[Hidden-tech] Retainers

[Shel Horowitz]

There are probably a hundred ways to structure a retainer. 
Personally, I probably wouldn't roll the unused hours over, since the 
whole point of the lower hourly is the guaranteed level of work. But 
nothing prevents you from doing it that way.

However, I probably *would* bill additional hours at the reduced rate.

>I am trying to create a new consulting relationship with an 
>organization, and I am wondering about the concept of a retainer. 
>When one agrees to be on retainer, does one receive a set amount of 
>money per month? And, if so, does one agree to provide a certain 
>number of hours of work? How would that hourly rate compare to a 
>situation if there was no retainer?
>
>Hypothetically speaking: say I have a client for whom I currently 
>provide services on an as-needed basis for $100 per hour. I might do 
>anywhere from 0 to 25 hours of work in a given month. I am looking 
>for a way to get more work on a regular basis. In exchange for some 
>sort of guaranteed monthly payment, I would be willing to lower my 
>rate. My thought would be to propose a retainer of $1,200 per month 
>in exchange for which I would do up to 15 hours of work ($80 per 
>hour).
>
>Is that how a retainer works? If the client does not utilize their 
>15 hours in a month, do they "rollover" to the next month (that 
>would reduce the benefit of the retainer agreement to me)? And if 
>the client needs me for additional work, would I bill them at the 
>new, lower rate based on the retainer amount (i.e. $80 instead of 
>$100)?


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