Percentage Charges

Another way to compensate an agency is by adding a markup of percentage charges to various services the agency purchases from outside providers. These may include market research, artwork, printing, photography, and other services or materials. Markups usually range from 17.65 to 20 percent and are added to the client's overall bill. Since suppliers of these services do not allow the agency a commission, percentage charges cover administrative costs while allowing a reasonable profit for the agency's efforts. (A markup of 17.65 percent of costs added to the initial cost would yield a 15 percent commission. For example, research costs of $100,000 x 17.65% = $100,000 + $17,650 = $117,650. The $17,650 markup is about 15 percent of $117,650.)

Was this article helpful?

0 0
Online Survey Champion

Online Survey Champion

There are people all over the world trying to find ways to make money online. From stay at home moms looking to make a few extra dollars to college students and entrepreneurs, the allure of making your own hours and working from home or from the local coffee shop is very appealing.

Get My Free Ebook

Post a comment