RE: What is a reasonable cut that a contracting company should take?

Brian,

I have had this same dificulty determining current market rates, so I will post what little relevant experience I can on the matter. After being offered $45/hr. from a consulting company for security architect work, I started to become concerned that I was in the wrong field. Looking through direct billing records for GSA contracts on the Internet however, I found rates being charged *to* customers from such consulting firms were anywhere between $95 and $195 /hr. My experience led me to believe that I should be "up there" in billing at the high end here. I also knew from experience consulting in the past that my rates there were flexible but were being charged out at around $250 / hr. to customers. Higher than the GSA rate.

These are obviously widely varying targets.

The last bit of information I can contribute is this; I managed to negotiate a rate with a local IT consulting firm that caters to a relatively normal (and at this time, stable) market - health care. They have a formula something like this; 33% of contract award is to go to the sales staff for digging up the opportunity, 33% of the contract is fed back to the firm for overhead and base salaries, and 33% of the contract is finally awarded to the engineers actually doing the job! They were willing to bottom-out the hourly rate for such contracts at $75/hr. directly to me.

And even this seems low, though in relation to the way this admittedly small consulting firms dig up and maintain their business, it may well be fair for both parties. A larger more established firm may do better in overhead costs. I can't say, however, looking at the original $45/hr. offer from just such a firm, I'd say they were trying to keep 75% of the contract award if not more.

...which does *not* seem fair. I'm glad it never happened.

-Ace

> -----Original Message-----
> From: Brian Cahill [mailto:bcahillcissp@hotmail.com]
> Sent: Monday, December 16, 2002 3:55 PM
> To: securityjobs@securityfocus.com
> Subject: What is a reasonable cut that a contracting company
> should take?
>
>
>
> Hi,
>
> I am submitting myself on a security project via a
Received on Tue Dec 17 11:46:28 2002

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