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Explaining why lawyers can (and should) bill more
Too often, the invoices issued by lawyers are not commensurate with the work undertaken. Here, Ben Deverson outlines the mindset that such practitioners must adopt to be paid accordingly.
Jerome Doraisamy
Ben Deverson – who is the founder and director of legal business advisory firm Lawganised – recently spoke on The Lawyers Weekly Show, said that legal professionals are too nice when it comes to their fees and billing, and that they need to stop undercharging for fear of “bill shock” from a client, among other reasons.
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In that conversation, he outlined what he calls the “retail mindset” that lawyers need to adopt if they are to issue invoices that are not only more in line with the work that has been completed, but are also paid promptly.
That mindset, he said, is aided by three primary analogies.
Firstly, he said, lawyers should think of the process of walking into an Apple Store to buy a new iPhone.
“When you walk into Apple and you pick up the latest and greatest iPhone 12, you don’t walk out with that phone, wave to the Apple staff and say, ‘I’ll pay you in 45 days’. What you do, as you leave the store, is pay for it there and then,” he said.
“Yes, a professional service such as the provision of legal services is slightly different, but there is nothing wrong with seeking funds in trust, delivering the work and invoicing it straightaway. And if you have certain elements of your cost agreement and your trust accounting in order, you can take that money immediately.
“That’s what I mean by services rendered and paid straight away, because there are far too many firms out there that allow over a hundred days from issuing a bill to receive funds.”
Secondly, Mr Deverson referred to what he called the “banquet analogy”.
“If you were having a banquet in a restaurant and the banquet says that you get six dishes, and then halfway through the banquet, you say, ‘We want to add three more’, then you pay more. You don’t leave that restaurant thinking you’re only going to pay for the initial six,” he argued.
“Again, if you’ve got a fixed fee on a matter and the client suggests that they want to see more and more occur, then you add those items to the fee.”
Finally, he said that there can and should be “no renegotiation at the checkout” – something that applies to both the Apple Store and banquet scenarios.
“You don’t stand at the checkout and say, ‘I really don’t think I’ve got value for that phone’, or, ‘I really don’t think that seventh item at the banquet was great, and I’m only going to pay for the first six’. It just doesn’t happen, unless of course there is a considerable problem and one of your guests is on the floor throwing up. Let’s not go down that path, but that retail mindset has to be adopted,” he said.
Mr Deverson said that he believes there has to be a “little bit more strength” in the conversation from lawyers in saying that they provide the service and they expect to be paid.
“Now, there is a way of saying that in an appropriate manner, but that’s what the key elements are. Services are provided, fees are rendered, that’s it. It’s not a case of saying that the third dish in the banquet wasn’t great and that the restaurant can take it off the bill. It’s just far too easy, in my view. More strength is needed,” he said.
The transcript of this podcast episode was slightly edited for publishing purposes. To listen to the full conversation with Ben Deverson, click below:
