Price the commitment as well as the work
A retainer can create predictable revenue, but it also reserves part of your calendar. The price should cover expected work, allocated overhead, the value of held capacity, and a sustainable margin.
Define what the client receives
Choose whether the retainer covers hours, deliverables, response time, priority access, or a recurring outcome. Ambiguous retainers can turn into unlimited-work agreements.
Use discounts carefully
Predictability may justify a modest discount, but the discount should not erase the value of reserved capacity or reduce the price below a sustainable floor.
Example
Forty hours at 75, plus 300 of allocated overhead, a 10% capacity reservation, 15% target margin, and 5% commitment discount produces an estimated monthly retainer of about 4,057.
Common questions
Should a retainer be cheaper than hourly work?
A small discount may make sense for predictable commitment, but the retainer also reserves capacity and should remain sustainable.
Do unused hours roll over?
That is a commercial choice. State the rule clearly because unlimited rollover can create an unmanageable future obligation.
What belongs in allocated overhead?
Include recurring tools, contractors, reporting, and operating resources that support this client.
Can a retainer be based on deliverables instead of hours?
Yes. Hours can remain an internal pricing input while the client agreement focuses on recurring outputs or access.