A retainer in software development is an agreement between a client and a software development company or individual developer, whereby the client pays a predetermined fee, usually on a recurring basis (monthly, quarterly, etc.), to secure ongoing services. This payment guarantees the availability of the development team or resources for a specified number of hours or days during the agreed period of time. Retainers offer more flexibility allowing the client to utilise the developer's services as needed within the scope of the agreement on an ongoing basis.
Retainers in software development offer a predictable cost structure, making budgeting easier for businesses that require on-going updates and/or support. They foster long term collaboration, enabling development teams to better understand a client's environment & needs and thereby provide tailored solutions. Clients benefit from priority access to resources, flexibility in addressing evolving needs and consistent quality without the pressure of project deadlines. For development teams, retainers ensure a steady workflow and revenue, leading to efficient resource allocation and a more stable working environment, ultimately benefiting both parties.
As with any contract, Retainer agreements will vary from company to company in terms of what they offer and the terms and conditions that underpin them. However, here are some key aspects that can make up Retainer agreements in Software Development -
A project-based retainer is an agreement whereby a client pays a recurring fee for ongoing software development services related to a specific project. It ensures the development team's availability for continuous updates, maintenance and the evolving needs of the project in question.
An example of a project based retainer could be a company developing a mobile app, decide to engage a development team on a retainer basis to handle regular feature updates, bug fixes and performance improvements during it's initial launch period for a set number of hours per month over a pre agreed block of time. This arrangement ensures that the development team is consistently available to work on the project, providing flexibility to address evolving needs, continuous updates and maintenance. The retainer typically covers a predefined scope of work or a set number of hours each period, allowing for long-term collaboration and prioritisation of the client's project needs without the need for constant renegotiation. With project based retainers, there is usually an end point i.e. once the project is delivered, there is no further need for the involvement of the development team.
Monthly and weekly retainers in software development (may also be referred to as a support retainer) are generally a recurring payment arrangement where a client secures a development team's ongoing services for a set number of hours or days each month for general tasks not related to a specific project including support, maintenance and bug fixes.
A typical monthly or weekly retainer in software development is an agreement where a client pays a set fee every month or week for a pre-agreed period of time to secure ongoing access to a development team's services. A monthly retainer provides a set number of hours per month, suitable for longer-term requirements and a weekly retainer provides a set number of hours per week and may be more suitable for shorter term projects. For instance, a business might use such a retainer to ensure continuous updates and support for their website including fixing bugs, implementing new features and performing security checks. Similarly, a company developing a custom software application could this type of retainer to guarantee regular maintenance, address any performance issues and adapt the software as their needs change. This arrangement provides financial predictability and ensures that the client has consistent access to the development team's expertise without needing to renegotiate terms frequently or to limit the support they receive to a specific project, it can also help with internal resource planning.
Managing a retainer contract between the service provider and client regardless of the type of retainer should be based around the same principles as any binding contract. To ensure both parties remain on good term and aligned to the same goals the following steps can be taken -
Clear Scope of Work - Define the specific services covered under the retainer, such as website maintenance, security updates or general support and outline any limitations to prevent misunderstandings.
Regular Communication - Maintain frequent communication between the client and the development team to discuss progress, avoid scope creep, address issues and adjust priorities as needed. It may be a good idea to agree on a structured communication plan initially.
Time Tracking and Reporting - Track time spent on retainer tasks and provide regular reports to the client to ensure transparency and accountability.
Be Flexible Where Possible - Allow for adjustments in the scope of work or priorities based on the client's evolving needs and pain points whilst adhering to the agreed retainer terms.
Regular Reviews Periodically review the effectiveness and success of the retainer arrangement, assess whether services are meeting client expectations and make any necessary adjustments.
Resource Allocation Allocate the development team's resources in an efficient manner to balance retainer work with other projects, ensuring timely and high-quality service delivery.
Clear Terms and Conditions Establish well-defined terms regarding payment schedules, service levels and contract duration to align expectations and ensure a smooth working relationship.
The pricing model and structure of any retainer agreement will differ from provider to provider. Some companies charge a flat on-going retainer fee, some will require to be paid in full upfront and some may require a lump sum upfront with a subsequent weekly or monthly fee depending on the retainer period. The pricing may also be determined in part by the number of retainer hours required - generally the lower the hours, the higher the cost. Below are some of the most common types of retainer agreements and their pricing models.
Hourly Retainer Clients buy a block of hours to be used within a designated period, such as a week or a month. The development team logs the time spent on tasks, and clients can allocate these hours as needed during the agreed timeframe.
Project-Based Retainer This retainer is linked to the ongoing needs of a specific project. Clients pay a regular fee throughout the duration of the project to cover continuous development, updates and support for that particular project.
Support Retainer Clients pay for a set of predefined services such as bug fixes, feature enhancements or security updates, on a recurring basis. The specific services and their volume are agreed upon in advance.
Tiered Retainer A tiered retainer offers different levels of service at different fee tiers with each tier providing a distinct set of services or a higher number of hours. This allows clients to select a level that best suits their needs and allows them to move between the tiers with a clear understanding of the charges involved for specific services.
There may also be further components to a development teams pricing. Additional or out of scope services may attract an additional fee. Specific types of work such as website design for example may not be covered under a retainer agreement and instead, requires a separate proposal. If the hours of a retainer are exceeded during the period, some development companies may choose to charge the client at the standard or a discounted hourly rate to continue the work. Others may allow the client to use future hours to undertake the work.
In conclusion, a retainer in software development is a strategic arrangement that benefits both clients and developers by establishing a reliable, ongoing partnership. This model provides clients with predictable costs, access to development resources and the flexibility to address evolving needs without constant renegotiation. For development teams, retainers ensure a steady workflow, enabling efficient resource allocation and fostering long-term relationships with clients. Whether through project-based, monthly or tiered retainers, this approach supports consistent service delivery, aligns development efforts with client goals and enhances overall project success, making it a valuable option in today's dynamic software development landscape.
If you dont like filling in these forms, or you would prefer to speak on the phone or via email then please use one of the below:
0115 772 2751