Working on retainer generally means the client is expecting to throw you a lot more business than they are letting on, in exchange for a discount, hoping in that way to get a better deal… and for priority access to your services. It also can mean they just want all the billing and admin totally streamlined, one price, anything you need, done. So if I’m them, the retainer rate is one price for “anything and everything”, so that means you have to pre-figure your other services and subs into that number, and not bill them out separately. And yes, this entails risk for you, since you will eat whatever expenses the retainer didn’t cover. So you don’t dare low-ball the retainer. And that makes the retainer less attractive to the customer. Maybe, the retainer has to be highly restricted in scope, not” one price for anything and everything, any time”, but, “one price for as many powerpoint slide montage videos as you need”. And any services above that minimum package are separately billed out.
What if they put you on retainer and then not give you any work for weeks or months? At first blush, it seems like you should rebate or prorate, since you did nothing. However, the whole point of a retainer is, you are on full-time alert to answer their emergent needs; like Batman, you come-a-running if the signal goes up. That represents opportunity cost; maybe you can’t take on certain other jobs that could interfere with the retainer client, you can’t do vacation trips out of town, you cannot tear down the edit bays for a planned rebuild/upgrade… or, you may have to cancel such jobs at the last minute, damaging the cash flow and potentially your reputation and other client relationships. So, for those reasons, maybe you don’t rebate or offset anything, because at the heart of it, you’re being paid to be available, whether or not you are actually used. In union labor law, there’s the idea of “waiting to be engaged” vs. “engaged to be waiting”. Firemen on duty at the firehouse are engaged to be waiting, and get paid for being on their shifts, if there’s a fire or not. You are the fireman here.
If you get the retainer, you probably need to put your subs on one with you, for any work coming out of that client. It won’t do to get the call for urgent service and then turn to find your contractors can’t do it. It may chafe you to pay the staff camera op or editor for work not done, but, again, opportunity cost, and “engaged to be waiting” applies all the way down the line. And you’re now a bank, extending credit for services not yet performed by your staff and subs. Do you really want to get into all that? I don’t think I would. The potential profit would have to be substantial…
After reading what I wrote, I don’t think I’d personally go for a retainer arrangement. Too much risk. Instead, I might offer a repeat client a simple discount or a “coupon” good for “x” off for a limited, expiration period of a month. The idea there is to keep them ordering services, even minimal ones, every month. Idling the engine, so to speak. But without any up-front availability commitments from you.