I have a question for those who use retainers. In your agreements, do you have a certain amount of time that they must maintain a retainer or can it be cancelled at any time?

I originally had it so that my clients could cancel it at anytime with 14 days notice. Now, I am thinking that maybe I should have it set for one year minimum and then cancel with notice after that.

What are your thoughts on this?

Thanks

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Shannon

I don't have any retainer clients right now so this will probably change in the future. My contract states that they can terminate at any time but I have the right to retain any prepaid money. Retainer clients pre-pay by the month so I won't be doing any work that I haven't been paid for. I don't have a minimum contract term right now. They can go month to month. I think a year sounds too long especially if you're just starting out trying to get new clients. I'm interested in what others with more experience have to say.

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LoriAnne
OnlineOfficeLink

I originally had it set for a one month term and no minimum amount of months. I've lowered the discount given and allowed 3months to use the hours - again no minimum amount of months.

My concern with a year term is that clients may shy away from such a long committment. Heck, I cringe anytime any essential service asks me for more than a month-to-month committment.

That's a very good point. I will stick with what I had originally done. I wasn't too keen on the idea, but I had read somewhere about someone doing it and was more curious if it was the norm. Thanks for you input.

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Shannon

Hi Shannon~

I "request that 30 days notice be given". That being said, if a relationship turns toxic or otherwise disintegrates, neither you or the client probably want to stay in it any longer than necessary. Also, the cost of trying to hold someone legally to the 30-day notice would far exceed the fees you would earn.

Warmly,

Lorri

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Lorri Morin, CPVA
www.virtualsynergy.net

I agree with Lorri 100%. 30 day notice or mutally agreed.

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Tamika R. Johnson, MBA, Principal
administrative partners, llc
www.administrativepartners.net | http://adminpartners.blogspot.com

I have done a lot of research, and most sites require a 3 month contract for their retainer plans. A year may be a bit extensive, but I guess it would depend how in demand you are. If you have clients on a waiting list, get the year.

Melissa

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Melissa- Owner The Invisible Assistant
"When you can no longer do it all"

I would say that should you offer both a month-to-month retainer plan and a 3+ month plan, the savings to the client should obviously be greater with the longer term.

I agree: 30-days notice. My retainers are payable in advance for the month, and I specify the maximum number of hours for the month. If pre-approved hours over and above the minimum are necessary, those are billable at a higher hourly rate.
The agreements specify the term.. whether it's just one month or longer. Contract should specify client forfeits any monies paid in advance when they terminate. (I like Encompasses' month-to-month plan.)

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Jane at www.cornerofficenorthwest.com

So from what I am reading, as I go from a retainer more often than hourly rated business, most offer 30 days but wouldn't "go after" the client if they cancelled because it would be costly. BUT you also have it noted that the prepaid money stays to you...

As I sit trying to restructure, I think I like the idea of a 30 day request of notice regarding termination, and any prepaid monies are to be kept by my business, as they broke the contract of 30 days.

I did have a client sign a 6 month contract, but really it can be cancelled most anytime. It's just that in a six month period I may re-visit the ratings, etc. That is how I had been working, but as I move forward I think I like the 30 day notice requested and a notice some where in the contract that they are agreeing their money will not be refunded. Which I have listed under terms on my site about deposits, but nothing about my retainer!

Great thread everyone!

Thank you!

Brandy

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Brandy Ellen's Business Solutions