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LawBiz® TIPS – Week of October 13, 2015

LawBiz(r) newsletter

Get ready for Halloween ... In Sleepy Hollow, New York, this is the holiday of the year and visitors are enjoying an "Indian Summer." And I'm enjoying grandchildren.

Many businesses are getting ready to go into slumber for the next quarter of holidays and cold weather. How is this seasonality affecting your practice?

Call if you want to discuss how to address this issue and be more succssful.

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Raising Fees: Simple as 1, 2, 3

Raising fees is a natural part of any business, and that includes the practice of law. Just as natural, though, is trepidation about how to go about raising fees. Although an intimidating prospect, raising fees is not as difficult as it may sound.

Your fee-raising plan should occur in three stages: new clients, new matters from existing clients who are not the mainstay of your business, and, finally, all other clients.

New Clients

The safest way to introduce an increase in fees is by testing the waters with brand-new clients—meaning those for whom you haven't yet done work and therefore those whom you aren't as worried about losing. Do not tell these new clients that your rate is an increased rate. Since they are new, they won't know what the old rate was. This is what the rate is, period.

New Matters from Existing Clients

If those clients readily accept the increased rate, then you should move to the next level by increasing rates on new matters that come in from existing clients who are not your bread and butter. You are required to inform existing clients of any fee increases, and the appropriate way is to amend your engagement agreement. A short note is all that's required; long explanations imply uncertainty and apology—when no apology is needed.

Other Clients

After you are confident with these preliminary forays into higher fees, roll out your new fee structure to all remaining clients. With major clients, always talk personally with them in advance of any formal notice of a fee increase. Confirm with them that a fee increase still fits within their budget. Doing this highlights your sensitivity to their economics and takes their opinion into account. If they say no, consider compromising by getting their agreement that you will retain their fee at the current level for a specified time, after which they will need to accept the increase.



Raising Fees: Simple as 1, 2, 3

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LawBiz® Registry: Buy or Sell Your Practice

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