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Re: Hourly Vs. Retainer? Isn't it the same?

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  • 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 1 of 21 , Aug 1 12:50 PM
      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

      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
      - 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:

      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
      > 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
      > bill and keep fees for unperformed work, but if addtional work
      > surpass the retainer is needed, the client has the option of
      > more the additional fees, or wait until next month.
      > QUESTIONS:
      > 1) You mean some of you keep the retainer regardless, even for
      > 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, coming up with new ideas, refining, give value to the
      > client and go beyond what's expected, draft edit draft more
      > etc.
      > I also provide my clients with monthly statements detailing
      > 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 2 of 21 , Aug 1 1:04 PM
        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

        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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