Creating Lucrative Consulting Contracts Through Retainer Agreements
Posted on 10. Sep, 2009 by Debra Thompson Roedl in Consulting, Information Marketing
One of the great benefits to Information Marketing is that you can generate revenue through a number of opportunities besides just creating Information Products. Consulting is one of those opportunities and one that you should consider. Why? Because one of the fastest ways to make money quickly is through consulting.
But if you are just getting started in consulting and you don’t know how to negotiate your fee, then one of the strategies you should consider is negotiating your services through a retainer. A Retainer agreement, is a contract between two people or companies where one pays to reserve the others time.
The Pros and Cons To Retainer Agreements
So, when it comes to retainer… one thing you have to take into consideration is that a business arrangement with a retainer is more valuable and therefore should be worth more (you charge more).
The reason for this is because someone is essentially saying we want to be able to call upon you at any time throughout the retainer period and have immediate access to you, your knowledge and your time. This is like being "on call". With that said… you have to determine first what your time is worth for being "on call"… this is premium time. Then the second thing you have to do is estimate the amount of hours you are willing to provide for the retainer and for what duration. You need to ensure that you are getting premium reimbursement for your time and that this is reasonable upon your schedule.
Also… this is important. Negotiate that once x hours is exceeded during the retainer period, that you will be reimbursed $xx.xx per hour for any additional hour over the agreed time. This will ensure you are not taken advantage of and will then be reimbursed fairly for your services.
Retainers Can Be Very Lucrative
Retainers can be good on your part when negotiated carefully and in your favor. I’ve had several retainers where I negotiated monthly rates and the client was paying for my "on-call" time to have access to me, my knowledge, my contacts etc. whenever they needed. Often times I would work maybe 5 hours a month and yet still receive several thousands of dollars per month regardless of the actual time I worked. If I worked less hours than agreed to for the monthly retainer, they still had to pay me the retainer monthly lump sum, Yet, if I worked x hours over the agreed time they would pay me my hourly rate for any additional hours. So in this example you can see when it can be lucrative and your time reimbursed accordingly.
Make sure that when considering a consulting opportunity that it meets with your vision, it produces revenue for your company, it continues to move you forward and is a win-win. If it doesn’t meet any of these criteria… then think twice. This is your business… you are in it to make money. You can help others after you make money. Don’t feel obligated to help friends, family, etc. and above all don’t devalue your talent and expertise. Charge accordingly.
About the Author
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Debra Thompson Roedl is an internationally renowned Information Marketing expert, author, speaker, trainer and consultant. Visit her blog and signup to receive to get free special reports on business and marketing strategies, along with blog updates, news and more!
Go now to http://www.debrathompsonroedl.com. Also click here so you can Follow Debra on Twitter.
