I'm getting my first retainer client soon, but I'm not sure what my policy should be if she has time left over each month or uses more time than alloted by the retainer.
I'm giving her a discount for being a retainer client. But if she goes over the retainer hours each month, should I charge her my normal fee for the extra hours?
Hours over retainer are billed at the regular rate and unused hours can be rolled to the next month or lost. I saw it on one site called a shelf life. This individual had a 90 shelf life on retainer hours. After 90 days the hours were gone. Hope this helps.
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Jenifer D
This is personal/business preference. For me, I have a use it or lose it policy. If you do not use all of your hours, you can not carry them over to the next month. However, if you go over your monthly allotment of hours, then I bill them at the discounted rate.
I anticipate when I begin getting retainer clients that I will also have a 'use it or lose it' policy. Allowing carry over could get to be a real nightmare.
I made the mistake of not putting a shelf-life on the "rollovers" and I had a client not renew her contract but just wanted to use all of her rollover hours til they were gone. (This was after asking to end her retainer a month earlier due to lack of funding) Needless to say that was a hard lesson learned.
I have to agree that though it is a nice feature to have roll-over it just isn't good business in the long run. (unless you put a 60 or 90 day shelf on them, but then you have to keep track of what hours are from what months invoice and that could get sticky without a use policy in place.)
To save the headaches a use it or lose it policy is the cleanest. With this I would bill at the discounted rate for a set period of time or number of invoicing periods. That way if someone is consistently going over their retainer you will see it and be able to talk with them about increasing their package or begin billing them at the normal rate.
It's definitely a preference...you have to figure out what you're most comfortable with. Definitely don't leave room for any ambious misinterpretation...don't assume your client knows he/she is going to pay you at your flat hourly rate (as opposed to the discount retainer rate) once the retainer is up. Spell it out in your retainer agreement...and discuss it over the phone.
Also, don't go over the hours without letting her/him know in advance...that's breaching your retainer agreement. What I do is I track my hours...and depending on the amount of hours in the retainer, I let them know in increments. i.e...one client need 15 hours (so I keep him updated in 5 hour increments) but another client uses a 40 hour retainer (i keep him updated in 10 hour increments)
Hope this helps.
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Sincerely,
Anastacia Prince of Prince Virtual Assistant Services www.princeva.com
I have a 30 day use it or lose it policy but will make exceptions on a case by case basis. It just depends. If a client wishes to purchase more hours over their retained number of hours, I bill them at the discounted rate for that month.
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