Consulting Companies

[Kelemvor]

Just wondering if anyone has any firsthand knowledge of this...

I'm currently working as a consultant at a company. I work for the consulting company and the company I work at, pays the consulting company and then they pay me. Standard setup.

What I'm wondering is, what's an average amount that the company I work at pays above and beyond my pay that goes to the consulting company?

Say I make $25/hr. Would the company really be paying $30/hr for me to work there? Is it more like $50/hr? I have no idea so I"m just looking for someone that used to work as the consulting place or knows someone who does or whatever.

Thanks.

 

[Uppsala9496]

What type of consulting? What metro area?

 

[Kelemvor]

IT stuff. Desktop support, rolling out new equipment, etc.

I'm in the Milwaukee, WI area.

 

[SoulAssassin]

2-3x what they're paying you is about standard...maybe a little closer to 2x but it can vary.

 

[JRock]

I can say that we charge between $300 and $350 an hour and the tech sees about $45 - $65 of that depending on what is being done. This is in the Tri-State area.

 

[Kelemvor]

Originally posted by: JRock
I can say that we charge between $300 and $350 an hour and the tech sees about $45 - $65 of that depending on what is being done. This is in the Tri-State area.

Holy Jeez.

Does it change if it's a short term versus a long term contract? Last place I was there for like 9-10 months. Current place it's kind of open ended. Just seems like it costs way more than just hiring someone

 

[JRock]

We have never really had any projects that exceed a week. I will see what I can find out.

 

[akshatp]

AFAIK Usually it is about 3x-4x what you are making...

 

[EagleKeeper]

Much depends on your skills, the contracting company and the client.

I know of one that was paying the person $35/hr and billing the client at $55/hr.

Others have been 2-3x the billing rate.

Some depends on what benefits the contract is getting through the contracting company and the amount of overhead that the contracting company has.

 

[JayHu]

When I did some consulting in Ottawa, they would take ~10-25% of what the company actually pays. Which looking in the other posts in this thread wasn't that bad (but it felt like it )

 

[MixMasterTang]

It also depends on if you are a W2 employee for the contract company and you get benefits? But usually I have seen about 3 to 4 times your pay is what the company pays your contracting company (if you are getting benefits) otherwise in my experience it is 2-3 times your base pay if (because you get paid higher if you are not a W2 employee and/or don't have any benefits).

 

[ghostman]

Originally posted by: JRock
I can say that we charge between $300 and $350 an hour and the tech sees about $45 - $65 of that depending on what is being done. This is in the Tri-State area.

This sounds about right. My girlfriend used to do IT consulting at <major computer company> and she somehow learned how much the clients get charged. Not only that, but the consulting firm had to meet a certain number of hours every month so they can charge the clients, even when there was nothing to do.

 

[markgm]

It really depends. At the first company I did consulting at I was making about 50% what the consulting company was pulling in. The second job I took another company was making about $5/hr off of me, and it went down to about $1 and change after IBM cut the rate. It all depends on how well you're able to negotiate and how many people are out their with your skills.

I would suggest not discussing the rate in detail until after you have the interview with the client. Once the client says they want to hire you you're in a better position to discuss the rate. If the client isn't locked into a consulting company you have a better position because they's rather make something off of you rather than have the contract go to another company and make nothing.

The other thing that affects it is the length of the contract. On a longer contract the rate is usually a little lower, so the margin isn't as big.

I kind of miss being a consultant. I used to work in other states and get paid per diem which really saved me a boat load on my taxes.

 

[fisheerman]

Originally posted by: SoulAssassin
2-3x what they're paying you is about standard...maybe a little closer to 2x but it can vary.

to clarify it is usually 2-3x what your salary range is throughout the organization not just what you make X2 or x 3.

just an example

so lets say your company is charging $90 bucks an hour for an analyst. if you look at the total salaries across the board for analyst in your company and the company is billing at a 3 factor then the result would be 90 / 3 = $30 an hour.

at least this is the way it worked at a engineering company i worked at.

although you may not make the $30 dollars an hour (maybe you only made $25) someone in your company was probably making $35 for the same analyst job. Usually to make up for variations in different markets (ie DC vs Raleigh).

-fish

 

[JeffreyLebowski]

Originally posted by: Kelemvor
IT stuff. Desktop support, rolling out new equipment, etc.

I'm in the Milwaukee, WI area.

I'm in the same boat. We charge our customer $50 per PC per month. There are about 2200 PC's in the environment. So we make $1.3 million a year. There are 11 people on the contract including helpdesk people. So basically each person brings in $120,000 a year for my company. Which is about 3x what I make.

 

[Zolty]

When I was a consultant the company took 4/hr off my wage, so the company paid 28/hr and I got 24/hr. But that consultant company is relatively new and quite small.