The question of money is central to all firms – new or established. Without cash flow, you can’t make your overhead; you can’t pay your salaries; you can’t invest in marketing initiatives or take advantage of expansion opportunities. And so, when lawyers begin thinking about a new practice - along with choosing a name, a logo, finding a location, researching software tools and setting out a marketing plan - they must also think of the fees they will charge.
Many lawyers still think this means deciding if they will bill by the hour or bill flat rates. That is, in my opinion, entirely the wrong question in 2019.
Lawyers should be charging flat fees. Almost every time.
The benefits are clear and enormous. Clients prefer price certainty. Clients, in fact, demand price certainty. Offering price certainty often removes the need to “sell yourself” on price at all. Flat fees offer massive marketing and advertising opportunities. Flat fees make for easy budget projections on a monthly, quarterly, or annual basis. Flat fees allow the firm to (partially) dispense with trust deposit retainers and simplify your accounting. Flat fees provide clear incentive to make the firm’s processes more efficient than its competitors.
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