate
RE: "End User" Rate
He wants to make sure that the end user sees an invoice from him that shows my output listed as a line item on his invoice at a price that would be the same the one I'd charge if I went to the end user direct.
Let's use $1200 as an easy example.
So if my invoice to the end user would have been $1200, he wants to make sure his invoice to the end user is $1200. So I'd have to invoice him $1000, and he marks it up. The kicker is, he doesn't want to mark anything up or show anything on his invoice. He wants to show the client my invoice on my letterhead. So for clients of his where he introduces me, he wants me to invoice the client $1200, but he also wants to send me an invoice for $200 for "consulting". Basically what he would have made on markup.
And so far he's been pushy on what it's supposed to cover. Not only my rate, but any subs I use myself. Basically the entire total that I invoice. So if my $1200 job had $500 in subs, instead of being left with $700, I'm left with $500.
I also own another company, a specialty construction company, and he's tried to apply the same logic there - "if one of my clients needs this and you can do it, I'll introduce you but you need to give me 20%." He tried to say that's how GC's work it, but I put my foot down and said, look, I've been dealing with GC's as a sub for decades, and a GC has never asked me for a cut of my end of any kind. They ask for the best price I can do it for, period. He said, well I'm not an engineer, but this is how I've been doing it.
RE: "End User" Rate
I'd start calling him Wal-Mart.
www.ellisconsultingengineers.com
RE: "End User" Rate
RE: "End User" Rate
Rafiq Bulsara
http://www.srengineersct.com
RE: "End User" Rate
Are you guys like me, working on a Saturday?
RE: "End User" Rate
RE: "End User" Rate
TTFN
FAQ731-376: Eng-Tips.com Forum Policies
Chinese prisoner wins Nobel Peace Prize
RE: "End User" Rate
RE: "End User" Rate
RE: "End User" Rate
I typically include a line item for coordination/management of subs. On a lump sum job the extra line item covers the sub issue and provides for the profit.
On hourly rate jobs I include an estimate of hours for coordination and the multiplier on my rate for dealing with subs covers the cost.
RE: "End User" Rate
RE: "End User" Rate
Absolutely.
Except if you're selling cars, in which case it's industry standard, and it's called a "holdback" instead of a "kickback."
Funny how ethics work.
Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East - http://www.campbellcivil.com
RE: "End User" Rate
Cheers
Greg Locock
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RE: "End User" Rate