To keep your freelance business moving forward, it’s good to have a carousel of clients. But when the music stops and some of your clients get off, a retainer could allow you to keep the ride going.
There’s no escaping it. If you want a thriving freelance business, you need a constant influx of new clients, right? Well, not necessarily.
There’s a way you can spend less time pitching and more time producing the work your clients know (and love) you for. Welcome to the world of retainers.
Properly drafted and executed, a retainer agreement allows you to wave goodbye to relying on ad hoc projects and instead home in on clients you actually want to have a long-term working relationship with.
What is a retainer agreement?
A retainer agreement is a contract where your client retains access to your professional services on an ongoing basis.
This involves your client paying you a fixed (typically discounted) fee every interval – whether that’s weekly, monthly or yearly – to be on standby to deliver a service that you agree in advance.
Let’s say you normally churn out ten hours’ worth of freelance work for your client every month for a fee of £100 per hour. That’s £1,000 billable for the month. With a retainer, you’d probably charge a reduced rate of, say, £80 per hour for the same number of hours work. Only this flat monthly fee – of £800 – is guaranteed come what may.
A retainer agreement is a win-win. Your client has the benefit of your expertise on tap at a discounted rate and you have the benefit of receiving a recurring (albeit reduced) fee. Best of all, you don’t have to spend time finding, schmoozing, and pitching to new clients.
Not all retainer agreements are created equal
Retainers fall into two main categories.
Under the classic use-it-or-lose-it model, if your client doesn’t use your services, they still pay the retainer but forfeit the use of your services. It’s a bit like signing up for a year-long gym membership and never once using it. You snooze, you lose.
In other retainer models, your client pays the retainer to have access to your services. They also incur additional fees (and, potentially, call-out charges) if they actually use your services.
The model you choose to use will depend on:
- The kind of services you provide
- Your expertise
- Your client’s needs
- Your relationship with your client
What are the advantages of using a retainer agreement?
Here are three good reasons to use a retainer.
One of the near-inevitabilities of freelance work is income uncertainty.
Many a freelancer, the world over, has succumbed to the machinations of the “feast-and-famine” cycle. Every month, your bills keep coming in thick and fast, but the money to pay them can be a lot less predictable. Sometimes, you’re quids in, other times not.
But if your client is true to their word and pays you on time – much like an employee – you’re more or less certain to receive steady pay without sacrificing the coveted status of being your own boss.
The best clients are the ones that trust you to get on with the task at hand. And a retainer agreement calls for truckloads of trust – especially on your client’s part.
The typical client that is likely to use a retainer is one that you’ve worked with for some time and is not only familiar with your work, but also your reliability, integrity, and overall awesomeness. Using a retainer, you’ll stay connected with a select number of preferred clients rather than any client who just happens to make your acquaintance.
Clients prefer retainers
Most companies prefer to use a reliable freelancer they know rather than scour the net for new talent every time they need freelance services.
What are the disadvantages of using a retainer?
The main drawbacks of using a retainer are threefold.
- Lower pay.
- Varying work levels (some months, you may not even get as much as a whiff of any work and, in others, you may be stretched beyond belief).
- Scheduling conflicts and limited earning potential (being on-call for your client means being available on-demand, so the work you do for your other clients could take a serious hit).
How to offer a retainer (that keeps your client onboard)
It can be a tough fight to get a client to agree to a retainer that meets their needs and properly safeguards your freelance business.
Follow these rules to stay on the safe side of the ropes.
Work with current clients
A retainer isn’t generally suitable for new clients.
For example, you probably wouldn’t want an ongoing relationship with a client that is difficult, micro-managing, or notoriously hard to please. No amount of interviews, questionnaires, and such will help you weed out undesirable clients ahead of time. Only time spent actually working with them can do that.
Define the scope of your contract
Given half a chance, a retainer agreement can take on a life of its own, so it’s important that your contract clearly states your fee and the type and amount of work you’ll be paid for.
So, if you’re a freelance writer, for example, rather than your contract stating that you’ll write “one article per month” for your client, it should drill down on the specifics. For instance, to avoid disputes, it should specify that you will write “one article per month of up to 1,000 words, with the topic to be agreed seven days before the deadline.”
Limit your contract to quantifiable assignments
When using a retainer, your best bet is to agree to complete quantifiable assignments, such as writing four blogs per month, one social media post per day, or something similar.
Without any meaningful numbers in the mix, it’ll be difficult to predict if you’ll be able to hit your client’s targets from one month to the next. To manage your client’s expectations (and your own), the last thing you need is for your targets and milestones to be up in the air.
Check the legality of your contract
If a recruitment agency was involved at the start of your relationship with your client, nine times out of ten there will be a restriction in the original freelancer-agency contract preventing you from working with the client independently of the agency – at least for a certain period of time.
In these circumstances, it’s best to seek independent legal advice to ensure that your retainer is above board.
Propose a trial period
If you’re not totally sold on the idea of working on a retained basis, why not suggest a trial period?
This way, you and your client can take the time needed to work out if this arrangement really floats your boats.
Is a retainer the holy grail of freelancing?
Having a single retainer in place isn’t a remedy for all your freelance woes, but it sure beats being on the treadmill of having to bag new clients to get you from month-to-month.
But, by having several clients on retainer, you diversify your income while freeing up time to do things other than trawl job boards.