# What is permanent fee?

Source: https://launch-rec.com/glossary/perm-fee. Category: Commercials. Market: US and UK.

Also called: placement fee, perm fee.

## Definition

A one-off fee for a permanent hire, usually 15% to 25% of first-year salary, billed on start date and subject to a rebate period.

## In practice

Perm revenue is high margin and immediate, but it is lumpy and does not compound. Contract revenue is lower margin per hour and compounds every week the contractor works.

Most durable agencies use perm to fund the working capital that contract consumes in year one, then rebalance as the contract book matures.

## Related terms

- https://launch-rec.com/glossary/rebate-period
- https://launch-rec.com/glossary/gross-margin
- https://launch-rec.com/glossary/working-capital