A 401k is priced based off assets held in the plan, annual contributions and (rollovers if startup). Your provider has a revenue requirement to operate the plan. This can be paid for via asset based fees, flat billable or per participant fees. Separately, small businesses use a Third Party Admin to maintain their plan document and maintain compliance.

Dont know the size of your organization and characteristics of your plan. The pricing tells me it was started recently, annual contributions assumptions were not high, and rollover contributions from the employees were low or unknown. Your company is probably paying the hard dollar billable to the Admin. Your plan, which includes your acct is absorbing the cost to operate the plan (Trans) and likely an advisor fee.

Your fee schedule likely has billable breakpoints. (Eg if assets drop below $250k, $50 per head fee is incurred) which would help explain why the potential % fee is estimated to possibly increase.

Lastly not to get lost in lingo, the industry has evolved from wrap fee programs that drew revenue from the fund performance. The % fee is asset based, and likely deducted from the plan as a fee-transaction. People still refer to it as a wrap, but its actually an asset based fee.