It doesn’t matter if you’re a solo attorney or partner at a midsize firm: consistent cash flow can make or break your business.
Historically, law firms have resorted to billing clients using paper invoices, then waiting for checks to be returned by mail, a process that can easily take months from start to finish. While many firms have started sending clients invoices electronically via PDF or billing software, even those that have modernized their invoicing practices are still reporting that their main form of payment is the archaic paper check.
Let’s take a minute to get real: your clients are just like you, bombarded with tasks, emails and the everyday priorities of life. Their days are driven by digital communication, and they expect nearly instantaneous responses. In our ever-evolving world only those that adapt will survive, and the most successful law firms have figured out how to do so easily to ensure their invoices and payments don’t get lost in the digital mix.
Read on to learn about three simple processes used by law firms who are not just keeping up with the times but setting a standard of excellence in law firm client service.
1. Consistent Invoice Dates
By billing your clients immediately or on the same date every month you set the expectation that you should also be paid efficiently. When bills go out late or erratically the client assumes that the billing process is relatively informal. No surprise, they also pay in the same way: late or erratically. Set the right example, put a process in place that lets your clients know that your firm is efficient and you’ll improve the chances they’ll follow suit, and pay promptly as well.
2. Excellent Detail and Explanation of Charges
A lack of invoice detail is usually caused by billing time at the end of the week or month instead of tracking and entering your time contemporaneously, when the work is performed. This can cause client confusion or worse, client amnesia. Whether your billing practices confuse your client or take so long they forget the work you did almost entirely, the result is often giving the client a discount or reducing your bill. Successful law firms create and enforce a contemporaneous (or as close as possible) billing and invoicing policy and train all staff members to adhere to the policy. Those that do so are able to consistently and naturally produce more accurate descriptions of the work performed than those that recreate or enter their time at the end of the week or month. An firms that record time as they go don’t just reap the reward of happier clients who don’t demand discounts, they also collect 25% to 50% more revenue every month than firms that do not.
3. Offer Compliant Electronic Payments For Advanced & Earned Fees
Take a moment to think about all the goods and services you consume by paying digitally with a credit / debit card or bank transfer. Now think about the last time you got stuck behind someone at the grocery store paying via check. The only thing more annoying is using a service provider that makes you pull out your dusty checkbook to pay them rather than allowing you to do so from your laptop or phone. Your firm’s clients don’t feel any differently: if you aren’t giving them an e-payment option you’re likely causing them major frustration. Modern, successful law firms know that sending the client a link to pay an invoice online is a standard practice. By requesting that all clients pay with a card or eCheck, you’re also setting the expectation that your firm embraces efficiency, even in the way you get paid.
Bottom line: these three habits directly impact your firm’s bottom line and financial success. As an owner or administrator, it’s your duty to improve processes that contribute to maintaining consistent cash flow needed to run the business. By taking these steps, your firm sets clear expectations with clients about the services you provide and how and when you prefer to be paid for them.
To learn more about how Headnote clients are moving to online payments request a demo here.