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I work for a company that outsource some of our work to an agency. This agency specialize in branding & design, but also sub-contract other work out to designers, developers, etc.

I am new in my role and have been given a monthly budget for external work. I asked the existing agency my company use for a quote for monthly projects that need doing.

The agency only ever give me back one-line figures, which they seem to just make up, i.e.

That'll cost 2,400 per month.

When I ask them for estimates on individual work items and a breakdown of the costs, they ignore me or don't provide the information.

I need a breakdown so I can figure out how to modify my requirements to fit within the budget.

Since this is a new role, I can't really suggest changing a long-standing relationshiop with an agency already, so my question is: How can I request the information I need (a thorough breakdown of costs) from an external agency, whilst maintaining good rapport with them?

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  • The way you describe it you don't really have much choice but to accept the quote they give you as you cannot change suppliers so why do you need the breakdown for? – Tymoteusz Paul Nov 6 '20 at 12:10
  • @TymoteuszPaul the quote is out of budget and need to know where to cut down – Cloud Nov 6 '20 at 12:50
  • It's not clear to me what kind of breakdown you would expect also. I seem to understand the question differently from people answering. Are you looking for a breakdown like design = $xxx / testing = $yyy / project management = $zzz / ... ? Or maybe like "feature 1 costs that much, feature 2 costs that much, ... ? – Laurent S. Nov 6 '20 at 13:19
  • This isn't really a good match for this site. We focus on personnel issues. This is more about how to do your job. – DJClayworth Nov 6 '20 at 14:57
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    "I need a breakdown so I can figure out how to modify my requirements to fit within the budget" - did you say this to them? – Aaron F Nov 7 '20 at 1:04
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  1. Never reply to or deal with this agency again. Forget them and move on.

  2. In general:

but also sub-contract other work out to designers, developers, etc.

Never EVER use these comic shops that just contract out work to min-wage "freelancers".

Anyone who's done development for ten minutes knows this - just forget it.

Since this is a new role, I can't really suggest change ...

Here's the language you need. Go to your boss and say,

Steve, XYZ are asking a huge amount of money for a small task. I suggest we use someone else. What about DEF. Can you give me your thoughts on this?

Just finish with a question, and it will make Steve receptive.

Axing worthless suppliers is the most important part of your role. Enjoy!

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    if XYZ has been otherwise delivering good work, why would you want to change? If they happen to be efficient, you shouldn't care too much about work being subcontracted... actually even if not efficient, you don't care why. – Laurent S. Nov 6 '20 at 13:15
  • @LaurentS. , your first question: the OP clearly describes an utter dumpster fire. If a supplier sent me a "one line quote pulled from the air" and "wouldn't" (?!) give any info, breakdown, or anything - I'd just block their email and that would be the end of it. – Fattie Nov 6 '20 at 13:32
  • Your second question, I will copy and paste "Anyone who's done development for ten minutes knows this - just forget it." These hokey people who just subcontract out to "teams" of min. wage almost-developers .. it is useless. – Fattie Nov 6 '20 at 13:34
  • I've seen how detailed quotes were made in some agencies and it was basically still several lines "pulled from the air" with fancy titles. On the other hand of course a prospect supplier pulling numbers out of his hat with no proper briefing would be a red flag, but a known supplier for which you're a known client might be trusted enough to do it like that from where I see it. – Laurent S. Nov 6 '20 at 16:12
  • Also I've been a developer myself and happened to work with many third party agencies and I've had good experiences with some of them, only realizing months after they were actually sub-contracting. Not all of them are sub-contracting in off-shore "development sweatshops"... Anyway my point is that if you're happy with the work of your provider, and happy with the price they ask for it, you shouldn't care if they subcontract or not. – Laurent S. Nov 6 '20 at 16:19
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Rather than asking for one quote for all monthly projects, break down the quote requests into separate projects and ask for those quotes separately. You can start off by asking for a quote for project A. Once you receive the quote, ask for project B....etc. This is the only way to "force" the company into breaking down their quotes by project. It may be more tedious, but if the company refuses to break down their costs there is little that you can do.

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    I think OP is looking for a breakdown of the different costs inside a specific project. – Laurent S. Nov 6 '20 at 13:22
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As per your comment:

quote is out of budget and need to know where to cut down

That makes your answer to the supplier very simple: "Hey X, I'm sorry to say that this is out of the budget so please provide a breakdown so we can see what features can be cut out in order to meet the budget for this project.". And that's about it, no need to complicate it more than it has to be.

But you also need to affirm what exactly is and isn't in your powers. If you are supposed to manage the budget then you also should have the freedom to at least shop around and compare quotes, even if final decision on switching may need an approval from the proverbial upstairs. Heck, there should be nothing to stop you from at least gathering quotes elsewhere as that's in no way binding. So while haggling with the current supplier send some feelers out and at least get an idea of the competition.

Ultimately without having competitive quotes you don't know whether the price is fair or not.

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I would likely take the approach of being honest with them about the reason you require the breakdown:

I need a breakdown so I can figure out how to modify my requirements to fit within the budget.

Explain you are new to the position and need more information at first so you can modify your requirements, but after the learning curve is mostly complete, you would not need the breakdown.

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Find another agency, one that will break down the costs for you in a way you find satisfactory.

Award the work to this new agency.

Tell the old agency that you're sorry you couldn't work with them on this occasion, but you needed more granularity in the quote than they were able to supply this time, and you hope to be able to work with them again soon.

When the next project comes in, watch the old agency give you a nice itemised quote.

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You just ask them, something like: "I don't have the budget to cover that this month, my maximum is x, what work items can you do within that budget?"

You could also ask if they could charge hourly instead, and commit to x hours for the month.

There are many legitimate reasons for not giving a more granular breakdown.

I have worked for software/design agencies, and while tasks get quoted on individually internally, providing a granular breakdown can often lead to problems. - Usually because each tasks time is reliant on another. If you change 1 task, it changes the entire quote, so you can't just pick items from it.

eg. Task A is a 10 hour task, Task B is a 10 hour task. Task A covers a lot of setup, so Task B can be reduced to 1 Hour, so we quote 11 Hours. - Client Chooses Task B and says forget A. To complete B without A now requires 10 Hours, not 1... but sales continue to sell it for 1 hour because they're scared of telling the client it would take 10x longer than they're expecting.

This type of thing shouldn't happen, but it does. Giving granularity to a client always seems problematic so I guess that's why it's avoided.

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  • Giving them a number puts your company at a significant disadvantage. Once they know you can afford $x, they will magically find a way to sell you exactly $x worth of services, regardless of the price they might otherwise have charged for the same services. This is also (probably) why they don't want to provide a cost breakdown. – Kevin Nov 7 '20 at 4:45
  • Yeah, this too. Main reason for charging per project instead of per hour is you can charge more than you could get away with by charging hourly. --- Important to note for anyone reading this, this doesn't mean it's a rip off. It's like increasing the mark-up. Something every good business must do. – flexi Nov 7 '20 at 12:17

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