Retainers: How they work, What to expect & How to land them-EP65
Join Laura on this episode to learn about retainers - what they are, why many freelancers love them, and more importantly, how to make the most out of working on retainer.
Some pros of working on retainer:
- Better month to month income forecasting
- Fewer clients, deeper relationships
- Less time marketing your freelance skills
- More time on actual service delivery
- Better control over your own time
Making the most of the retainer work arrangement:
- Design your services around a recurring client need
- Your pitch must articulate very clearly what's in it for the client
- Understand that it is OK to say "no."
It's time for another episode of the Better Biz Academy. How exciting! And today I'm talking to you about one of my favourite ways to work with freelance clients, and that is on retainers.
Retainers are pretty much the holy grail in the freelance world; you want them, they make it super easy for you to do your job and to predict your income and clients love it because they don't have to go out and find a new freelancer every time they need a project done. Instead they know they're going to turn to somebody every month.
Retainers work really well for particular types of freelancers but they can really work for a lot of freelancers. So virtual assistants and writers may be the most common ones who work on retainer and basically that term just means that the client is paying you for a certain amount of hours or a certain number every single month for the work that you're doing. And people structure them differently, so the retainer might be four blog posts every month and you're responsible for delivering that. It could also be up to 30 hours’ worth of work every month if you're a virtual assistant or an online business manager. Basically, the retainer all boils down to providing consistent work to a client every week or every month and they're so much easier to work with than one-off projects.
And to explain that to you I'll take you back to the very beginning of my freelance writing business. I had tons of what I call one-off jobs. So those were writing and virtual assistant opportunities where the client needed one specific thing done and once the project was over, it was over. Now that worked really well for building my Upwork profile and for getting a lot of positive feedback from clients but it meant that every time I finished a project or at the end of every month, I'd have to go out all over again and market my services to new people and spend all this time pitching and seeing if the pitch has landed and if they didn't, then I'd be scrambling. And trying to generate 10 to 15 new projects every single month became really stressful.
I didn't know anything about retainers because I was so new to the freelance world, until one my clients came to me and said, 'hey could we just book you to do sixteen blog posts for us every single month', and I said, 'yes that would be great.' I started to see the power of retainers because I could predict my income. I knew every month I'm going to have x dollars coming in from at least that one client. And I made it a real focus in my business to take it from there all the way up to where most of my clients are on retainer. Now I still do have what I call one-off projects. If the right project comes my direction, I definitely will take it on.
Very quickly, retainers became my favorite way to work because they do make things simple for you from a planning perspective; not just financially but when you know you're responsible for each month, you can work ahead a little bit. So if you're going on vacation, if you know you need some down time, most retainer clients - unless you're doing something hourly that requires that you check in every single week - are going to be pretty open to you delivering work early. And that one works really well for writers who have blogs or certain pieces of content that they need to turn in every single month. So today in 2017, 95% of my business is retainer work. It's producing content every single week or month for a particular set of clients. And the crazy thing is thing is that working on retainer means less clients overall and that's really beneficial for you if you struggle with keeping track of a lot of different moving parts at once.
For me, I know that having 15 different clients every month was kind of a nightmare because it was a lot of back and forth and I had to make sure I watched my deadlines very carefully, following up on the administrative end of that; making sure every client paid etc., was really frustrating and almost overwhelming and it also increased the chances of a missing a deadline or making other mistakes that could have cost me the client. So I slowly began to shift from not just having retainer clients but to having retainer clients ordering a certain amount per month and people who could not meet that minimum threshold were let go or I referred to another writer. Depending on where you are at your freelance journey, you can set threshold at different amounts. So perhaps it's not worth it for you to have a client who pays less than $200 total in a month. And you'll raise that over time to a $500, $1000 etc. You get to choose where to put your time and energy as a freelancer and doing it with just a couple core clients is much much easier than having 12 to 15 smaller clients because you have to know each one of those clients' requirements; how they receive invoices, how long it's going to take them to pay you, the specific way that they want things and want things submitted. It's a lot of work if you're not getting paid adequately for it.
It also benefits your clients to be on retainer because you get to know their industry really well. Several of my retainer clients have been working with me for three years at this point. That means I know exactly what they do and don't want in their content. I also know how to deliver it easily, how much research and time it's going to take me to do each particular piece and as I delve deeper and deeper, I learn more about their businesses and the process. So I become more of an expert in their area of focus and their business in general. So the more I get to know a law firm, for example, the more I know about what their unique value proposition is, that they offer their individual clients, the success rates they have and things like that and it's really powerful to know that. The other thing that I love about retainers is that you can take time off. So I've gone on multiple week vacations where I have been able to deliver all of my work ahead of time. Now a lot of people ask, well how can I get retainer projects. I'm doing all of these one-off projects and that's great and I'm excited to be getting paid but I'm not really building my business and improving my revenue. Retainers require a little bit of a different approach. First of all, you have to think about some type of service that you could sell over and over again every month; it could be social media management if you are a virtual assistant, it could be blogs if you're a content writer, it could just be that the client needs copy every month and you're going to offer them $1000 a month retainer of whatever their copy needs are. It'll shift; it might be some emails, it might be some web content and you clarify those terms, but in order to sell a client a retainer, you must be able to illustrate what makes it worth it for them.
So why would they want to consider a retainer? And I'll tell you what I use with my clients. So my clients are busy; they are running agencies, they are running law firms, they don't have time to worry about one more thing. What I offer them with a retainer is basically said it and forget it; they don't have to worry about their content. It looks as though the content is going out written by their law firm, sometimes every day, or written by their digital agency or whatever the company might be. But they don't have to research it, write it, edit it or post it. So I offer ease and their time back, which is a huge reason for them to consider a retainer. Yes, you're going to have to pay me every single month as an independent contractor. However, in return for that, you never have to worry about your content. It's going to go out just as if you're doing it fresh yourself, every day or every week but you don't have to worry about micro-managing somebody or trying to assign that somebody within your law firm or your company - it's getting done. You don't have to think about it, you don't have to worry about whether it's accurate or not; that is all taken care of.
Now what you pitch to a client as being appropriate for a retainer could be different based on the services that you're offering. So really think about that, before you start putting your packages or pitching clients; what is in it for them? All too often freelancers spend way too much time thinking about what makes them qualified to do a particular thing. And I see this is a huge mistake in pitching. So I'll get emails, I'm a great writer. Well guess what, every single person who's pitching any client is and should be a great writer and that's also what all of your competition is saying. So there's no reason for me to hire you over anyone else because everyone has met that basic threshold, right. So what can you offer that makes it worth the client giving up just choosing to reach out to you when they want to. You could simply say that it's your company policy, of course, you can say I only work on clients on retainer and I've got an opening this month and are you interested in taking it. But why? Is it that you're going to make thing easier for them, are you going to save them money over contracting it to someone else who's more expensive, is it going to be easier to be consistent, are you going to provide reporting; what is it about that ongoing relationship that makes it an obvious yes for them to consider working with you on a retainer basis? Now, when you set up a retainer, it could be for one month, it could be for three months or it could be ongoing. Obviously, your best interests are to find wonderful clients to work who will pay you on an ongoing basis, but this might not always be possible. Businesses change and fluctuate just like yours will. So some companies may only be comfortable bringing you on for a one-month trial with the opportunity to renew one month to the next. Of course this is not the most ideal scenario for retainers because perhaps it's December and you're counting on that income for January and then it just never shows up because the client just cancels the retainer agreement. So it's much easier to be on something where you know it's ongoing and where your contract specifies how long in advance they need to tell you that the retainer is ending. Some of the most common new retainer relationships start at three months. So it's a great chance for you to see how the client works, how they pay, and whether it's on time and to give them a chance to be thrilled with your work. Three months is also just long enough of a time for them to realize what it's like to work with you and to begin to see results from the actions you have taken. Now when you do bring on a client at the three month or even the one month mark, you need to blow it out of the water so that they are very impressed with your work and of course, want to continue working with you. If you're missing deadlines, turning in work that is subpar or are just difficult to deal with, the client will cut ties. And you can read about this on a recent blog post I did about the Quirky Handbook website where I talk about managing a team of more than a dozen freelance writers and why some of people were let go because they were difficult to work with. Clients have a choice, so remember, if you've gotten them to sign on the dotted line and say yes to working with you on a retainer, you need to show them, especially at the beginning, that it is well worth the effort.
Now, when you do a retainer agreement you need to be crystal clear in the contract about what it includes and doesn't include. Your worst nightmare could be bringing on a client that orders 5,000 words worth of content every month or ten hours of your work and then they nitpick back and forth, and you end up working for free. I see this a lot with writers - they don't specify their revisions policy, then they get really lax with it but they want to keep the client so they allow ten rounds of edits even though they're not getting paid for all that time and it just gets really frustrating. The client may try to change the scope of work, so you need to be really clear upfront about what is included and what isn't. And that's true even when - let's say you have a conversation with a client and you say my Pinterest management services include creating the images and pinning them once per day, and then you negotiate a price based on that. Then the client comes to you two months into it and says, well we really want you to pin five times per day and we'd really like you to make two different sized images. Well that's different than what we originally talked about. So now you need to go back to the table with your pricing and get them to agree to a new thing as well.
Even retainer clients may not be appropriate for your business forever. They might simply change their needs or you might grow out of it and evolve. I have definitely let retainer clients go who have either become too difficult to work with or are just no longer a fit for the direction I'm going or they don't order enough work. So sometimes, over time people decrease their needs and if that's not the right fit for you, it can be really frustrating if you were counting on that income or if it's pulling time away from your more lucrative and important assignments. Retainers - really come down to that core ability of yours to illustrate to the client that there's a reason they should pay you ongoing. You're going to take things off their plate; you're going to make sure things are done correctly; you're going to make their life easier for them; those are some of the best ways to pitch a retainer project because your client has to see what's in it for them. They should not be tempted to come back to you and say, well I really only need one blog every three months. If you're shifting your business towards that retainer model, you need to be mindful of who you accept into your world and who you say yes to as you're building your client base. And you can say no to people. In fact I strongly recommend it. Even retainer clients at the outset may not be the right fit for you.
And one other thing I want to share about this is that it's very hard to do this overnight. Four years ago when I really started shifting from one-off projects towards retainer clients, it took me time to do it. It started with one client and then it slowly evolved over time to be most of my client base working on retainer. And it's great now because I know how much time I have if somebody leaves or ends their contract, I know how much room I can fit into my schedule and that I need to find a new retainer client - but it was not overnight. It took months in order to shift from all these one-off projects to retainer agreements. The main thing that contributed to me being able to do that were great comments and feedback from clients that I had just started working with. Often times it was them coming to me saying, can you do this regularly, can we book you on an ongoing agreement. And once you have a couple of those, it's much easier to be confident about pitching yourself in that way to future clients. So if you want to pitch somebody for regular work, you could just go to them directly and say, I really only work with retainer clients and I only have one spot open currently on my calendar to take somebody on. And after you've landed a couple of those retainer clients, then you can really refine your processes and get faster, become more effective, deliver amazing value for those specific clients as well.
There's a lot I could say about retainers and I really think that a lot of that will be condensed to an e-book about the retainer process and how it works and what to consider your pitching clients in this way. But I hope this was at least a wakeup call for you.
If you don't have clients on retainer right now and you're thinking, I want to go that direction, is there someone you're already working with who's been thrilled with your work, who has the potential to be a retainer client; it's going to be much easier to convert somebody who already knows you, likes you and has had a good experience working with you, into a paying retainer client. Of course, you can land new clients and get them on retainer too, but it's also great to get your feet wet with someone you already like working with too. It's still possible to bring on nightmare clients on a retainer and then you're maybe obligated to work with them for a couple of months, unless you've got a termination clause in the contract. I'd love to hear what questions you have about freelancing retainers and how you've been able to use them to build your own freelance business. Remember, I've got an amazing opportunity for people who are interested in starting their freelance writing career. You're going to get access to two award-winning, highly recommended courses; Yuwanda Black's 'Intro to SEO Copywriting' course which is everything I used to build my SEO copywriting empire, and 'My Guide to Killing It on Upwork' - all my tips and tricks on how the navigate the world on the biggest freelancing site and land amazing leads and clients from it. So check that out in the show notes below.
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