Retainer pricing charges a client a fixed monthly fee to reserve your time, availability or an agreed volume of work, usually for a minimum term. It suits agencies, consultants, lawyers, accountants and IT firms with ongoing clients. Price it from the value delivered and your real capacity, define the scope in writing, and consider a productized subscription when deliverables are predictable.
Key takeaways
- A retainer sells access to your time; a subscription sells a defined deliverable. The difference decides who carries scope creep.
- Price retainers from value and capacity, then check the effective hourly rate never falls below your floor.
- Use minimum terms, rollover rules and an annual price review written into the agreement.
- Watch client concentration: the book's rule is no client above 10% of revenue and the top five below 25%.
One of my first consulting gigs was for a guy selling driver fatigue alarms.
What's a driver fatigue alarm? Great question. It's an earpiece that detects whether you're falling asleep at the wheel. A great device. Saves lives. Brilliant for truck drivers.
The only problem is that it's really hard to sell. Nobody wakes up thinking, "I need a driver fatigue alarm."
I agreed to do part-time work for $1,500 a month. I thought part-time meant about one day a week, leaving me the rest of the week for higher-paying clients.
I thought wrong.
Part-time turned into basically full-time. The product was so hard to sell that I felt obliged to put in more hours to get sales moving. (I take on every project like it's my own business, which is great for clients and terrible for retainers.) After the first month we parted ways amicably.
I tell that story in Feed a Starving Crowd because it's the retainer trap in one paragraph: a fixed fee with a fuzzy scope means the person who cares most ends up paying for it.
What Is Retainer Pricing?
A retainer is a fixed monthly fee a client pays to secure your services on an ongoing basis. There are four common types:
| Type | What the client pays for | Typical users |
|---|---|---|
| Availability retainer | Priority access to you, whether or not they use it | Advisers, lawyers, board-level consultants |
| Hours bank | A set number of hours each month | IT support, development, design |
| Deliverables retainer | A defined list of outputs each month | Marketing agencies, content, bookkeeping |
| Advisory retainer | Ongoing advice and a regular meeting cycle | Accountants, virtual CFOs, strategy consultants |
The last two are really subscriptions under another name. The first two are closer to the book's minimum commitment model: the client commits to a minimum, and you commit to being there.
Retainer vs Subscription: What's the Difference?
| Retainer | Subscription | |
|---|---|---|
| What's sold | Your time, availability or capacity | A defined deliverable or outcome |
| Scope | Often flexible, negotiated per client | Fixed, the same for every client on the plan |
| Price | Usually custom per client | Published tiers |
| Who carries scope creep | You, unless the agreement is tight | Mostly the plan design, extras are priced |
| How you get more efficient | Savings often go to the client as more work | Savings become your margin |
| Sales process | Proposal and negotiation | Can be bought from a pricing page |
| Best for | Complex, variable, relationship-heavy work | Repeatable work with predictable effort |
Here's the simplest way I can put it.
If you can write down exactly what the client gets each month, sell a subscription. If you can't, because every month is different, sell a retainer, but put guardrails around it.
A subscription built from a retainer is what people call a productized service.
When Does a Retainer Beat a Subscription?
Retainers are the better choice when:
- The work is unpredictable by nature: crisis communications, legal advice, interim management.
- The client values access to a specific person more than a list of outputs.
- Each client is genuinely different, so a standard package would fit nobody.
- You're early, still learning what clients actually need before you productize it.
Subscriptions win when the work is repeatable, when you want to sell without a proposal for every client, and when you want efficiency gains to land in your margin.
Accounting shows the shift. A 2025 benchmark of 219 US accounting firms found hourly billing for CFO and controller services fell from more than 20% of firms to 10%, as firms moved advisory work to fixed fees. Two-thirds of firms that raised prices in the past year lost no clients, or lost some but kept profitability stable.
How Much Should You Charge for a Retainer?
Start with value, then check two floors: your capacity and your effective hourly rate.
Effective hourly rate = Monthly retainer fee ÷ Hours actually spent on the client that month
Worked example: a marketing consultant's retainer (ex-GST, illustrative)
The consultant wants a floor of A$150 an hour after costs, and has about 100 billable hours a month. A client wants ongoing campaign management. The consultant estimates 16 hours a month: A$2,400 at the floor rate.
Value check: the client's campaigns produce about A$40,000 a month in sales. If good management lifts that by even 10%, that's A$4,000 a month of extra sales. A fee of A$3,200 a month is easy to justify.
Month three: the client keeps asking for "just one more thing," and the consultant spends 30 hours. The effective rate falls to about A$107 an hour, well below the floor. That's the driver fatigue alarm problem. The fix is a written scope of 16 hours or a defined deliverables list, with extra work at A$190 an hour, and a monthly report showing hours used.
Work out your own floor with the Consulting Rate Calculator. For broader advice on what to charge, read pricing your consulting work.
Consulting Rate CalculatorPrice your time, retainers and success fees.Open the free tool →The "lower fee plus a percentage" option
In Feed a Starving Crowd I describe a hybrid: a lower monthly fee plus a percentage of the sales you generate. It's tricky to get right, and I'd only do it if the business is a "slam dunk." My criteria included: the product already sells, ideally digitally so the margins are there; the client has credibility and an existing list of at least 5,000; they already have a higher-priced product in place; their core pain point is execution; and you have authority to make and execute marketing decisions. Without those, you're taking on the business risk for a fraction of the reward.
A Sample Retainer Structure
An illustrative three-level retainer for an IT and cybersecurity consultant (prices are examples, GST extra):
| Essential | Professional | Partner | |
|---|---|---|---|
| Monthly fee | A$1,200 | A$2,800 | A$5,500 |
| Included hours | 8 | 20 | 40 |
| Extra hours | A$165 | A$150 | A$140 |
| Unused hours | Roll over one month | Roll over one month | Roll over one month |
| Response time | Next business day | 4 business hours | 1 business hour |
| Strategy meeting | Quarterly | Monthly | Fortnightly |
| Minimum term | 3 months | 6 months | 12 months |
Published levels like these turn a custom retainer into something much closer to a subscription, and make price reviews easier.
Is your retainer pricing actually profitable?
Australian firm owners can book a free 30-minute Subscription Profit Review with a BPAG adviser to talk through whether a retainer model suits the firm.
What Are the Risks of Retainer Pricing?
Overservicing. The most common one, and the one I learned first-hand. Track hours against every retainer monthly, even if you don't bill hourly.
Underuse. A client who isn't using the retainer will eventually ask why they're paying. Send a short monthly summary of what you did and what it achieved.
Client concentration. Retainers make it easy to end up with one or two big clients. In The Subscription Playbook's MOATS framework, one of the moat factors is low customer concentration: no client above 10% of revenue, and your top five below 25%. A retainer client at 40% of revenue isn't recurring revenue. It's a single point of failure. See the MOATS framework.
Cash flow. Bill in advance, by direct debit, on the first of the month. Never let a retainer run on 30-day terms in arrears.
Contract terms. Standard retainer agreements with Australian small businesses are covered by the unfair contract terms laws. Since 9 November 2023 unfair terms in standard form contracts carry penalties, and a small business means fewer than 100 employees or turnover under A$10 million. Keep minimum terms, exit fees and automatic renewals reasonable and clearly disclosed. See unfair contract terms. This is general information as at October 2026, not legal advice.
Price drift. A retainer that hasn't moved in three years is a pay cut. Write an annual review into the agreement and use a price increase email to give notice.
How to Turn a Retainer Into a Subscription
If you're ready to move from custom retainers to something more scalable:
- Review your current retainers. What do most clients actually get each month?
- Group them into two or three standard levels with fixed inclusions.
- Publish the levels on your site, even if you still tailor the largest clients.
- Move new clients onto the standard levels first, then migrate existing clients at their next review.
- Price extras clearly, and report usage every month.
Bigger players do this too. When Salesforce launched its AI agents at $2 per conversation in 2024, it added Flex Credits at $0.10 per action within seven months, then kept per-user licenses for other buyers. Clients self-select by how much risk they want to carry. A firm can do the same with a fixed retainer and a pay-per-job option side by side.
For industry-specific versions, see the agencies playbook, the consultants and coaches playbook and the law firms playbook.
What to Do Next
- Calculate the effective hourly rate on every current retainer for the last three months.
- Flag any client above 10% of revenue, and any retainer below your floor rate.
- Rewrite your agreement with a scope, rollover rule, extra-work rate, minimum term and annual review.
- Draft two or three standard levels and test them on your next new client.
- Set a date to review every retainer's price this year.
Here's my question for you: which of your retainers would you sign again, at today's fee, knowing how many hours it really takes?
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Download it freeFrequently asked questions
How do agency retainers work?
The client pays a fixed fee each month, usually in advance, for an agreed level of service: a set of deliverables, a bank of hours, or ongoing availability and advice. Most agency retainers run for a minimum term, often three to twelve months, then roll monthly. The agreement should spell out what's included, how extra work is priced and how either side can end it.
What happens to unused retainer hours?
Decide upfront and write it down. Common options are 'use it or lose it,' rolling unused hours into the next month only, or rolling them over with a cap. A one-month rollover is a fair middle ground. Letting hours pile up indefinitely creates a liability you'll eventually have to deliver, often at the worst possible time.
Should a retainer be paid in advance?
Yes, usually. Billing on the first of the month for that month's work protects your cash flow and avoids chasing payment after the work is done. Direct debit or card-on-file billing makes it automatic. Prepaid fees are generally recognized as revenue as the work is delivered, so talk to your accountant about how they appear in your accounts.
How do I raise prices on an existing retainer client?
Write an annual review into every retainer agreement, ideally on a fixed date, so the conversation is expected. Give at least 30 days' notice, link the increase to the value delivered or to cost increases, and offer a choice: the same scope at the new price, or a reduced scope at the old price. Never let an increase arrive as a surprise invoice.
Is a retainer the same as a legal retainer?
Not always. In law, 'retainer' can mean the engagement itself, or money paid upfront that is held and drawn on as work is done. Lawyers have specific trust account and costs disclosure rules. This page uses retainer in the business sense, a recurring monthly fee for ongoing services. Law firms should check their own professional obligations.
Talk it through with a BPAG adviser
Free for Australian business owners: a 30-minute Subscription Profit Review on whether a subscription suits your business.
Robert Coorey, MBA
Robert is the author of The Subscription Playbook and Feed a Starving Crowd and a Director at BPAG Accountants in Sydney. More about Robert.
Sources
- CPA Practice Advisor: Report shows shift in pricing for accounting firms (21 August 2025)
- ACCC: Businesses urged to remove unfair contract terms ahead of law changes
- Salesforce: Introduces new flexible Agentforce pricing (15 May 2025)
Facts and prices checked 27 October 2026. Spotted something out of date? Tell us.