'Could you just have a quick look at our bonus scheme?'
A retained client asks your consultant to 'just have a quick look' at a new bonus scheme document. The consultant does, because the client is valued and the request sounded small. It turns into a rewrite, two calls with the finance director and a manager briefing note. Nobody raised a quote. The work was absorbed into the monthly fee, and so was the next request, and the one after that.
At the end of the year the retainer looks unprofitable and nobody can quite point to why. The advice line was busy, yes, but the real drain was a stream of mini-projects that were never recognised as projects.
Why the line is never drawn
Most retainer agreements describe what is included in broad terms, and consultants are not going to reread a contract mid-call. The decision about whether something is extra is left to the person least placed to make it: the consultant who wants to help and does not want an awkward money conversation.
Even when a consultant does think 'this is chargeable', there is no easy route to act on it. Raising a quote means drafting something, asking a director and waiting, while the client wants an answer now. So the work gets done, the thought gets forgotten, and no invoice follows.
What the leakage costs
| Kind of work | Often treated as | Commercial effect |
|---|---|---|
| Policy rewrites beyond the handbook | Advice | Days of consultant time inside the fee |
| Restructure planning | A few calls | Large projects never quoted |
| Manager training sessions | A favour | Delivery time and travel unpaid |
| Investigations | Part of case support | Fixed-fee work done for nothing |
| Bespoke documents | Template work | Drafting time not recovered |
There is a quieter cost too. Clients who receive project work free come to expect it, which makes the eventual conversation about scope harder, and consultants who feel they are giving too much away become reluctant to pick up the phone.
How we build scope tracking and billing
- Each client's retainer scope is recorded as simple rules: what is included, what is always chargeable and any allowance, such as a set number of documents or training hours.
- When consultants record time or open a new piece of work, they pick a work type. Anything that falls outside the client's scope is tagged automatically.
- Tagged work creates a short decision task for a director: quote it, bill it at your standard rate, or waive it as goodwill. The waived items are recorded too, so you can see how much goodwill each client receives.
- Quotes are generated from your templates with the scope and rate filled in, sent for acceptance with a link, and the acceptance is stored.
- Agreed chargeable work becomes an invoice draft in Xero or QuickBooks through their API, with the time entries attached, ready for your finance person to approve.
- A monthly view shows each client's retainer fee, the work included, the extras billed and the extras waived.
Scope rules, rates and every decision about what to charge stay with you. The system only makes sure the decision gets made.
What changes in practice
Consultants no longer have to judge scope or talk money during a call. They tag the work and carry on. Directors make the charging decision with the facts in front of them, often before the work starts. Invoices for agreed extras go out alongside the retainer rather than months later or never. And renewal conversations can refer to a clear record of the extras a client received, charged or not.
Many consultancies find the goodwill column the most useful part. Waiving work for a good client is a fine decision, as long as it is a decision rather than an accident.
Is this happening in your consultancy?
- Retainer clients regularly get project work without a quote.
- Consultants avoid money conversations with clients.
- Your retainer agreement's scope is rarely looked at after signing.
- Some retainers feel unprofitable but you cannot say exactly why.
- Invoices for extra work go out late or not at all.