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Jan Copley
Certified Practice Advisor
Atticus, Inc.

530 South Lake Avenue, Suite 250
Pasadena, CA 91101
(626) 696-3145
(626) 421-6747 (fax)
jan@copleycoaching.com

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How Do You Get Paid?

August 29, 2012

Filed under: Billing,Pricing — @ 8:00 am

When I was practicing, I accepted credit card payments for my services. I used what was then the traditional route — a machine to swipe the card. I paid a percentage of the amount charged to the credit card processor.

It worked well. Hardly anyone carries checkbooks any more and people like to get the airline miles and other perks from using their credit cards. It meant that the credit card company financed payments, rather than me having to take installment payments. It also meant something really important — I got paid for my work.

As a result, I’m always surprised when I hear lawyers resisting taking credit card payments. They very often quote the downside of having to pay a certain percentage of the transaction to the credit card company. My response is that if the credit card company is charging 3%, raise your rates 5%. A client that won’t pay the additional 5% won’t pay what your original charge was, either.

Since I closed my practice, the financial world has created other, perhaps cheaper, ways for you to accept credit cards. Therefore, I thought it would be useful to my readers if I passed along the link to a recent posting, “Five Ways to Receive Credit Card Payments” on the Attorney at Work website. I especially like the concept of accepting credit cards that can go to your trust account — that would make it so much easier to keep an evergreen retainer.

Please let me know how this helps you!

Charging for Staff Time

April 11, 2012

Filed under: Billing — @ 1:16 pm

In my previous blog postings, I’ve talked about setting prices for the work you do as a lawyer. Now, let’s talk about setting prices for your paralegals and other staff people who charge for their time.

How do you set prices for your staff? I bet you’ve set your prices for your team members the same way most attorneys do — by imitating the prices charged by the lawyers down the street.

You can do better than that!

The Rule of Three. At Atticus, we propose that you use something called “The Rule of Three” for your team members who charge for their time. What that means is that any employee who bills his or her time should produce revenue three times the amount of his/her salary.

Why this rule? This is how to break it down:

    1. The first one-third covers the employee’s salary.

    2. The second one-third covers expenses associated with the employee, such as payroll taxes and benefits.

    3. The third one-third is your profit.

Implementing the rule. Do your employees produce income to meet The Rule of Three? If not, there are two things you can do:

    1. Raise your billing employees’ hourly rates.

    2. Set minimum billing standards for your employees. If they know how much billable time is expected of them, they’ll probably meet your expectations.

My guess is that if you follow this simple rule, you’ll make more money. And, since you won’t have increased your overhead, all that extra money will be profit to you.

Please let me know how this helps you!

What Should You Do First?

February 1, 2012

Filed under: Billing,Focus/Time Management,Practice Management,Processes — @ 6:20 pm

When I talk to my coaching clients, many of them express the sense of feeling overwhelmed — they have too much to do and they’re not sure what they should work on first. Thinking you might occasionally feel the same way, I thought I would write about an easy way to decide which projects you should tackle: work first on the cases that will bring you the most money.

You probably have a spreadsheet or some other tracking system listing the open matters in your practice (and if you don’t, you should). You may list the client name, the work to be done, and any deadlines — filing dates or client meetings, perhaps. Why not add another column, listing the amount of money you expect the case to bring in? It will help you really prioritize what you need to do.

Here are two other benefits to keeping this kind of list:

    1. You will have an idea of the amount of money you have in your pipeline. It’s probably more than you think, and that will give you confidence about your practice.

    2. Second, you can watch the amount of work you have coming in and see when your pipeline is not full enough before cash gets tight. You’ll know when it’s time to ramp up your marketing to get more work in the door.

Please let me know how this helps you!

I’m Too Busy to Bill

September 23, 2011

Filed under: Billing,Practice Management,Pricing — @ 8:00 am

I am not kidding, I’ve actually had lawyers tell me that they are “too busy to bill.” That comment always makes me wonder how that person is eating, much less paying the rent!

Now, I know that many attorneys practice because they love the law, but most of us are in it to make a living, too. And making a living requires collecting payment for the services we provide to our clients.

Unfortunately, law school doesn’t teach cash flow management, and many of us start up our business without thinking about the steps involved in actually getting paid. To that end, I have a couple of suggestions:

Be rigorous about billing. Designate specific days, at least once a month, to get the bills out. Don’t schedule any meetings that day, and don’t plan on doing any client work.

Don’t work with deadbeats. Only work with clients who are willing to pay you. If the first words out of a prospect’s mouth are “what is it going to cost?” send that person on his or her way. You don’t lose money on the cases you don’t take.

Figure out a way to capture your time. If you bill hourly and have trouble tracking your time, ask your assistant to interview you at the end of the day about what you have worked on. Have him/her actually create the time records. If you do this, it’s likely you won’t lose as much billable time because you haven’t documented it, and you won’t be subjected to the physical task of logging your time yourself.

Raise your prices. Make sure your prices are high enough so you make a profit. I know that many attorneys are afraid that if they charge too much they’ll lose clients. However, a wise man once told me to think of it this way: if you double your prices and lose half your clients, you’ll still be making the same amount of money.

Please let me know how this helps you!