Hosting Retainers

How Agencies Price Hosting Retainers (And Why You Should Never Give It Away for Free)

Stop reselling hosting at cost. Price the service: your time, your risk, and your expertise.

In this article

1. “The Conversation” (and why it’s your golden ticket)
2. The shift from “reseller” to service provider
3. The three tiers of hosting retainers
4. The “Rule of Three” for calculating your costs
5. Common mistakes to avoid
6. The bottom line

“The Conversation” (and why it’s your golden ticket)

If you’ve been running a web design agency for longer than six months, you’ve likely encountered The Conversation.

You know the one. You’ve just delivered a beautiful, custom WordPress site. The client loves it. You’re feeling good. Then they ask the question:

“So, who handles the updates and making sure it stays online?”

This is your golden ticket. Not just to steady monthly income, but to a healthier relationship with clients. Yet so many agencies stumble here, treating hosting like a pass-through cost rather than the valuable service it is.

Let’s talk about how smart agencies price hosting retainers—and why you should never, ever resell hosting at cost.

The shift from “reseller” to service provider

First, clear the mindset hurdle: if you’re buying a $20/month server from a hosting company and charging the client $20, you aren’t an agency—you’re a middleman. And middlemen are easy to replace.

The moment a client has downtime or a malware scare, they aren’t calling the hosting company—they’re calling you. You handle the stress, the late-night emergencies, and the “my site is broken” emails.

Your pricing needs to cover

• The Cost of Goods: the actual server or hosting plan
• Your Time: maintenance, updates, uptime monitoring
• Your Risk: the liability you take on when you put your name on the line
• Your Expertise: knowing how to fix it when things go wrong

The three tiers of hosting retainers

Most successful agencies land on a three-tier model. It lets clients choose their level of involvement (and budget) while ensuring you don’t lose money on high-maintenance accounts.

Tier 1: The “Essentials” Plan ($75–$150/month)

For the small business owner who wants “set it and forget it.” They don’t want to log in; they just want the site fast and safe.

Pricing rationale: Covers managed hosting cost (roughly $20–$30) plus ~1–2 hours of low-level maintenance per month.

What’s included

• Managed WordPress hosting (on a reliable platform like WP Engine, Kinsta, or a reseller account)
• Daily backups stored off-server
• Core WordPress, theme, and plugin updates
• Basic security monitoring
• 1 hour of “small changes” per month (like a text tweak)

Tier 2: The “Performance” Plan ($250–$500/month)

The sweet spot. These clients have e-commerce or lead-generation sites that matter. They care about speed and uptime.

Pricing rationale: More robust hosting (or VPS) plus time for performance reporting and proactive care.

What’s included

• Everything in Essentials
• Premium performance optimization (caching, image compression, database optimization)
• Uptime monitoring with SMS alerts
• Monthly performance reports (Core Web Vitals, traffic stats)
• 3 hours of development time (for bigger content updates)
• Priority support (they skip the line)

Tier 3: The “Growth” Partner ($750–$1,500+/month)

Reserved for agencies acting as a true fractional CTO or marketing partner. The retainer isn’t just about keeping the lights on; it’s about growth.

Pricing rationale: Beyond maintenance into strategy. You aren’t just updating plugins; you are ensuring the site converts.

What’s included

• Everything in Performance
• Conversion Rate Optimization (CRO) suggestions
• SEO health checks and tweaks
• Advanced security scans and malware removal guarantees
• A dedicated account manager / primary point of contact
• Strategy calls to align the website with business goals

The “Rule of Three” for calculating your costs

If you’re staring at a blank spreadsheet wondering how to pick numbers, use this simple formula.

1. Calculate your hard costs.
   Hosting plus paid plugins/tools (backups, security, etc.). Call that X.
2. Calculate your time.
   Estimate monthly hours (2? 5?). Multiply by your hourly rate (e.g., $100/hr). Call that Y.
3. Add the risk multiplier.
   Add buffer for the “oh no” factor. Multiply (X + Y) by 1.5 or 2.

This ensures you aren’t just breaking even. You’re being paid for the peace of mind you provide.

Common mistakes to avoid

Nickel-and-diming

Don’t charge a client an extra $15 because they asked you to update a blog post. If you’re on a retainer, absorb the small stuff. It builds trust. Save the overage billing for major projects (like building a new landing page).

Using cheap hosting

If you’re putting clients on a $3.99 shared hosting plan to maximize profit margin, you’re building a house on a shaky foundation. You’ll spend all your time fighting slow speeds and outages. Use enterprise-grade partners so your life is easier.

One-year contracts

Try to bill retainers monthly but lock clients into a 12-month term. It stabilizes your cash flow and ensures you aren’t renegotiating pricing every 30 days.

The bottom line

Your hosting retainer isn’t just about server space. It’s a retainer for your sanity.

When you price correctly, you filter out the clients who don’t value your work, and you attract the ones who understand that a website is a business asset that needs care.

Charge what you’re worth. Sleep better at night. And let the hosting infrastructure do the heavy lifting while you cash the checks.

Part of the Insights series. Next: Managed WordPress Hosting vs DIY.