Client Connection

Client Connection

Sunday, November 3, 2013

5 Mistakes to Avoid Going into Year-End

1. Expecting Attorneys Will Make the Time Needed to Collect Their Bills -- Let's face it. Attorneys are concerned about servicing their clients, not about when they are going to get paid. They have been trained to be lawyers and provide quality legal work. They only have so many hours in the day and they spend it practicing law. Although managing accounts receivable should be part of their practice management, don't make the mistake of giving them too much autonomy in dealing with them.

2. Believing that Clients Understand Payment Obligations -- Actually, communication problems typically arise very early in the engagement, often because the attorneys and their clients do not share mutual expectations.  Lawyers do not take the time to review payment obligations with clients. The reality is that it is usually the client rather than the lawyer who dictates when -- and, sometimes, if -- payment can be expected. 

3. Fear that Attorneys Will Damage Their Relationships by Asking Clients to Pay Their Bills -- Law firms lose clients by doing poor work or by failing to deliver client service, not by asking clients to pay their bills. Managing and asking for payment status will not hurt the relationship, as long as it is done in a professional manner.

4. Expecting that Clients Will Contact the Law Firm If They Have Problems with Their Bills -- Some clients will, in fact, be quick to call if they perceive a problem. Most, however, will not, for one of many reasons: they are uncomfortable talking about money, they are totally confused by the services described in the bill and don't know where to begin, they are unprepared for the total amount of the bill and find themselves unable to pay.

5. Looking at the Wrong Reports to Help Determine Year-End Payment Expectations -- Many firms still look only at aged accounts receivable reports. They need to go beyond this. Law firms need to know if an account is actively being pursued and what the payment status is. They need to categorize their accounts in order to know why clients are not paying. Most importantly, firms need to be honest with themselves that they have reports that can help them understand what collection efforts, if any, are being performed.

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