Making it easier to grow your law firm

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This section covers succession, specialisation, mergers, selling a law firm, becoming a partner, and business structure

How to set up your firm’s systems to provide the information that enables you to improve profitability and cashflow

How to avoid professional negligence claims, with examples of common problems and suggested solutions. Plus FAQs on PII

This is a new section and only covers SRA Accounts Rules and GDPR at the moment. Compliance for start-ups is covered in the Starting up section.

How to protect your law firm from cyber attacks. What steps to take if your systems are hacked

How to recruit and retain a team that is both happy and highly effective, dealing with the HR issues along the way

In marketing, like anything, you need to get the basics right. Otherwise the time and money you invest in marketing will be wasted

How to win new clients, make the most of existing relationships, encourage referrals and generate new leads

How to approach creating a law firm website that works, from agreeing your objectives to making sure you get the results you want

Why lawyers need to know about social media, how to make the most of the opportunities and how to avoid potential pitfalls

How to use PR to build your firm’s reputation; and how to create cost-effective advertising – traditional and online – that delivers results

How to plan and execute the process of starting up a new legal practice that is compliant and financially healthy

Pricing checklist for law firms

Richard AllenGetting your pricing right is usually the fastest way to transform the profitability of any law firm. Richard Allen, a senior consultant with Burcher Jennings, lists 14 pricing steps that can make a huge difference. (2 March 2021)

 

 

  1. Listen to your client fully, to understand the client and the context surrounding the work in question – so you understand what value means to this client, on this specific matter.
  2. Work out what it will take to get the job done (scope, assumptions and exclusions).
  3. Document the arrangement fully, with accurate (yet concise) scope, assumptions and exclusions. Assumptions in particular provide you with a yardstick against which to measure any mission creep, enabling a renegotiation of the price further down the line.
  4. Consider how various factors should affect the pricing (in line with the costs regulations):
    • the complexity of the matter, or the difficulty of the questions raised
    • the skill, knowledge and responsibility involved
    • the time spent
    • the place and circumstances in which the business is transacted
    • the amount of money, or value of property involved
    • the importance of the matter to the client
  5. Offer your client at least two pricing options. Having a choice will reduce the tension the client feels around pricing and will assist you in achieving ‘value alignment’.
  6. Discuss the pricing with your client. Pricing should be a collaborative process, to get the all-important value alignment right.
  7. Avoid diluting your brand by offering discounts when a client shows displeasure at your price.
  8. Only discount on fees for upfront payment, which can greatly assist cash flow. A discount of 5-10% is usually about right, depending on the client and your own cash flow needs.
  9. Proactively manage the matter, since every matter is a project requiring active management – especially foresight around mission creep.
  10. Review progress at regular intervals to ensure work-in-progress and disbursements are in line with your initial scope, assumptions and exclusions.
  11. Make your client aware of any areas where costs and disbursements might increase and engage with them immediately if mission creep and increases do occur – then immediately re-frame the price and re-document the retainer.
  12. Use case management, finance and reporting software to track actual costs against proposals – and produce actionable insights from your pricing successes and failures.
  13. Set up and then consistently follow a pricing policy, setting out the steps you take each and every time a price is set for a client of the firm.
  14. Automate the production of sophisticated pricing proposals, avoiding the need for ‘heavy lifting’ by fee-earners – freeing up their time and ensuring consistency.

 

See also:

  1. Pricing for law firms
  2. Recovering legal costs successfully
  3. How to maximise utilisation and minimise lock-up

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