retainer

Under a retainer, a client and service provider agree how much capacity is available per period. In software development, this often means a number of hours or days per month. The time can cover maintenance, support, research or new functionality. They can also agree how to set priorities and how quickly the provider responds to urgent requests.

How does a retainer work?

For each period, both parties determine the required effort and which work comes first. The details can therefore change each month. They do not need to specify months ahead which bug, improvement or feature will be addressed, while capacity remains available.

Payment arrangements vary. A client may pay a fixed amount in advance for reserved availability. A retainer can also provide an agreed allocation of hours with invoices based on actual time spent afterwards. The parties specify whether unused hours expire or carry over, how capacity can change and which work is included. Response times may be covered by a separate SLAGlossary · In briefSLASLA stands for service level agreement: an agreement between a customer and provider about the service, its agreed level and how that level is measured.Read more.

Retainer or project agreement?

A project agreement suits defined work with a clear result, such as building a specific extension. A retainer suits recurring work where priorities may change, such as an application needing monthly maintenance, small improvements and support.

The arrangements can follow or complement one another. A larger extension can be planned as a project, followed by maintenance and further development under a retainer. The arrangement primarily determines how capacity and commitments are organized; it does not itself define the development method or quality of the work.