@kelly said in How Can the FTE Model Compete with the MSP Model?:

Maybe not directly for the company, but the MSP has to recoup the costs of time and travel somehow, and that will affect rates if you're going to stay profitable.

That is very true, no denying that. But you can build those costs in. There are certainly costs involved, but there are savings too. You have to look at the whole picture.

In this example, we have housing costs about 20% lower than they do, our fuel is way cheaper ($.25 I bet), and our Internet is a fraction of the cost (about 10% the cost, I kid you not.) Going local to them would require us to raise prices, traveling to them is trivial.

@Dashrender said:

@IRJ said:

My experience with staffing companies is that they get more than 2%. Most of the time I have worked with them I have been able to negotiate a higher salary. I know they have to have more wiggle room than 2% to allow negotiation on salaries.

Why? They simply pass the cost along to the company you really work for. I'd guess that the employing company and the staffing company have some sort of agreement of salary range for the position. Though if you think about it, assuming a straight percentage is how they are paid, it would be in the best interest of the staffing company to get all staff placed at the maximum rate the position allows.

Not if the customer sets the price. All depends on the contract.