Which client should you turn down?
Six retainers, two kinds of hour and a freelance budget you may or may not spend. The client with the best fee an hour gets turned down, and sixteen freelance hours are worth $7,192 a month.
Words on this sheet
- Contribution: What is left of the income after the costs that come with it, before the fixed costs are paid.
Marketing Starter Optimization free
After you install, this is the model to open.
Which Retainers Fit the Team We Have?
- In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
- Click Start from a template and put that name in the search box.
- Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.
The answer
- Sign five, not four
- $54,292 a month, against $47,100 for the four biggest fees
- The edge
- +$7,192 unlocked by 16 freelance hours costing $1,408
- The client to decline
- the bank its 78 hours crowd out two better retainers
- Capacity used
- 64 + 206 strategy hours at the cap; creative 190 in-house plus 16 bought
Six retainers, two kinds of hour, and one of the two can be bought in. The sheet opens on the book an agency signs by instinct, which is the four biggest fees: the brewery, the software client, the legal practice and the bank. That is $47,100 a month, it fits inside both capacities, and it needs no freelancers. Click Run and the optimizer returns $54,292, which is $7,192 a month more, by signing five clients and buying 16 freelance creative hours for $1,408.
It signs the skincare brand, the software client, the hospital group, the brewery and the legal practice, and it turns the regional bank down. The bank is not the worst client on the sheet by fee, and it is not the worst by fee an hour either: the fee an hour column says it earns $135 against the hospital group's $119, and the hospital group is the one that gets signed.
What the optimizer can see and that column cannot is that strategy time is the resource that runs out. In-house strategy is 64 hours, the answer uses all 64 of them, and the bank costs 16 of those hours for $10,500 while the hospital group costs 10 for $8,600. Per strategist hour that is $656 against $860. When two resources are scarce and only one of them can be topped up, the right ranking is fee per unit of the resource you cannot buy.
Two runs worth doing. Set the freelance ceiling to zero and the answer falls back to $47,100, which is what the freelance relationship is worth on its own: $7,192 a month for a standing arrangement with two or three people you already know. Then put the ceiling back and raise in-house strategy from 64 hours to 74, which is one more day a week of a strategist, and the answer goes to $56,192.
That extra day earns $1,900 a month against today's pipeline, which is the number to hold the hiring conversation against rather than a feeling about how busy everyone is. What the sheet does not know is that a client is a relationship with a lifetime rather than a month, and that turning down a bank has consequences a monthly model cannot see.
Replace the six clients with your live pipeline, put your real capacities in beside the two hours-used lines, and set your own freelance rate and ceiling.
The model
It arrives on a tab called Template: Which Retainers to Sign, carrying these columns:
- Sign it (1 = yes)
- Strategy hours
- Creative hours
- Monthly fee ($)
- Fee an hour ($)
with the model computed beside the data:
| Strategy hours used | 60 |
| Creative hours used | 176 |
| Creative hours we cannot cover | -14 |
| Freelance hours above the cap | -60 |
| Fees signed ($) | 47,100 |
| Freelance cost ($) | 0 |
| Contribution a month ($) | 47,100 |
Once it is in your sheet
- The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
- Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
- Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.
Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.
Next question
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Every model like this one, and the method behind them: Optimization in Google Sheets.