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to provide clarity on my fees because: The key to paid invoices is no surprises!
I want my clients completely prepared for any invoices coming their way. I know I don’t like getting an unexpected bill or an invoice for an amount much larger than I anticipated – so I avoid doing that to my clients like the plague!
For this reason (and many others), flat fees are superior to billing hourly. Hourly billing is usually not predictable, which is why so many lawyers don’t get paid. Even if you have a litigation practice, you can implement flat fees in phases and take other steps to make your fees (and therefore invoices) predictable.
2. SEND INVOICES IN A TIMELY MANNER.
If you want to get paid on time, send your invoices on time. This means putting the effort in to systematize your billing process to ensure that your clients are getting their invoices close to when the work is being done. Additionally, if you tell the client their payment will be due every 30 days. Make sure you send the invoice at least two weeks in advance to give them time to pay it. In my experience, giving clients less than 14 days to pay your invoices (meaning you send them a bill that is due in less than 14 days from the send date), leads to late payments. Give your clients as much lead time as possible. Twenty-one days seems to be the magic number to get your invoices paid faster than if you request immediate payment.
3. FOLLOW UP.
People are busy. People forget. People are people. Therefore, if one of your invoices goes unpaid, follow up ... immediately! Have a system in place to contact the client immediately after the due date on an invoice passes – as in, the very next day. For example, my invoice system automatically sends an email message to the client that their invoice is now late the day after the due date. If the invoice is due the 15th and has not been paid by midnight on that date, the very next day they will get an email reminder. This reminder is usually enough to cause the client to make the payment immediately. (More often than not, the client just forgot about the invoice.)
If this doesn’t result in payment, the next step is to contact the client via telephone three days after the invoice due date. Yes, I am suggesting that you actually pick up the phone yourself and call your client to find out what’s going on rather than have an assistant or some outsourced collections company do it. Maybe you think it’s a waste of your time, as a lawyer, to talk to your client about why their invoice isn’t paid. I don’t. In my experience, my client would rather talk with me directly then get an email or phone call from an assistant or unknown party demanding payment. I find giving them a call to find out what’s going on is a more compassionate approach, usually leads to immediate payment, and improves the quality of the ongoing relationship with the client rather than destroying it.
Using these strategies, I have not had an invoice go unpaid in a long time. Try them in your practice and see if they don’t work for you.
Rachel Rodgers started her virtual law practice Rachel Rodgers Law Office in 2010. Today, she offers online workshops to attorneys as well as personal coaching. For more information, visit www.hervirtuallawoffice. com or call 1(855) 803-4769.
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Vol. 1 No. 2 Attorney at Law Magazine® Greater Dallas | 15
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