With Validatum Pricing Espresso® we aim to bring you your regular pricing 'shot' - the best, most interesting, thought provoking and informative material we can find globally which will be of interest, relevance and help to you in your legal services pricing challenges. [Note: we don't always agree with the content of others that we post but the philosophy of Validatum Pricing Espresso® is shared perspectives, not a personal 'soap-box']
Law Firms' Unpaid Bills Are Piling Up. No Reason to Worry—Yet
Firms are sitting on a bigger pile of unpaid bills this year, due to more work and slower payments from clients.
How bad will the collections crunch be this year? Inventory is up, clients are taking longer to pay bills,and the coming weeks will be a critical time for law firms to turn client bills into cash.
Law firms are sitting on a growing pile of bills they haven’t sent out or their clients haven’t paid yet, but financial observers and at least one law firm leader said this kind of behavior isn’t causing alarm bells to go off—yet. Read more...
Master Class Pricing Legal Services
An Online Course for Buyers and Sellers of Legal Services
Pricing legal services can be quite challenging. In this four-part Master Class Pricing Legal Services, you will learn how to price legal services. Pay the right price for the value you receive:
- Forecast and scope multi-year demand for legal services
- Predict and reduce legal fees Read more...
Billing Guidelines Are Failing To Be Heard: ALA Survey
Outside counsel guidelines (OCG) for legal matter billing are failing to be heard, or acted upon, by a notable proportion of law firms, a US survey has found. This matters, as it creates work by lawyers that may not get paid for, and it also results in unnecessarily larger bills for clients that could have been avoided. One way of avoiding this problem is to have better processes and tech solutions in place, the survey concluded.
The survey by ALA, the Association of Legal Administrators, and supported by Bellefield, a timekeeping software company, contacted a wide variety of firms across the US, from small to large. Read more...
Weil Facing Sharp Fee Objections in Ditech Bankruptcy
The New York law firm was one of several firms overbilling for services in the Chapter 11 case of a mortgage company, the U.S. trustee found in a review of final fee applications.
A trustee is asking a New York bankruptcy judge to slash fees of Weil, Gotshal & Manges and other law firms, criticizing their billing tactics and invoices in the ongoing reorganization of a mortgage origination and servicing business.
The fee applications in the Chapter 11 case of Ditech Holding Corp. “reflect numerous instances of questionable billing judgment and overstaffing,” said the U.S. Trustee’s Office in New York in Dec. 5 court papers. Read more...
Acing Client Communications: How to Explain an Increase in Your Rates
After doing your research on trends in billing rates, you’ve decided to raise your own rates. It can feel uncomfortable. Some of us are reluctant to really charge what we are worth or feel bad about increasing rates for longtime clients. We may struggle with being in a high-rent market, such as New York or San Francisco, while serving clients in other locales used to paying lower regional rates.
But, while clients may not be overjoyed to receive the announcement that their rates are increasing, they are used to receiving such news. Read more...
CMS lawyers add 'innovative' work to billable hours target
Lawyers at CMS will be able to count hours spent on 'innovative' work towards their billable hours target, the global firm announced today in the legal sector's latest attempt to ape Silicon Valley culture.
The top 10 global firm said its 'innovation hours' scheme has been designed to reward efforts targeted at improving the business and enhancing client service. It was inspired by #hacks, the firm's 'ideas sharing portal'.
Projects will need to have a clear business benefit that 'goes aboves and beyond the innovation activity expected of everyone under CMS’ performance framework', be within sensible time and cost boundaries, and be within budget. Read more...
US firms write off up to fifth of fees due to 'overwhelming' billing demands
Survey of nearly 200 law firms calculates that outside counsel guidelines are costing some firms $4m a year
US law firms are writing off up to 20% of their fees as they struggle to comply with their clients’ onerous billing requirements, a survey of nearly 200 law firms has found. According to the inaugural Law Firm Leader Survey on Outside Counsel Guidelines (OCG), some law firms are losing $15,000 a day - or nearly $4m a year – thanks to their ongoing struggle to comply with their clients’ demands. Read more...
10 Ways That Outside Counsel Disguise Overbilling
The task of sifting through line after line of attorney time entries from outside counsel is time consuming, and more times than not, in-house legal and accounting teams may miss billing errors.
Legal invoices can be overwhelming and nearly impossible to understand. The task of sifting through line after line of attorney time entries from outside counsel is time consuming, and more times than not, in-house legal and accounting teams may miss billing errors. Despite the complexity of legal invoices, there are ways to spot overbilling if you know what you are looking for. Read more...
Deferred, fixed pricing can help startups get off the ground
Startup businesses will play a significant role in the evolving corporate marketplace in the future – if they are provided with the right professional support from law firms at the outset, argues one managing partner.
In conversation with Lawyers Weekly, Lehman Walsh managing partner Janya Eighani outlined her firm’s new policy of assisting startups by way of not charging fees until such time as funding has been secured for the aspiring business’ venture.
The firm will operate on a fixed-fee basis with those startups, she said. Read more...