The two numbers to watch
A retainer is priced on an assumption: this much work, for this fee. Two figures show whether the assumption still holds.
- Effective hourly rate = monthly fee ÷ hours worked for the client that month.
- Retainer margin = (monthly fee − delivery cost) ÷ monthly fee, where delivery cost is hours × each person’s hourly cost, plus direct expenses.
If the effective rate falls below the rate you would quote for the same work by the hour, the scope has grown faster than the fee.
A worked example
An example, not customer data. A client pays $4,000 a month for social media management, priced on 50 hours. In March the team logs 64 hours.
- Effective hourly rate: $4,000 ÷ 64 = $62.50, against the $80 the fee assumed ($4,000 ÷ 50).
- Delivery cost at a $38 average loaded cost: 64 × $38 = $2,432, plus $150 of stock images = $2,582.
- Retainer margin: ($4,000 − $2,582) ÷ $4,000 = 35%. At 50 hours it would have been 49%.
The 14 extra hours cost 14 points of margin. That is the conversation to have with the client, with the hours in hand.
How PLYNTUM handles retainers
On every plan, a client can carry a monthly retainer fee, which creates an expected payment each month, and monthly deliverables (for example 12 posts, each with an estimated time), which create the month’s tasks automatically. Hours logged on the client’s work are recorded against the retainer.
From Core, a recurring invoice creates the monthly invoice record on schedule and notifies you in the app; it is not emailed automatically. The client portal shows the client the active retainer, deliverables, invoices, payments and balance. From Scale, renewal workflows create tasks 90, 60 and 30 days before the renewal date.
PLYNTUM does not track included hours, overage or rollover. You compare the hours with the fee yourself and decide what to bill. See marketing agency software and the retainer agreement template.
See also the hourly rate calculator, delivery cost, unbilled work and all terms in the glossary.