This article was contributed by our friends at PracticePanther. This practice management software streamlines workflows, supercharges profits, and helps you increase client satisfaction.
Billing clients is foundational to success at any firm, but oftentimes business owners struggle to receive payments on time, if at all. For an essential business function like getting paid, one would think it would be as simple as preparing an invoice and waiting for the payment to roll in. While yes, these two tasks encompass the general framework of legal billing, your firm is missing out on opportunities between these endpoints to maximize your payment efficiency. Here are five ways to ensure your clients pay on time.
1. Provide concise and public communication on your billing policy
The first step your firm should take is to establish consistent rates and present them in a format that anyone can understand. Make sure to have a transparent conversation with your clients during your initial consultations about these billing structures. This sets you up for success in a few ways:
- It proves to your client that you are transparent and won’t haggle with them on fees.
- It sets expectations for the client so they know exactly what they are paying for.
- It provides a clear roadmap for how much is due and when.
2. Offer multiple payment options to clients
It’s no secret that legal services can be expensive, and just like purchasing a house or a car, if clients don’t have the option to pay the way they feel most comfortable, they may walk away. A few alternatives to standard hourly billing include:
Flat Fee Billing – Charging your clients a flat fee for your services allows you to get paid in full, either upfront or at the end of the project. This option is best if there is a specific type of case or project that your firm handles regularly, the fewer surprises the better.
Subscription or Evergreen Trust Replenishment Model – Under this model, you establish a monthly rate and charge the client on an ongoing basis before the work is performed via an evergreen trust deposit replenishment.
Unbundled Services — Unbundled services simply mean that you are offering your clients a choice of services rather than a full package. Clients are more likely to pay if they know they aren’t being charged for unnecessary services.
Payment Plans – Many firms have started allowing their clients to pay over time to help ease the burden of the cost of legal services. It’s a great way to help reduce the burden to your clients while also ensuring that you’ll get paid in full on your bill eventually.
3. Track time as you work
Accurate time tracking provides peace of mind to your clients and will actually yield you more money! According to the ABA, attorneys that wait to capture their time at the end of each week can lose as much as 50% of their billable hours. Being diligent about your timekeeping can be challenging, but the easiest way to stay on top of it is to record your time as it happens using a practice management tool like PracticePanther.
4. Keep clients up to date
Sending your clients regular status updates about upcoming payment deadlines, missed or late payments, or any late fees that are accruing for overdue invoices is crucial to getting paid timely and collecting in full on your invoice. With practice management software, these tasks can even be automated with workflows, meaning you’re providing real value without having to manually send messages.
5. Make payments convenient (and make your clients happier)
You’ve got one last hurdle to overcome before your money is in the bank — actually getting paid. The easier you make this process, the more likely you are to get paid quickly and collect 100% on your billed time. Allowing clients to pay by credit card or eCheck is no longer just a nice thing to have, it’s a standard operating procedure.
Making your legal payments process as convenient and comfortable as checking out at an online retailer will ensure that your clients pay on time, every time. Learn more about how online payments can positively impact your bottom line by clicking here.
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