4 ms·

In this kind of discussion context, typically the OP's rates are the bill rates to clients (the OP's company). I normally see the smaller agencies clear 40-50%

In this kind of discussion context, typically the OP's rates are the bill rates to clients (the OP's company). I normally see the smaller agencies clear 40-50% margin, and the big names are clearing 50-80%, so I wouldn't be surprised if those agencies in Ukraine and India were paying their teams in the $60-75 per hour USD range at most, which is considered really good in those parts of the world.

rakamotog 6y ago
Margins are much higher. Large scale IT Services pay around 40$-60$/day for skilled specialists. I briefly worked in a specialised consulting role where the charge to company was $2000 per day and my cost to the company was $55/day.
- ska 6y ago
  This is why it's not hard to bill $1000-1500/day as a freelancer with the right skills. One of those skills has to be sales, though.
tootie 6y ago
I used to do margin calculations at a mid-size US agency that staffed a lot of roles. In terms of actual project margin, we rarely got past 30% and was usually more like 15-20. The trick is that there is a lot of cost in operating an agency beyond just salary. The cost to the agency of employing a developer (or a designer or a tester or whatever) is more than just what they're paid. We had a rate card that included both the cost to the agency per hour for a particular role and the agreed rate we had settled with the client. We had a fixed rate for each role/locale even though we paid people different amounts. I knew my own salary and handful for my direct reports and the "cost" side of the rate card was a lot more than I was getting paid. And that cost was the base on which padded to get profit from the client. And that profit itself wasn't pure profit for the company because a lot of paid for our fixed costs (office space, hardware) and non-billable roles (HR, receptionists). And of course a lot of it ends up in the hands of our holding company and their stock holders.

rakamotog 6y ago

Margins are much higher. Large scale IT Services pay around 40$-60$/day for skilled specialists. I briefly worked in a specialised consulting role where the charge to company was $2000 per day and my cost to the company was $55/day.

ska 6y ago
This is why it's not hard to bill $1000-1500/day as a freelancer with the right skills. One of those skills has to be sales, though.

tootie 6y ago

I used to do margin calculations at a mid-size US agency that staffed a lot of roles. In terms of actual project margin, we rarely got past 30% and was usually more like 15-20. The trick is that there is a lot of cost in operating an agency beyond just salary. The cost to the agency of employing a developer (or a designer or a tester or whatever) is more than just what they're paid. We had a rate card that included both the cost to the agency per hour for a particular role and the agreed rate we had settled with the client. We had a fixed rate for each role/locale even though we paid people different amounts. I knew my own salary and handful for my direct reports and the "cost" side of the rate card was a lot more than I was getting paid. And that cost was the base on which padded to get profit from the client. And that profit itself wasn't pure profit for the company because a lot of paid for our fixed costs (office space, hardware) and non-billable roles (HR, receptionists). And of course a lot of it ends up in the hands of our holding company and their stock holders.