Earlier quoted context omitted.
"First of all because agencies get away with charging that much" Perhaps they deliver a different sort of value than an individual freelancer? Having a larger staff, having multiple people with different expertise, separate billing/financial folks, admin folks, etc. They provide a different set of services and customer experience - some people want/need that, some don't, but just because agency ABC is charing $200/hr…
Fair points, you're thinking on a different scale for me. The agencies I'm thinking of were little more than chop shops who hire and then resell. The only positive they could give you is if someone is sick they can back fill; but having seen it in action that's really just someone unfamiliar with the processes warming a seat for a few days and not doing much. MSDN $2kpa. Liability $1kpa. I guess it's not "a lot" but…
I don't even do MSDN costs. :) But there are definitely some overheads - insurance, I have office space (coworking), services (bookkeeping, etc), transportation - conferences, etc. I may have, say, $12k in overhead each year - including health insurance. That cost is pretty much the same whether I bring in $15k or $150k, and certainly if you're bringing in $15k, those expenses are far higher % of income.