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Re: Hourly Vs. Retainer?

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  • miked918
    I would echo that point a bit. Yes, there are benefits for the agency for a monthly retainer. But, for any ethical, fair agency person, you definitely do your
    Message 1 of 21 , Dec 6, 2004
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      I would echo that point a bit. Yes, there are benefits for the agency
      for a monthly retainer.
      But, for any ethical, fair agency person, you definitely do your best
      to ensure that the client is getting its benefit from the fee.
      Otherwise, it'll be gone at the end of the contract, and with a
      bitter taste in the client's mouth for such an arrangement.

      With monthly fees, I give monthly or quarterly reports on the
      projects applied to the fee, as well as the editorial coverage (my
      emphasis is in media relations).

      My company has a client that has a monthly retainer fee for all work,
      other than outside costs. It's early still, but the client like it
      because of the fewer invoices it receives. And, we do provide a
      monthly status report, with what's been billed and what we've done
      for each project.

      Granted, early on, the marketing and others people we deal with
      weren't sure how it worked, so they didn't use us. We can only be
      proactive so much. In the recent couple or so months, we're tracking
      pretty good.

      Mike
      _____________________________________
      Michael Driehorst
      Media Relations Manager
      Maumee, Ohio 43537-4043 U.S.A.



      --- In prbytes@yahoogroups.com, Dennis Bailey <dbailey1@m...> wrote:
      >
      > Well, I disagree. I give all my clients a work plan with specified
      > deliverables, along with a bill for a monthly retainer based on
      > estimated hours. I'm always willing to listen to a client and
      > re-negotiate if he or she feels I didn't do the work that was
      required
      > of me in any given month. And my contract specifies that if a
      project
      > requires extraordinary hours beyond what is included in the
      retainer, I
      > will bill the client on an hourly basis over and above the retainer
      > amount, or stop work for the month and pick it up in next month's
      > retainer. It's the client's discretion. Anyway, I'm free to be
      > "creative and proactive" on the project - since the more work I put
      in,
      > the more money I'll get - rather than being "creative and
      proactive" on
      > padding the hours. I've never seen a client save money by
      requesting an
      > hourly rate.
      >
      >
      >
      >
      >
    • Ned Barnett
      I think it s all a matter of how you do business, Dennis. I prefer hourly rates to retainers - retainers tend to have me doing more work for less money - with
      Message 2 of 21 , Dec 6, 2004
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        I think it's all a matter of how you do business, Dennis. I prefer hourly
        rates to retainers - retainers tend to have me doing more work for less
        money - with hourly, clients pay for what they get - no more, no
        less. That makes sense.

        When I have hourly clients, they commit to a minimum number of hours per
        month, and pay for that up front. If they don't use the hours budgeted, I
        roll them over. If they exceed the hours (by more than 10%) then they pay
        extra - but first, they decide to either keep going and pay more, or wait
        until the start of the next month.

        They have choices - and properly trained, clients prefer choices.

        At 06:02 PM 12/3/2004, you wrote:


        >I hate hourly rates. You just can't budget for them. To be honest, I
        >tell clients who want hourly rates that it's not a good deal. For one
        >thing, my hourly clients tend to get shoved to the bottom of the pile,
        >I'll do it when I can get to it. While my clients on retainer know
        >what's expected, and I know what's expected of me month to month.

        What if they want more services than you feel the retainer is worth? How
        do you deal with that without pissing them off?


        >Plus, I never want my client not to call me because he thinks I'll
        >charge him for the call. For a monthly retainer, where I can estimate
        >the hours involved and expect a certain rate, a client can call me
        >virtually any time and it's included in the retainer. If I agree to an
        >hourly rate, I'll charge the client for the time I spend in my car
        >thinking about their case and they'll probably end up paying more.

        Right now I have two retainer clients - for one of them, the work has
        already exceeded what I think is reasonable for the retainer. Fortunately,
        so does the client, so I'll have no big problem arranging for an equitable
        adjustment this month. The other, I've laid out very specific duties for
        the retainer (actually, three sets of different "deliverables") - and the
        client knows that anything beyond one of those three sets of deliverables
        becomes billable. They're new at this, so preferred the retainer. Over
        time, I expect them to want to convert to hourly - we'll see.


        >Another thing: I don't know about you, but I've been doing this long
        >enough that I have established good contacts in government, the media
        >and the business world. My client might want me to make a call to
        >someone in the governor's office, for example. I'm in a position where
        >they'll take my call, listen to me and even agree to a meeting if my
        >client requests it. The call itself might only take 10 minutes. But
        >let's face it, not everyone can get that kind of service, and it's just
        >not fair to me to charge an hourly rate for the call. What would it be?
        >Thirty-five bucks? When clients hire you, they hire your rolodex, your
        >experience, your contacts, and they should pay for that.

        That should be built into your hourly. Sometimes you'll take a lot of time
        to do something mundane (last night, I spent 7 hours constructing a media
        list for California business media). Sometimes a single call will do wonders.

        If all you do is make the high-end calls, then a retainer is worth it. I
        once paid an ex-Congressman $25,000 to solve a problem - he solved it in
        under 10 minutes, with one phone call (I was there, watching as he did it)
        - and I was damned glad to pay him that $25,000, as it gave me the chance
        to try to save a multi-million dollar project from ruin. (Meeting with a
        guy who was - at the time, though I didn't know it - hiding from a Federal
        indictment as I met with him was another story, one right out of the
        Godfather, but it's hardly germane to this story).


        >Not sure these arguments will convince a client to go to a retainer,
        >but it's my experience that clients generally make out better with a
        >retainer. They can budget for it, you can budget your time better, and
        >there are no surprises.

        I find that clients make out better (and so do agencies) when the client
        pays for exactly what s/he gets, no more and no less. But your size may vary.

        Ned


        >Hope this helps.
        >
        >Dennis
        >
        >On Dec 3, 2004, at 9:20 AM, detour3 wrote:
        >
        >
        > I have a new prospective client that wants to buy hourly rates
        > instead of a retainer. What reasons would you give a client why a
        > retainer is better for them and why hourly services are not a good
        > option for them?
        >
        >
        >
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      • Ned Barnett
        ... David, I guess that depends on how you define a retainer. Mine are defined as up to X hours of professional services in exchange for Y dollars per
        Message 3 of 21 , Dec 6, 2004
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          At 09:47 PM 12/4/2004, you wrote:
          >This is somewhat of a self-righteous argument. The reality is that the
          >retainer is loaded in favour of the consultant/agency because it gives
          >them the comfort of a positive cash flow even if they do not undertake any
          >client work during the month. The retainer is also a bad deal for clients
          >because it removes the need for the consultant/agency to be creative and
          >proactive on their behalf.
          >
          >David Davis
          >www.askdd.com


          David, I guess that depends on how you define a retainer.

          Mine are "defined" as "up to X hours of professional services in exchange
          for Y dollars per month" - if they go more than 10% under, I roll over the
          hours; if they go more than 10% over, they pay for the extra service.

          I get the advantage of up-front monthly money I can count on, yet my client
          loses nothing. It's up to me to make sure the work is at least within 10%
          of the promised amount - and if they need more (often they do, and they
          drive the demand), they're glad to pay more. But they can wait till next
          month if they want.

          Ned


          >callawebdesign@... wrote:
          >
          >
          >I totally agree. I have all my clients on retainer and none of them have a
          >problem with it. It helps you and the client budget each month, and very
          >true...they don't have to worry about everything being a charge. Plus,
          >they can never
          >second guess you on the bill if you charge for 50 hours and they believe you
          >should only be charging for around 20-30. No surprises... very true. The only
          >thing additional I charge for is supplies. They pay for printing, postage,
          >etc. And even that is quoted to them before the project ever gets started.
          >Anyone
          >serious about hiring you, shouldn't have a problem understanding the benefits
          >to them as well as you.
          >
          >~
          >
          >
          >Laura Alber
          >12505 W. Jefferson Blvd.
          >Unit 301
          >Los Angeles, CA. 90066
          >phone/voice 310-822-1627
          >press@...
          >callawebdesign@...
          >Laura@...
          >
          ><http://www.ez-entertainment.net>http://www.ez-entertainment.net
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          >David Davis
          >Founder
          >
          >Why not visit the new-look Mediabuddies - media industry's worldwide
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          >
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          ><http://www.mediabuddies.com/>http://www.mediabuddies.com/
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        • Shediac Communications Ltd
          Dear All, As many on this list know, I recently went into retirement, but keep up with industry opinion. It has been our experience, in Hong Kong and China,
          Message 4 of 21 , Dec 7, 2004
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            Dear All,

            As many on this list know, I recently went into retirement, but
            keep up with industry opinion.

            It has been our experience, in Hong Kong and China, that hourly
            rates do not work unless you submit a time sheet and invoice
            weekly. This is to avoid someone in the principle's office
            stating that he/she could have found a less expensive supplier
            after the task has reached fruition and a lump sum invoice
            presented.

            Additionally, hourly principles (we refer to clients as
            principles) tend to wait until the very last minute before
            assigning a task, which often leads to a PR consultancy
            producing less than its best (the "garbage-in, garbage-out"
            syndrome). Hourly principals also upset internal scheduling for
            retainer principles.

            We have found that most Asian organizations welcome a monthly
            retainer, in that it ensures the PR effort is ongoing. It
            embeds the PR consultancy to the principle in a side-by-side
            relationship, so that both are prepared and in sync when it
            comes to certain critical PR tasks, such as crises
            communication.

            My consultancy offers principles 36 hours a month of our time,
            and we bill extra for hours exceeding 36. Obviously, we do not
            sit by a clock for all tasks. For example, most of our
            principles have very few tasks in the months of December and
            February (Lunar New Year holiday), so in November and January we
            do not levy overtime as we appreciate principles will not have
            much for us to do in Dec/Feb.

            Please remember the above is written from the Asian perspective.

            Frank Mark Shediac
            (Hong Kong Goodwill Ambassador 1999-2004)
            Managing Director
            Shediac Communications Limited<>Founded in Hong Kong, June 1976
            Cell Phone: (852) 6056 6271
            mailto:fshediac@...


            ======REPLY SEPARATOR=======

            On Sun, 5 Dec 2004 05:47:43 +0000 (GMT), albiondd@...,
            wrote:

            This is somewhat of a self-righteous argument. The reality is
            that the retainer is loaded in favour of the consultant/agency
            because it gives them the comfort of a positive cash flow even
            if they do not undertake any client work during the month. The
            retainer is also a bad deal for clients because it removes the
            need for the consultant/agency to be creative and proactive on
            their behalf.

            David Davis
            www.askdd.com

            callawebdesign@... wrote:


            I totally agree. I have all my clients on retainer and none of
            them have a
            problem with it. It helps you and the client budget each month,
            and very
            true...they don't have to worry about everything being a charge.
            Plus, they can never
            second guess you on the bill if you charge for 50 hours and they
            believe you
            should only be charging for around 20-30. No surprises... very
            true. The only
            thing additional I charge for is supplies. They pay for
            printing, postage,
            etc. And even that is quoted to them before the project ever
            gets started. Anyone
            serious about hiring you, shouldn't have a problem understanding
            the benefits
            to them as well as you.

            ~


            Laura Alber
            12505 W. Jefferson Blvd.
            Unit 301
            Los Angeles, CA. 90066
            phone/voice 310-822-1627
            press@...
            callawebdesign@...
            Laura@...

            http://www.ez-entertainment.net


            [Non-text portions of this message have been removed]








            Yahoo! Groups Links










            David Davis
            Founder

            Why not visit the new-look Mediabuddies - media industry's
            worldwide reunion club?


            http://www.mediabuddies.com/

























            [Non-text portions of this message have been removed]



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          • Shediac Communications Ltd
            MY APOLOGIES--THERE WERE MISSPELLINGS IN MY FIRST MAIL Dear All As many on this list know, I recently went into retirement, but keep up with industry opinion.
            Message 5 of 21 , Dec 7, 2004
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              MY APOLOGIES--THERE WERE MISSPELLINGS IN MY FIRST MAIL

              Dear All

              As many on this list know, I recently went into retirement, but
              keep up with industry opinion.

              It has been our experience, in Hong Kong and China, that hourly
              rates do not work unless you submit a time sheet and invoice
              weekly. This is to avoid someone in the principal's office
              stating that he/she could have found a less expensive supplier
              after the task has reached fruition and a lump sum invoice
              presented.

              Additionally, hourly principals (we refer to clients as
              principals) tend to wait until the very last minute before
              assigning a task, which often leads to a PR consultancy
              producing less than its best (the "garbage-in, garbage-out"
              syndrome). Hourly principals also upset internal scheduling for
              retainer principles.

              We have found that most Asian organizations welcome a monthly
              retainer, in that it ensures the PR effort is ongoing. It
              embeds the PR consultancy to the principle in a side-by-side
              relationship, so that both are prepared and in sync when it
              comes to certain critical PR tasks, such as crises
              communication.

              My consultancy offers principles 36 hours a month of our time,
              and we bill extra for hours exceeding 36. Obviously, we do not
              sit by a clock for all tasks. For example, most of our
              principles have very few tasks in the months of December and
              February (Lunar New Year holiday), so in November and January we
              do not levy overtime as we appreciate principles will not have
              much for us to do in Dec/Feb.

              Please remember the above is written from the Asian perspective.

              Frank Mark Shediac
              (Hong Kong Goodwill Ambassador 1999-2004)
              Managing Director
              Shediac Communications Limited<>Founded in Hong Kong, June 1976
              Cell Phone: (852) 6056 6271
              mailto:fshediac@...
            • Duncan Matheson
              Kezia wrote ... Whoa, hold on dar just one dang blam minute. I guess I m like one of those livestock-stealing monsters you describe, but you ve got it wrong,
              Message 6 of 21 , Dec 7, 2004
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                Kezia wrote
                > If there's anyone on this listserv who meets that description -
                > charging a client for work that is not performed - we should chase
                > them like illiterate villagers going after a livestock-stealing
                > monster and stone them to death. Unsophisticated clients may think
                > that's true, but they're very, very wrong.

                Whoa, hold on dar just one dang blam minute. I guess I'm like one of those
                livestock-stealing monsters you describe, but you've got it wrong, in that
                there is nothing unethical about this practise, which if I am reading you
                right, is what you are trying to suggest. When a client hires us on
                retainer, he's buying our availability. Whether he decides to use it is up
                to him, but he pays either way, and fully understands this going in. Keep in
                mind this is time we would otherwise have booked to do other billable work,
                so why shouldn't we.

                This doesn't happen often, but it happens. I'll give you one example from a
                couple of months ago. An organization was concerned that an expected
                government decision may go against their interests, and if it did, they
                wanted to be able to counter this and try to get it reversed. There was only
                a minimal amount of work that could be done in advance, but if it occurred
                they were going to need a considerable amount of our time. They knew they if
                they waited until they knew for sure that they needed us, we might not be
                available, so they booked us. Knowing we would be available if needed was
                important to them, and to their mind, a worthwhile expense. As it turned
                out, we weren't needed, and they gladly paid the bill. So for this, you
                would have us chased out of the village?
                >
                > If a company wants to kick the tires before committing to a retainer
                > agreement, find out what they're going to expect beforehand - you
                > may not want their business.

                Maybe not, but I have to disagree with you on this too. The majority of
                retainer clients we have ever had didn't start out as retainer clients. They
                first hired us for projects, then switched over to retainer. This is because
                they became comfortable with us. I think for many clients, expecting them to
                make a commitment to a retainer arrangement when they don't know you or your
                work very well may be asking too much.

                Duncan
              • kezia_jauron
                Duncan - thanks for the examples you mention. I got the impression from David s post that a retainer should allow us to live a cushy lifestyle on a client s
                Message 7 of 21 , Dec 7, 2004
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                  Duncan - thanks for the examples you mention. I got the impression from
                  David's post that a retainer should allow us to live a cushy lifestyle on a
                  client's dime without doing any work. Sorry if that was not the implication.
                  Everyone undertakes research projects and writes drafts of news releases - or
                  otherwise lays a firm groundwork - for projects that never come to fruition.
                  Yeah. What a waste. What can ya do?

                  For us - we're a big player, but in a niche industry - new clients are well aware
                  of our capabilities and/or reputation coming in. Many client marketing people
                  have already worked with us at an earlier job, or have been referred to us by
                  analysts, editors, or VC firms. They don't have the excuse of not knowing
                  enough about us to make a committment. (Don't your prospects check
                  references? Shouldn't they KNOW walking in what a superstar you are??)

                  If you've had client relationships that began from a place of doubt but turned
                  out to be successful, you've been fortunate enough to work for great clients. In
                  my life so far, these situations have meant real whiners who want something
                  for nothing and are never satisfied. Just beware of non-hatching chicks.

                  Kezia
                  Who can't seem to shake the barnyard metaphors
                • Jimmy Vo
                  I know this is an old thread, started back in December 2004, but I m confused. When I use monthly retainers, I bill my hourly rate against the retainer. What I
                  Message 8 of 21 , Jul 28, 2005
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                    I know this is an old thread, started back in December 2004, but I'm
                    confused.

                    When I use monthly retainers, I bill my hourly rate against the
                    retainer. What I don't use of the retainer gets carried over. I never
                    bill and keep fees for unperformed work, but if addtional work that
                    surpass the retainer is needed, the client has the option of paying
                    more the additional fees, or wait until next month.

                    QUESTIONS:
                    1) You mean some of you keep the retainer regardless, even for work
                    that's not performed? IS THIS NORMAL FOR THE INDUSTRY?

                    2) If you DO keep the extra money from the retainer -- How do you
                    manage to not do enough work? There's always work. Research research
                    research, coming up with new ideas, refining, give value to the
                    client and go beyond what's expected, draft edit draft more editing,
                    etc.

                    I also provide my clients with monthly statements detailing services
                    that were performed. You mean this isn't normal procedure?

                    -Jimmy Vo-





                    Kezia wrote
                    > If there's anyone on this listserv who meets that description -
                    > charging a client for work that is not performed - we should chase
                    > them like illiterate villagers going after a livestock-stealing
                    > monster and stone them to death. Unsophisticated clients may think
                    > that's true, but they're very, very wrong.

                    Whoa, hold on dar just one dang blam minute. I guess I'm like one of
                    those
                    livestock-stealing monsters you describe, but you've got it wrong, in
                    that
                    there is nothing unethical about this practise, which if I am reading
                    you
                    right, is what you are trying to suggest. When a client hires us on
                    retainer, he's buying our availability. Whether he decides to use it
                    is up
                    to him, but he pays either way, and fully understands this going in.
                    Keep in
                    mind this is time we would otherwise have booked to do other billable
                    work,
                    so why shouldn't we.

                    This doesn't happen often, but it happens. I'll give you one example
                    from a
                    couple of months ago. An organization was concerned that an expected
                    government decision may go against their interests, and if it did,
                    they
                    wanted to be able to counter this and try to get it reversed. There
                    was only
                    a minimal amount of work that could be done in advance, but if it
                    occurred
                    they were going to need a considerable amount of our time. They knew
                    they if
                    they waited until they knew for sure that they needed us, we might
                    not be
                    available, so they booked us. Knowing we would be available if needed
                    was
                    important to them, and to their mind, a worthwhile expense. As it
                    turned
                    out, we weren't needed, and they gladly paid the bill. So for this,
                    you
                    would have us chased out of the village?
                    >
                    > If a company wants to kick the tires before committing to a retainer
                    > agreement, find out what they're going to expect beforehand - you
                    > may not want their business.

                    Maybe not, but I have to disagree with you on this too. The majority
                    of
                    retainer clients we have ever had didn't start out as retainer
                    clients. They
                    first hired us for projects, then switched over to retainer. This is
                    because
                    they became comfortable with us. I think for many clients, expecting
                    them to
                    make a commitment to a retainer arrangement when they don't know you
                    or your
                    work very well may be asking too much.

                    Duncan
                  • Geri Wilson
                    hi jimmy - i don t know what s normal in the industry, but i can tell you what i do. as a boutique marketing communications firm, which means i m a
                    Message 9 of 21 , Jul 29, 2005
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                      hi jimmy -
                      i don't know what's "normal" in the industry, but i can tell you what i do. as a "boutique marketing communications firm," which means i'm a one-person shop (sometimes hiring extra help as needed), i provide personal service that the bigger shops don't provide.

                      in all honesty, my clients would die if they ever saw an hourly bill of what i do for them, and, to be honest, i hate keeping track of my time like that. so they pay me an hourly rate and i become their "in-house" marketing communication professional. every year we write a marketing communications plan, which is modified as we go as the market and their needs require, and i am basically available to fulfill their needs.

                      i'm sure i'd make more money hourly, but this way they feel secure with me, there are never surprises for me or them about the bill, and they don't resent their bill when it goes high, even though they require it. it also keeps the paperwork down, which is, after all, one of the reasons i went into this form of the business -- i hate the business end.

                      just one old pro's way. . .
                      best -
                      geri wilson
                      the jonathan group
                      - strategic marketing communications -

                      Jimmy Vo <jimmy@...> wrote:
                      I know this is an old thread, started back in December 2004, but I'm
                      confused.

                      When I use monthly retainers, I bill my hourly rate against the
                      retainer. What I don't use of the retainer gets carried over. I never
                      bill and keep fees for unperformed work, but if addtional work that
                      surpass the retainer is needed, the client has the option of paying
                      more the additional fees, or wait until next month.

                      QUESTIONS:
                      1) You mean some of you keep the retainer regardless, even for work
                      that's not performed? IS THIS NORMAL FOR THE INDUSTRY?

                      2) If you DO keep the extra money from the retainer -- How do you
                      manage to not do enough work? There's always work. Research research
                      research, coming up with new ideas, refining, give value to the
                      client and go beyond what's expected, draft edit draft more editing,
                      etc.

                      I also provide my clients with monthly statements detailing services
                      that were performed. You mean this isn't normal procedure?

                      -Jimmy Vo-





                      Kezia wrote
                      > If there's anyone on this listserv who meets that description -
                      > charging a client for work that is not performed - we should chase
                      > them like illiterate villagers going after a livestock-stealing
                      > monster and stone them to death. Unsophisticated clients may think
                      > that's true, but they're very, very wrong.

                      Whoa, hold on dar just one dang blam minute. I guess I'm like one of
                      those
                      livestock-stealing monsters you describe, but you've got it wrong, in
                      that
                      there is nothing unethical about this practise, which if I am reading
                      you
                      right, is what you are trying to suggest. When a client hires us on
                      retainer, he's buying our availability. Whether he decides to use it
                      is up
                      to him, but he pays either way, and fully understands this going in.
                      Keep in
                      mind this is time we would otherwise have booked to do other billable
                      work,
                      so why shouldn't we.

                      This doesn't happen often, but it happens. I'll give you one example
                      from a
                      couple of months ago. An organization was concerned that an expected
                      government decision may go against their interests, and if it did,
                      they
                      wanted to be able to counter this and try to get it reversed. There
                      was only
                      a minimal amount of work that could be done in advance, but if it
                      occurred
                      they were going to need a considerable amount of our time. They knew
                      they if
                      they waited until they knew for sure that they needed us, we might
                      not be
                      available, so they booked us. Knowing we would be available if needed
                      was
                      important to them, and to their mind, a worthwhile expense. As it
                      turned
                      out, we weren't needed, and they gladly paid the bill. So for this,
                      you
                      would have us chased out of the village?
                      >
                      > If a company wants to kick the tires before committing to a retainer
                      > agreement, find out what they're going to expect beforehand - you
                      > may not want their business.

                      Maybe not, but I have to disagree with you on this too. The majority
                      of
                      retainer clients we have ever had didn't start out as retainer
                      clients. They
                      first hired us for projects, then switched over to retainer. This is
                      because
                      they became comfortable with us. I think for many clients, expecting
                      them to
                      make a commitment to a retainer arrangement when they don't know you
                      or your
                      work very well may be asking too much.

                      Duncan





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                    • Bob Reed
                      Jimmy, From my perspective, you re use of retainers is correct. It s the average of what the client will pay over the course of a yearly program, with peaks
                      Message 10 of 21 , Jul 29, 2005
                      • 0 Attachment
                        Jimmy,

                        From my perspective, you're use of retainers is correct. It's the average
                        of what the client will pay over the course of a yearly program, with peaks
                        and valleys in activity.

                        On the other hand, some agencies view the retainer as a placeholder, which
                        give the client the right to instant availability and use of the agency's
                        time and talent.

                        What's normal is what the client will accept and tolerate in relation to
                        perceived value.

                        Bob Reed

                        -----Original Message-----
                        From: prbytes@yahoogroups.com [mailto:prbytes@yahoogroups.com] On Behalf Of
                        Jimmy Vo
                        Sent: Thursday, July 28, 2005 4:32 PM
                        To: prbytes@yahoogroups.com
                        Subject: [prbytes] Re: Hourly Vs. Retainer? Isn't it the same?

                        I know this is an old thread, started back in December 2004, but I'm
                        confused.

                        When I use monthly retainers, I bill my hourly rate against the
                        retainer. What I don't use of the retainer gets carried over. I never
                        bill and keep fees for unperformed work, but if addtional work that
                        surpass the retainer is needed, the client has the option of paying
                        more the additional fees, or wait until next month.

                        QUESTIONS:
                        1) You mean some of you keep the retainer regardless, even for work
                        that's not performed? IS THIS NORMAL FOR THE INDUSTRY?

                        2) If you DO keep the extra money from the retainer -- How do you
                        manage to not do enough work? There's always work. Research research
                        research, coming up with new ideas, refining, give value to the
                        client and go beyond what's expected, draft edit draft more editing,
                        etc.

                        I also provide my clients with monthly statements detailing services
                        that were performed. You mean this isn't normal procedure?

                        -Jimmy Vo-





                        Kezia wrote
                        > If there's anyone on this listserv who meets that description -
                        > charging a client for work that is not performed - we should chase
                        > them like illiterate villagers going after a livestock-stealing
                        > monster and stone them to death. Unsophisticated clients may think
                        > that's true, but they're very, very wrong.

                        Whoa, hold on dar just one dang blam minute. I guess I'm like one of
                        those
                        livestock-stealing monsters you describe, but you've got it wrong, in
                        that
                        there is nothing unethical about this practise, which if I am reading
                        you
                        right, is what you are trying to suggest. When a client hires us on
                        retainer, he's buying our availability. Whether he decides to use it
                        is up
                        to him, but he pays either way, and fully understands this going in.
                        Keep in
                        mind this is time we would otherwise have booked to do other billable
                        work,
                        so why shouldn't we.

                        This doesn't happen often, but it happens. I'll give you one example
                        from a
                        couple of months ago. An organization was concerned that an expected
                        government decision may go against their interests, and if it did,
                        they
                        wanted to be able to counter this and try to get it reversed. There
                        was only
                        a minimal amount of work that could be done in advance, but if it
                        occurred
                        they were going to need a considerable amount of our time. They knew
                        they if
                        they waited until they knew for sure that they needed us, we might
                        not be
                        available, so they booked us. Knowing we would be available if needed
                        was
                        important to them, and to their mind, a worthwhile expense. As it
                        turned
                        out, we weren't needed, and they gladly paid the bill. So for this,
                        you
                        would have us chased out of the village?
                        >
                        > If a company wants to kick the tires before committing to a retainer
                        > agreement, find out what they're going to expect beforehand - you
                        > may not want their business.

                        Maybe not, but I have to disagree with you on this too. The majority
                        of
                        retainer clients we have ever had didn't start out as retainer
                        clients. They
                        first hired us for projects, then switched over to retainer. This is
                        because
                        they became comfortable with us. I think for many clients, expecting
                        them to
                        make a commitment to a retainer arrangement when they don't know you
                        or your
                        work very well may be asking too much.

                        Duncan







                        Yahoo! Groups Links
                      • kezia_jauron
                        The point I was making was in response to David s statement here: The reality is that the retainer is loaded in favour of the consultant/agency because it
                        Message 11 of 21 , Aug 1, 2005
                        • 0 Attachment
                          The point I was making was in response to David's statement here:

                          "The reality is that the retainer is loaded in favour of the
                          consultant/agency because it gives them the comfort of a positive
                          cash flow even if they do not undertake any client work during the
                          month. The retainer is also a bad deal for clients because it
                          removes the need for the consultant/agency to be creative and
                          proactive on their behalf."

                          Which I disagreed with, but apparently only the "chase them like
                          illiterate villagers" portion of my comments had any legs. I can't
                          imagine there would be practitioners in our business who would do NO
                          work for a MONTH for a retainer client. Those are the bad guys,
                          folks - not anyone in present company.

                          I admire anyone who has the time and stamina to maintain hourly
                          against retainer billing records. My agency does not do this for
                          retainer clients. (My boss would probably be a lot richer if we
                          did.)

                          Again, I can only speak personally, but in a month where a client
                          may think "no work is being performed," I agree with you, Jimmy. How
                          is this possible?

                          For example, our retainer agreement allows for the writing and
                          distribution of two news releases a month. Some companies just don't
                          have two newsworthy developments in a month, so they might think
                          they'll get a break on the bill. Wrong. It takes much more effort
                          and time to get press for a company that isn't doing anything
                          noteworthy, doesn't it?

                          And aren't you also:

                          - Updating your editorial database
                          - Maintaining the relationships you trade on
                          - Monitoring editorial coverage, competitive coverage, and industry
                          happenings
                          - Checking editorial calendars for future opps and creating new ones
                          - Laying groundwork for future projects (i.e. racking your brain for
                          ways to keep an inactive or sporadically active client in the news)

                          As Duncan mentioned at one point, your client's failure to take
                          advantage of all the PR services/resources available to them isn't
                          your fault, and you shouldn't be financially penalized for it. But
                          it sounds like you know how to make the distinction between hours
                          YOU didn't devote to their account and opportunities THEY failed to
                          leverage, and I'll bet your clients value your fairness and accuracy
                          when they're writing your checks. Normal or not, whatever you're
                          doing, keep doing it.

                          For the reasons I disagreed that a retainer agreement is always more
                          financially advantageous to the agency than the client, read the
                          rest of the original message here:
                          http://finance.groups.yahoo.com/group/prbytes/message/2895

                          In fact, I'm going through an 'abuse period' now with a retainer
                          client that moved around some staff, and I have a new day-to-day
                          contact who needs incredibly intense handholding as well as
                          massively detailed reports. They're getting their money's worth and
                          then some.




                          --- In prbytes@yahoogroups.com, "Jimmy Vo" <jimmy@n...> wrote:
                          > I know this is an old thread, started back in December 2004, but
                          I'm
                          > confused.
                          >
                          > When I use monthly retainers, I bill my hourly rate against the
                          > retainer. What I don't use of the retainer gets carried over. I
                          never
                          > bill and keep fees for unperformed work, but if addtional work
                          that
                          > surpass the retainer is needed, the client has the option of
                          paying
                          > more the additional fees, or wait until next month.
                          >
                          > QUESTIONS:
                          > 1) You mean some of you keep the retainer regardless, even for
                          work
                          > that's not performed? IS THIS NORMAL FOR THE INDUSTRY?
                          >
                          > 2) If you DO keep the extra money from the retainer -- How do you
                          > manage to not do enough work? There's always work. Research
                          research
                          > research, coming up with new ideas, refining, give value to the
                          > client and go beyond what's expected, draft edit draft more
                          editing,
                          > etc.
                          >
                          > I also provide my clients with monthly statements detailing
                          services
                          > that were performed. You mean this isn't normal procedure?
                        • kezia_jauron
                          Say you ve set up an opportunity for a client - got them included in a newspaper review of the city s best dog groomers or something. Because you re so
                          Message 12 of 21 , Aug 1, 2005
                          • 0 Attachment
                            Say you've set up an opportunity for a client - got them included in
                            a newspaper review of 'the city's best dog groomers' or something.

                            Because you're so chummy with the editor and so familiar with the
                            dog grooming biz - in other words, because you are so good at what
                            you do - it only took a 4-minute phone call to set up that
                            opportunity.

                            How would you bill this? And doesn't this kind of thing happen to
                            you all the time?

                            If you weren't as good at this stuff, and didn't have the contacts
                            you have, that task may have taken you hours. And I assume you don't
                            bill them for the months or years it took to cultivate the
                            relationships and build the knowledge of the industry that led you
                            to be able to pull it off in 4 minutes.

                            (When clients ask for "their" "mail list," I'm always tempted to
                            tell them they can have it at our cost: $260,000. This is a rough
                            estimate of what we've spent building it over the last 13 years
                            based on a low-level, full-time staff person's annual salary, times
                            13 years.)
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