> ## Documentation Index
> Fetch the complete documentation index at: https://docs.charle.agency/llms.txt
> Use this file to discover all available pages before exploring further.

# Retainer Plans

> How monthly retainer plans work in CharleOS

Retainer plans provide clients with predictable monthly capacity at a fixed cost. They're the foundation of the billing system, defining how much time and budget each client has available.

## What Is a Retainer Plan?

A retainer plan is a template that defines:

<CardGroup cols={2}>
  <Card title="Monthly Hours" icon="clock">
    How many hours of work the client gets per month
  </Card>

  <Card title="Monthly Cost" icon="pound-sign">
    The fixed retainer fee charged each month
  </Card>

  <Card title="Sold Day Rate" icon="calculator">
    Calculated profitability metric (cost ÷ hours ÷ 7.5)
  </Card>

  <Card title="Plan Name" icon="tag">
    The tier name (e.g., "Starter", "Growth", "Scale")
  </Card>
</CardGroup>

Plans are reusable templates—multiple clients can be assigned to the same plan, or clients can have custom overrides for special arrangements.

## Standard Plan Tiers

Most agencies set up tiered plans for different client sizes:

| Plan           | Monthly Hours | Monthly Cost | Sold Day Rate | Best For                           |
| -------------- | ------------- | ------------ | ------------- | ---------------------------------- |
| **Starter**    | 20 hours      | £2,000       | £750/day      | Small clients, maintenance work    |
| **Growth**     | 60 hours      | £5,000       | £625/day      | Standard ongoing clients           |
| **Scale**      | 120 hours     | £9,000       | £563/day      | Larger clients, multiple projects  |
| **Enterprise** | 200 hours     | £14,000      | £525/day      | Major accounts, dedicated capacity |

<Info>
  These are example tiers. Each agency sets their own plan structure, pricing, and naming based on their business model.
</Info>

### Why Day Rates Decrease with Volume

Notice that larger plans have lower day rates? This is standard tiered pricing:

* **Volume discount**: Clients committing to more hours get better rates
* **Efficiency at scale**: Larger engagements reduce context switching
* **Relationship value**: Bigger clients are worth better pricing

However, the absolute revenue and profit are higher on larger plans.

## How Plans Work

### Assignment

Clients are assigned to plans when they're created or updated:

1. **Choose a plan** from the dropdown during client setup
2. **Optional overrides** allow custom pricing per client
3. **No plan** is also valid—some clients are project-only (no retainer)

### PM Deduction

When a client is assigned a plan, **15% of the hours are automatically reserved for project management**:

```formula Net Available Hours theme={null}
Net Hours = Raw Hours × 0.85
```

**Example:**

* Plan: 60 hours/month
* PM deduction: 9 hours (15%)
* Available for deliverable work: 51 hours

This covers:

* Sprint planning
* Client communication
* Status updates
* Scope management
* QA coordination

<Warning>
  The PM deduction happens at allocation, not per task. Individual task estimates show only design/development time—PM overhead is factored into the overall monthly budget.
</Warning>

### Monthly Cycle

Plans operate on calendar-month cycles:

<Steps>
  <Step title="Month Start">
    Full allocation becomes available (e.g., 60 hours)
    PM deduction applied (e.g., 51 hours net available)
  </Step>

  <Step title="During the Month">
    Work is completed and billable hours deducted from allocation
    Client sees real-time remaining balance
  </Step>

  <Step title="Month End">
    Unused hours expire (no rollover by default)
    New allocation starts next month
  </Step>
</Steps>

## Plan Overrides

Plans are templates, but clients often need custom pricing. **Plan overrides** allow client-specific adjustments:

### When to Use Overrides

<AccordionGroup>
  <Accordion title="Negotiated Deals" icon="handshake">
    A client negotiates custom pricing based on their specific situation.

    Example: Client wants 60 hours at £4,500/month instead of standard £5,000
  </Accordion>

  <Accordion title="Grandfathered Rates" icon="clock-rotate-left">
    Long-standing clients keep old pricing when plans change.

    Example: Plan increased to £5,500, but existing client stays at £5,000
  </Accordion>

  <Accordion title="Special Arrangements" icon="star">
    Unique situations like:

    * Non-profit discounts
    * Strategic partnership pricing
    * Trial periods with reduced rates
  </Accordion>

  <Accordion title="Temporary Adjustments" icon="calendar">
    Short-term changes:

    * Reduced hours during quiet season
    * Increased capacity for project push
    * Bridge pricing during transitions
  </Accordion>
</AccordionGroup>

### How Overrides Work

When creating or editing a client, you can override:

<Tabs>
  <Tab title="Monthly Hours Override">
    Overrides the plan's standard hours allocation.

    **Example:**

    * Plan: Growth (60 hours)
    * Override: 75 hours
    * Client gets 75 hours/month instead of 60
  </Tab>

  <Tab title="Monthly Cost Override">
    Overrides the plan's standard retainer fee.

    **Example:**

    * Plan: Growth (£5,000)
    * Override: £4,500
    * Client pays £4,500/month instead of £5,000
  </Tab>

  <Tab title="Both Overrides">
    You can override both for completely custom pricing.

    **Example:**

    * Plan: Growth (60 hrs, £5,000)
    * Override: 80 hrs, £6,000
    * Effective day rate: £562.50 (vs plan's £625)
  </Tab>
</Tabs>

**Priority:**

* If override is set → use override value
* If override is null → use plan value
* Overrides are optional—leaving blank uses the plan default

## Managing Plans

### Creating Plans

Plans are managed in the Admin section:

1. Navigate to Admin → Plans
2. Click "Add Plan"
3. Enter:
   * **Name**: The tier name (e.g., "Growth")
   * **Monthly Hours**: Hours allocated (e.g., 60)
   * **Monthly Cost**: Retainer fee in pounds (e.g., 5000)
4. Save

The sold day rate is calculated automatically.

### Editing Plans

When you edit a plan, **all clients on that plan are affected** unless they have overrides:

* Edit hours → All clients get new allocation (next billing period)
* Edit cost → All clients pay new fee (next billing period)
* Clients with overrides are unaffected

<Warning>
  Be careful when editing plans with many clients. Consider:

  * Communicating changes to affected clients
  * Whether to grandfather existing clients (use overrides)
  * Impact on profitability metrics
</Warning>

### Deleting Plans

When deleting a plan, you must handle existing clients:

**Option 1: Assign Replacement Plan**

* Select another plan to move clients to
* All clients on deleted plan are reassigned
* Overrides are preserved

**Option 2: Remove Plan Assignment**

* Clients become "no plan" (project-only)
* Existing retainer data is preserved for history
* Requires manual reassignment later

<Note>
  You cannot delete a plan with clients unless you specify what to do with them. This prevents accidental data loss.
</Note>

## Project-Only Clients

Not all clients need retainers. **Project-only clients** have:

* No plan assigned (`planId = null`)
* No monthly allocation
* Work is quoted and billed per project
* Still tracked in CharleOS for capacity planning

This is useful for:

* One-off projects
* New clients in trial phase
* Fixed-price project work
* Clients transitioning off retainers

## Plan Utilization

Plans include utilization tracking to help with client management:

### Utilization Calculation

```formula theme={null}
Utilization = (Billable Hours Used ÷ Net Available Hours) × 100
```

**Example:**

* Plan: 60 hours (51 hours after PM deduction)
* Used: 45 hours
* Utilization: 45 ÷ 51 × 100 = **88%**

### Utilization Bands

| Range                 | Status      | Indicator                                      | What It Means                           |
| --------------------- | ----------- | ---------------------------------------------- | --------------------------------------- |
| **0-75%**             | Normal      | <span style={{color: 'green'}}>●</span> Green  | Healthy usage, capacity available       |
| **75-90%**            | Approaching | <span style={{color: 'orange'}}>●</span> Amber | Getting close to allocation             |
| **90-100%**           | Near Limit  | <span style={{color: 'orange'}}>●</span> Amber | Almost at capacity                      |
| **Greater than 100%** | Over        | <span style={{color: 'red'}}>●</span> Red      | Exceeded allocation, upsell opportunity |

### When Utilization Is Too Low

**Under 50% consistently:**

* Client isn't using their allocation
* Consider downselling to smaller plan
* Find opportunities to use remaining hours
* May indicate engagement issues

### When Utilization Is Too High

**Over 90% consistently:**

* Client needs more capacity
* Upsell to larger plan
* Scope discussions needed
* Risk of client dissatisfaction

## Real-World Examples

### Example 1: Standard Client on Growth Plan

**Setup:**

* Plan: Growth (60 hours, £5,000/month)
* No overrides
* PM deduction: 9 hours (15%)
* Net available: 51 hours

**Month 1:**

* Used: 42 hours (82% utilization)
* Status: Healthy

**Month 2:**

* Used: 56 hours (110% utilization)
* Action: CSM discusses upsell to Scale plan

### Example 2: Client with Custom Pricing

**Setup:**

* Plan: Growth (60 hours, £5,000/month)
* Override: 75 hours, £5,500/month
* Effective sold day rate: £550/day (vs plan's £625)
* Reason: Long-term client, negotiated volume discount

**Result:**

* Client gets 75 hours/month
* Pays £5,500/month
* Plan can be edited without affecting this client's pricing

### Example 3: Non-Profit Discount

**Setup:**

* Plan: Growth (60 hours, £5,000/month)
* Override: Cost only → £3,500/month
* Hours stay at 60
* Reason: Charitable pricing

**Result:**

* Client gets standard 60 hours
* Pays £3,500 (30% discount)
* Effective sold day rate: £437.50/day

## Plan Strategy Considerations

When designing your plan structure:

<AccordionGroup>
  <Accordion title="Number of Tiers" icon="layer-group">
    **Too few** (1-2 plans):

    * Simple to manage
    * May not fit all client sizes
    * Miss upsell opportunities

    **Too many** (6+ plans):

    * Confusing for clients
    * Analysis paralysis
    * Hard to manage

    **Sweet spot:** 3-5 tiers covering small, medium, large, and enterprise
  </Accordion>

  <Accordion title="Volume Discounting" icon="percent">
    Larger plans should have:

    * Lower per-hour rates (incentive to commit more)
    * But higher absolute revenue and profit

    Example:

    * Starter: £100/hr × 20 hrs = £2,000 revenue
    * Growth: £83/hr × 60 hrs = £5,000 revenue ✓
  </Accordion>

  <Accordion title="Plan Naming" icon="tags">
    Use names that:

    * Suggest growth (Starter → Growth → Scale)
    * Are client-friendly (not internal jargon)
    * Allow for additions (don't use "Ultimate" too early)

    Avoid:

    * Tier 1, Tier 2 (boring, no emotion)
    * Names that box you in (can't add tiers)
  </Accordion>

  <Accordion title="Minimum Viable Plan" icon="door-open">
    Your smallest plan should be:

    * Large enough to be profitable
    * Small enough to be accessible
    * A natural entry point for new clients

    If too small: Not worth the overhead
    If too large: Barrier to entry for new clients
  </Accordion>
</AccordionGroup>

## Related Concepts

<CardGroup cols={2}>
  <Card title="Billing Model" icon="calculator" href="/concepts/billing/billing-model">
    How retainer hours are consumed using value-based billing
  </Card>

  <Card title="Day Rates" icon="pound-sign" href="/concepts/financial/day-rates">
    How sold and actual day rates are calculated from retainer plans
  </Card>

  <Card title="Clients" icon="building" href="/user-guide/clients">
    How to assign clients to plans and manage their retainers
  </Card>

  <Card title="Utilisation" icon="chart-line" href="/concepts/financial/utilisation">
    How plan utilization relates to team capacity
  </Card>
</CardGroup>