The market says rates can go higher
There has been recent discussion among some of the smaller law firms about reasonable (ABA standard) and unconscionable (California standard) fees. Unfortunately, this is a back-look standard where Monday-morning-quarterbacking reigns supreme.
There is no standard of which I’m aware, going forward, that guides lawyers about the reasonableness of fees. Thus, we’re left with the market place. Isn’t that how it should be? Not when a client complains about fees to the State Bar’s disciplinary board. Then, the board will review the matter and make a judgment call after-the-fact, and usually against the lawyer.
In my coaching of lawyers, one of the first areas of inquiry is usually the lawyer’s fee. In contrasting this fee with the market place, I find that the market says the lawyer’s rate can be increased. Thus, if you want to increase your revenue, increase your fee. Tom Collins suggests several ways to approach the topic of your effective rate, not just your fee.
See my article about when and how to raise your fees. Clients do not object to modest increases periodically. They do object to sudden, or high, increases. This will get their attention and their ire, as well as start them looking for new counsel.
Thus, as we begin 2007, review your business model with particular attention to how your pricing strategy impacts your market for legal services.Tags: Cash Flow - Finances
Categorized in: Cash Flow - Finances