Effective hourly rate
Retainer fee ÷ hours actually delivered. You priced the retainer at one rate; over-servicing quietly re-prices it. A $4,000 retainer scoped at 30 hours is $133/hr — deliver 38 and you’re working for $105.
Free tool
What is over-servicing your retainers actually costing you?
Every agency over-delivers on some retainers — the question is by how much, and what it does to your effective rate and margin. Enter your book below. Everything runs in your browser; nothing you type is sent anywhere.
How to read the numbers
Unpaid hours per month
Hours beyond the budgeted scope, per client and across the book. These hours are invisible in most agencies because nobody logs against the retainer budget — they just feel like a busy month.
Margin erosion
The margin the retainer was priced to earn versus the margin it actually earns at delivered hours. A few points of erosion per client, multiplied across a book, is often a full salary.
The annualized number
Monthly over-servicing cost × 12. This is the figure worth taking to a pricing review — retainers get re-scoped once a year at best, while the overage compounds monthly.
The calculator shows the average. The outlier is the problem.
A book-level average is where the diagnosis starts, not where it ends. Over-servicing concentrates: typically two or three accounts consume the unpaid hours while the rest run clean, and the average smooths them into invisibility. Catching the concentration takes per-client hour tracking against each retainer's budget — which is exactly what Phloz's retainer burn tracking does: set monthly hours per client, log time against tasks, and watch the burn bar (with a department split) before the month ends instead of after. The weekly digest flags clients at or over budget automatically.
Get the retainer-pricing follow-up
We write practical essays on agency operations — pricing retainers, scoping, and keeping the margin you planned. One email when a new one ships; no drip sequence.
Frequently asked questions
- Is anything I type sent to a server?
- No. The calculator runs entirely in your browser with client-side JavaScript — there is no submit endpoint. The analytics event we record carries the client count and the overage percentage only, never dollar amounts or rates.
- What counts as over-servicing a retainer?
- Delivering more hours than the retainer fee was priced to cover. It is usually invisible: scope creep, "quick" requests, and internal rework rarely get logged against the monthly budget, so the agency only feels it as shrinking margin.
- What should I use for blended hourly cost?
- Total delivery-team cost (salaries, contractors, and a share of overhead) divided by total billable hours available per month. Most agencies land between $40 and $90 per hour. If you have never computed it, start with fully-loaded salaries ÷ 130 billable hours per person per month.
- My average says I am fine. Can I stop worrying?
- Averages hide the problem. One heavily over-serviced account offsets three under-budget ones and the book-level average looks healthy while a specific client eats your margin. That is why the follow-up to this calculator is per-client burn tracking, not a better average.
- How do I fix over-servicing once I can see it?
- Three levers, in order: track hours against each retainer budget in real time so the team sees burn before month-end; re-scope or re-price the chronic over-runners with the data in hand; and route new requests through an intake that makes over-scope work visible instead of silently absorbed.
See the burn per client, before month-end
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