Set a margin floor
Agree a minimum margin, overall or by client or sector, and make it visible to everyone who sets rates. A floor turns a judgement call into a clear rule.
Check every rate before it goes live
Check pay and charge rates at the point they are entered, not at month end. If a rate falls below the floor, it should be obvious immediately.
Route exceptions for approval
Sometimes a low-margin deal is the right call. Make those exceptions explicit: the consultant requests approval, a director approves or rejects, and the reason is recorded.
Watch extensions and rate changes
Extensions and rate changes are where margin drifts. Re-check margin on every extension and pass on pay changes to the charge rate where your terms allow.
Review the live book monthly
- Placements below the floor
- Clients with the lowest average margin
- Consultants with the most exceptions
Use the review to renegotiate, re-rate or coach.
Understand where the money goes
Margin is what is left after pay, employer costs and any other on-costs are taken from the charge rate. Make sure everyone who sets rates understands the full cost of a worker, not just the hourly pay. A rate that looks healthy on pay alone can be thin once employer costs are included.
A worked example
Imagine a client wants to reduce a charge rate by a small amount to win a long-running booking. Over many hours a week and many weeks, that small change can add up to a significant amount of lost gross profit. Showing the annual effect of a rate change, not just the hourly difference, helps consultants negotiate with confidence.
Common margin leaks
- Pay increases not passed on to the charge rate
- Extensions agreed at old rates
- Overtime and unsocial hours paid at higher rates but charged at standard rates
- Discounts agreed verbally and never recorded
- Rates entered in a hurry with no second check
Make margin part of the culture
Share margin figures with consultants, not just fees. When people can see the margin on their own book, they start protecting it naturally. Recognise consultants who grow margin as well as those who grow volume.
How Veyra helps
Veyra checks margin on every rate against your floor, suggests a charge rate that clears it and routes exceptions for approval - inside Salesforce and Bullhorn.