Why It’s a Mistake to Be the Cheapest Lawyer in Town
Are you the cheapest lawyer in town? If so, you are making a top business mistake, according to a law practice management expert.
Discounting fees to bring in more business leads to dissatisfaction for both the lawyer and the client, according to Illinois solo practitioner Timothy Storm, an adjunct law professor at John Marshall Law School. He outlined the top five business mistakes made by lawyers in an interview with the Illinois Bar Journal.
“If my regular hourly rate is $300, and I decide to give you a 50 percent discount, every time I bill you for an hour of time I’m thinking of the $150 I’m not collecting,” Storm explained. The client, on the other hand, is likely thinking, “Your fees were inflated to start with. Your discounted fee is probably also inflated.” As a result, both sides feel cheated.
Another top mistake is to perform legal work now for clients who will pay later. The scenario reminds Storm of Wimpy from the Popeye cartoon, who will gladly pay Tuesday for a hamburger today. Storm says clients who want to pay later are essentially asking for an interest-free loan. Suggest that such clients ask a friend or family member for a loan instead.
Hat tip to ISBA.org.