Project Fee or Retainer in the Agency - Stable Partnership or Flexible Adventure?
Imagine your dream customer: A client who brings exciting projects to the table. Who recognises how crucial a strong advertising strategy is for business success. Who has clear goals. Your dream client is willing to invest in innovative & creative campaigns and break new ground to stand out from the competition. But there is still one essential point missing from the checklist for a dream client: a long-term partnership based on trust and reliability on both sides.
A retainer agreement with the agency brings stability and long-term business relationships. This article explains the advantages of a retainer for agencies compared to short-term project work, which billing models are common for retainer contracts and which smart retainer functions the agency software LEADING Job has to offer.
What Is Project Work?
Project work is a flexible and widespread method in agency relationships. An individual quotation is drawn up for each project and invoiced on completion of the project. This is particularly suitable for one-off or short-term orders.
Project work is usually invoiced on a monthly basis according to time and effort. The agency provides the client with a detailed list of the hours and materials worked, which are then remunerated accordingly.
What are the advantages of project work?
Project work offers the advantage of flexibility. Clients can utilise exactly the services they need for a specific project without making long-term commitments. They can also precisely control costs and only pay for services actually provided.
What Is a Retainer Agency Contract?
A retainer contract is an agreement between the agency and the client under which the agency provides continuous services for a fixed period of time. The client pays a regular fee for this, regardless of the actual work performed. Agency retainer terms vary from a few months to long-term contracts of more than a year, depending on the client's specific needs. These contracts often include cancellation terms with notice periods of 30 to 90 days.
What Are the Advantages of Retainers for the Agency?
- Plannable budgets & income: With retainer contracts, you can plan your income and expenses long-term. This type of contract creates a reliable source of income, enabling your agency to achieve financial stability and minimize costly individual projects.
- Plannable capacities: Thanks to a retainer contract, you can better allocate your capacities and ensure that enough staff is available for ongoing projects.
- Less acquisition effort: A retainer contract significantly reduces acquisition effort. Instead of constantly seeking new projects, you can focus on continuous collaboration with existing clients.
- Continuous optimization: Retainer contracts promote close collaboration and allow your agency to gain deeper insights into your clients' needs. This leads to better and more targeted support, which supports the strategic growth of your clients.
- Easier budget management: A retainer contract facilitates budget management for both you and the client. Fixed monthly costs allow for clear financial planning.
- Prioritized availability and long-term partnership: With a retainer contract, your clients enjoy prioritized availability and faster processing of their requests. This strengthens customer loyalty and fosters a long-term partnership.
How Do You Invoice Retainers?
Retainer agreements are usually invoiced on a monthly basis. The customer pays a fixed amount each month based on the agreed working hours or the services to be provided. The agency regularly presents the customer with an overview of the completed tasks and the time spent in order to create transparency and show how the retainer is being utilised.
If the client requires additional services that go beyond the agreed scope, these are invoiced separately. There are often clear rules in the contract as to how such additional work is charged. The retainer amount is regularly reviewed and adjusted if the customer's needs change; these reviews may take place quarterly or every six months.
The contract will specify exactly which services are included in the retainer to avoid misunderstandings. These can include social media management, SEO, content creation or general marketing consulting, for example. This structure keeps billing simple and transparent, both for the agency and for the client.
LEADING Job's Smart Retainer Features
The LEADING Job agency software helps agencies to manage retainers easily and efficiently:
- Automated invoicing: LEADING Job creates monthly invoices for the agreed retainer amount and sends them directly to the client.
- Time recording and service documentation: The software records exactly how much time is spent on each client and which services are provided, broken down into every detail. This keeps everything transparent and traceable for the customer.
- Budget control: LEADING Job helps you to keep an eye on the budget for each customer. It issues early warnings if the budget is running low or changes are required.
- Reports and analyses: The software creates detailed reports on the services provided. These help to show the value of the retainer and analyse the agency's work.
- Contract management: LEADING Job organises contract terms and durations. It reminds of contract reviews and ensures that all terms and conditions are adhered to.
- Communication and collaboration: The software provides tools for easy communication and collaboration with clients.
With the retainer features of LEADING Job, you can create for example a comprehensive communications calendar for a client. Flat-rate services such as four articles in a specialised magazine, one podcast per quarter, a crisis PR seminar and 30 hours of social media support per month are included in our example. These total services are converted into estimated hours and external costs, divided into equal monthly retainer instalments and invoiced. Special services that exceed the retainer are added at the end of the month. Thanks to the fixed budget commitment, LEADING Job allows you to plan capacities efficiently and offer more favourable hourly rates, while additional consultant hours are billed at the regular hourly rate.
Best Retainer Agency Software - Get in touch now
Want to discover the benefits of efficient retainer management? Make an appointment for a demo today and see how LEADING Job can support your agency.
