The Customer Is Always Right: How to Develop Consumer-Friendly Pricing for Law Firms

Modern law firm consumers are an entirely new breed.  They have more law firm options than ever before, and aren’t afraid to use them.  They are committed to mobile search.  They are more cost-sensitive than any consumer base in modern history.  Absent a near-instantaneous response from a potential lawyer hire, they will immediately move on to the next attorney on their list.

This can be frustrating for law firms, whose billing practices tend to be antiquated.  Hourly billing, without a cap, is perhaps the scariest consumer pricing arrangement there is.  Put yourself in the shoes of your potential client, and ask how appealing it would be to sign an agreement undefined in length, and with a high hourly rate attached.  Furthermore, if you’re asking for retainers, consider whether you’d be able to draw that cashier’s check on your own bank account, on short notice.

The good news is that these two obvious roadblocks to client engagement for law firms admit of straightforward solutions . . . if you’re willing to try them.  To solve for the uncapped fee structure objection: cap your fees.  There are multiple ways to accomplish this, including: adopting flat fees; quoting a set number of hours and giving yourself a bonus if you come in below that number – or, if not, collecting a reduced rate for any hours over that number; or, creating limited scope engagement agreements.  In order to ease the liquidity burden on your clients, allow them to pay you via credit card through electronic payment processing tools.  This will allow your clients to access the funds they need, and removes the collection burden from you: you get paid, and the credit card company collects.

Law practice is a highly competitive market; but, by offering clients modern payment options, you can separate yourself from the pack.

. . .

Is it time for you to revise your rates?  We can help.

The Wyoming State Bar offers free law practice management consulting services through Red Cave Law Firm Consulting.  To request a consult, visit the Wyoming State Bar’s law practice management page, and start running your law firm like a business.

Share on Social Media