Flexible About Billing? Tell Your Clients!

Most firms use a billing options analysis to determine the mix of hourly rates used to accomplish the work. However, almost any case or project can be broken into tasks; and each task can be priced separately and differently, to create multiple pricing schemes within a single transaction based on client preferences and value perceptions.

Different clients can be approached differently. Creating a matrix can demonstrate to clients those areas where costs can be controlled and where costs are inherent, and educate clients about what can be done to lower the overall cost of a project.

Here is one example of such a matrix applied to an acquisition transaction. It shows various steps in the process, and whether they could be billed at the hourly rate of each attorney, a blend or average of all hourly rates, a fixed price, or a percentage of the transaction value.

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Adapted by permission from the just-published Business Competency for Lawyers: a LawBiz Management Special Report, by Ed Poll. This section goes on to explain how individual work performance standards (such as response times) can also be adjusted to fairly accommodate especially price-sensitive clients. The book is available from www.lawbiz.com or 800-837-5880.

Most firms use a billing options analysis to determine the mix of hourly rates used to accomplish the work. However, almost any case or project can be broken into tasks; and each task can be priced separately and differently, to create multiple pricing schemes within a single transaction based on client preferences and value perceptions.

Different clients can be approached differently. Creating a matrix can demonstrate to clients those areas where costs can be controlled and where costs are inherent, and educate clients about what can be done to lower the overall cost of a project.

Here is one example of such a matrix applied to an acquisition transaction. It shows various steps in the process, and whether they could be billed at the hourly rate of each attorney, a blend or average of all hourly rates, a fixed price, or a percentage of the transaction value.

[IMGCAP(1)]

Adapted by permission from the just-published Business Competency for Lawyers: a LawBiz Management Special Report, by Ed Poll. This section goes on to explain how individual work performance standards (such as response times) can also be adjusted to fairly accommodate especially price-sensitive clients. The book is available from www.lawbiz.com or 800-837-5880.