Bringing Business to the Company? 1

[ee2002]

Hello all,

I am an employee at an engineering consulting firm. I am starting to make some contacts and am working on bringing new business to the company. I am meeting with some potential clients to tell them a bit about the company, myself and handout a company resum. When I start bringing my own jobs in, does it make sense that I should receive a finder's fee of some sort for every project brought to the company? I think growing the business deserves some incentive, and a project by project based incentive plan sounds like it could be a good thing for the employer and the employee. For instance, an example could be that any job brought to the company would require the company to pay me 7% of the total project fee. Any feedback would be greatly appreciated wehther you have experience with this type of situation or not.

Thank you.

 

[zdas04]

You never get what you deserve in this world. You get what you negotiate. Talk to your boss and propose a finder's fee and see if bites. It might be a path to bigger and better things for you, and it might be a path out of the company. You never know until you put that ore in the water.

Good Luck

David

 

[GregLamberson]

I agree with David.

If the company has a business development guy, he might push back a little, but you never know until you ask.

I would suggest you approach it with the idea of a finder's fee based on signing a contract or of actual work generated. And it would be helpful to provide some examples of the type of business you can bring, type of company you are meeting with, etc. Personally I would appreciate a guy taking the initiative and trying to get work coming in the door.

Question is - what is a reasonable finders fee? Anyone have any ideas???

Greg Lamberson
Consultant - Upstream Energy
Website:

http://www.oil-gas-consulting.com

 

[COEngineeer]

At our company, we get 5% of unused $ in the contract.

 

[sms]

Believe it or not, some companies won't appriciate you bringing in new clients. If they have a business focus and strategy that you don't know about, if they have limited resources, and if it is not your job to do so, it could get you into hot water....

-The future's so bright I gotta wear shades!

 

[prohammy]

As mentioned above, a finder's fee is an option that many companies will look at as an incentive for their employees, but there is no such a thing as genorosity when it comes to this type of incentive. The chances of you getting 7% of the project budjet are virtually nil. Most companies will run such a scheme as a fixed sum or rising fixed sum, depending on the level of business you bring to the company (this is basically the commission scheme).

But, don't let this stop you



Kevin Hammond

Mechanical Design Engineer
Derbyshire, UK

 

[cvg]

business development is a normal part of consulting and is expected from project management. If you are not in management and are successful bringing in clients, then you should be asking for a promotion. However, a commission is probably not realistic. I have not heard of commissions being paid for business development in this business. That said, a lot of companies do pay year end bonuses which are tied to both company and employer performance. Again this is usually limited to project managers and higher. So, shoot for the promotion.

 

[GMcD]

As SMS said- talk to the Partners first about bringing in work- while it may seem like a good idea at the time, no good deed goes unpunished. It had better be the type of work that fits their strategy, and it had better be profitable. One bad job will get turned into "we should never do that type of work- we "always" lose money on them" (even though 4 out of 5 of those jobs went well...)

As a salaried employee, you also have to think that the "finders fee" you think you should get is actually your salary. The company pays you to do the work, and if bringing work into the company pays for itself, then consider that contributing to your salary. If you think you should get a finders fee for bringing work in, then maybe you should try setting up your own business and take all the fees for yourself. Are these projects coming in due to the Company's reputation, or your own?

I agree with what CVG stated - consider it part of your job and make sure the management sees this extra effort and you can be rewarded in other ways. If that doesn't pan out, then you have the choice of going out on your own, or finding another company that appreciates your efforts more.

 

[KENAT]

At my last place it just got taken account of as part of your general salary review each year.

Though being defence we had a more limited clientel so it wasn't quite as relevant. Chances were we aleady knew and had work from the client, it was just getting in extra/winning over companies.

 

[michfan]

At a huge, multi-national company that I worked for, we got a $5 Burger King gift certificate any time we saved the company over $50,000. No kidding...

 

[MintJulep]

Are you willing to kick in 7% of the loss if the job is a looser?

 

[zcp]

7%!?! Of the total project fee!?! Wow. This better be some profitable work, better fit into the company's business strategy, and plan on taking a pay cut out of your guaranteed salary to reap this big reward. That way you share the risk that your company is taking on the project.

Try sitting down and putting a pencil (or pen) to paper and figuring out how profitable your projects are for the company once your salary, materials, AND overhead are included. Then add in any unprofitable or break even projects that are done (you can't just cherry pick the good ones).

Out of what is left, I see no reason why a portion of that could not go to a finder's fee or incentive. Considering you take no inherent risk on the project, that portion may be lower than you think.

ZCP

http://www.phoenix-engineer.com

 

[KENAT]

7% does sound high. At my last place the planned 'profit margin' was less than that. Where did you get that figure? Is this the going rate in your industry/part of the world, if so I took the wrong course!

Now if I could have got a % of the amount we came in under budget on some of my programs at my last place I wouldn't have been unhappy! Just so long as I didn't have to subsidize the couple that went over budget (of the 2 I recal neither were my fault, on one I can blame production and on the over I have the choice of blaming management or job shoppers).

 

[cvg]

profit for the majority of our projects is 10 - 12%. Occasionally may be more if we negotiate a lump sum fee and finish under budget. However, awarding the finder a percentage of that profit would be unrealistic, since the project manager is the one responsible for making the project a success and actually making the profit a reality. Finding a client is a small part of the business development. Unless you are writing the proposals and scoping / budgeting the projects, you don't deserve a very large percentage of any potential future profit. A finders fee would be nice, but maybe dinner at a nice restaraunt would be more likely...

 

[atlas06]

How cheap can some employers get?
Here is work walking in the door without advertizing, markettimng, presentation, and so on and most are thinking a diner at best for the guy that brings in work.
The boss meets 10 potential custumers to score on one contract, using so many comapny ressources and time to get that contract.
Not counting, that kind of work fills in a few gaps for times when the place is slow, and have people do something instead of laying them off.

You deserve better, and if you are good at bringing in work, strike it on your own, man. Don't listen to these guys telling you 7% is too much. They tell you that they have only 10% profit (after pulling a $500,000/year salary), yeah, right.

 

[cvg]

what planet are you from? I'm still waiting to meet an engineer making $500,000 per year. That is generally reserved for the CEO, not a junior engineer! Bringing in work does not guarantee any profit. In fact, there is always a chance of losing money on a job if the project manager does a poor job. So why would a company pay nearly all of it's profit to the person who found the job, if that person wasn't even responsible for managing it? EE2002 should concentrate on his promotion and gaining valuable experience before striking out on his own.

 

[ee2002]

Thank you all for your responses. I apologize for not being more descript. The plan is NOT that I would simply be handing these jobs off to some higher up manager. I write the proposals and figure project budget, manage the projects, engineer the plans and see the project through to completion. Furthermore, my plan is to guarantee that the project come in at or under budget. If the project requires additional hours to see through to completion, then I will work these hours without pay. This way I will share in the profits and losses.

There is no magic as to how the 7% came about. I just stated my best guess as to what a fair number might be.

 

[bvanhiel]

It still sounds like your asking for a salesman's comission and an engineer's salary at the same time. Not to say it can't be done, but good luck.

-b

 

[SomptingGuy]

I'd be quite annoyed if I found out that our business development people were getting a cut of the revenue they brought in. All jobs are sold based on the reputation and experience of the company as a whole.

 

[atlas06]

CVG
The employer is in business to make money, not to employ people, any employer with 10 plus employees pulls that kind of salary, they are also good at fooling employees (I don't mean to be rude, but you are one of the fooled ones).
As for CEO's (large firms), they are compensated with stock options (which goes in millions of dollars).

EE2002:
I had the impression that you were an Electrical Engineer bringing work with your OWN connections. From what you describe, you actually use your employer's reputation to get work, and that you are paid to bring in work.
In that case, I'd say, you not entitled to anything.

No heart feelings folks, this is only a discussion, so no need to ask me which planet I come from (USA of course).

Thank you