A managed service provider, or MSP, is a third-party vendor that an organization can engage to help manage certain aspects of the organization’s business processes, such as an external worker procurement program.
If a Managed Service Provider, or MSP, is involved in SAP Fieldglass transactions, WorkingNet may see a different final bill rate than reCrewIT. This is because the MSP charges a fee for its service, and that fee is reflected in the final bill.
The MSP fee is only seen by the organization that is paying that fee.
In a Buyer-Funded program, the configured MSP fee is paid for by the buyer. So if WorkingNet uses an MSP—CoLabor8—to manage its external workforce procurement program. CoLabor8 will add a percentage for each transaction. So if reCrewIT presents their Bill Rate as 97.09, CoLabor8 will add 3% to that (2.91) and add it to the WorkingNet’s Bill Rate (100.00). The difference is because of CoLabor8’s service fee.
In a Supplier-Funded program, the MSP fee is paid for by the supplier. So if reCrewIT is paying Colabor8, their bill rate will be higher than WorkingNet’s.
Multiple suppliers can participate in a supplier-funded model. Each of the suppliers engaged in the program can then pay a portion of the fee, spreading out the cost.
If a customer wants to pursue a supplier-funded model, it’s important that this be negotiated in each of their supplier agreements.