Profitable Change: Small Firm Solo Lawyers See Benefits of Payment, Firm Administration Changes During Pandemic

As 2022 approached, some independent attorneys and smaller Hoosier law firms were optimistic about the months ahead.

Of course, the COVID-19 pandemic hasn’t spared the legal industry, with roughly half of all small firms reporting in Thomson Reuters’ 2021 State of Small Law Firms in the U.S. that they endured a moderate or significant struggle to get paid by customers. over the past two years. Many also expressed concerns about acquiring new business.

But companies that have created a focused approach to solving their payment issues have seen quick and positive results. In the same way, small businesses have also had the opportunity to establish stronger roots and practice methods for attracting and retaining customers.

While some sole proprietorships and small businesses in Indiana need not worry about not getting paid, they still said improvements to their billing and administration practices have already proven beneficial. for them and their customers.

Revenue management

Getting paid by clients was at least a moderate challenge for 45% of respondents and a significant challenge for 19%, in 2020, according to Thomson Reuters’ 2020 State of Small Law Firms in the United States report. Meanwhile, 43% said they not only had a plan to fix the problem, but had already implemented changes to fix the problem.

Around 76% in the 2020 report also said they encountered at least a moderate challenge in acquiring new customers, but only 29% said they had implemented changes to address this issue.

The situation was slightly better in 2021, when 41% said getting paid was a moderate challenge and 12% said it was a big challenge. As for acquiring new customers, 75% said the show posed a moderate or great challenge.

Some of the most common responses to these challenges were increasing and monitoring billing rates, increasing deposits, improving or increasing payment collection, and accepting debit or credit cards. as well as ACH payments.

These changes were made largely to improve billing transparency and accountability or to make it easier to do business with the company, thereby increasing the likelihood of receiving payment.

Although some Indiana businesses have not experienced payment difficulties, they have noticed a positive impact from their recently updated billing and office practices implemented before and during the pandemic.

Donna Bays

Implementing an automatic credit card payment contract system for the majority of her clients was a key reason Zionsville solo attorney Donna Bays said her law firm hadn’t had any problems receiving payment from customers during the pandemic.

“At the time we are held, they sign a pre-authorization so that we can charge their credit cards each month 10 days after billing,” Bays explained. “LawPay helped us generate the forms for this. This is probably the most effective business practice we have implemented in recent years.

Bays’ family law firm began experimenting with credit card self-pay in 2018. At the time, she thought, “If I have to pay for all my utilities through self-pay, why can’t my clients do the same?

“And it worked,” she said. In fact, Bays said his customers feel more comfortable making automatic payments online than writing a check.

“They just know it happens. And frankly, it makes their bank become their creditor instead of me,” she said.

Evansville attorneys Bradley J. Salmon and Charles S. Hewins, two former independent practitioners who merged firms in early 2022, said unmet payments were also not an issue for their clients.

“A big reason for our merger is that our customer loyalty, customer relationships, billing practices and general philosophies were already well aligned,” Hewins said. “For our billable/flat-rate customers, we actually haven’t seen an increase in unpaid accounts in the last two to three years.”

Hewins, who said there will most likely always be a small number of delinquent accounts, said his firm’s contingency fee clients have also had no trouble paying.

“During the pandemic, our main concern hasn’t been getting paid by signed clients,” he said. “We were rather worried about whether the steady stream of new clients seeking service would dry up.”

Acquiring and retaining new customers has remained a moderate concern for 50% of respondents over the past two years. This same concern was present for Hewins’ business, but he said that while there was a slight reduction in customer demand, their overall retention percentage for new customer inquiries has increased. Why?

“Because we focused on accessibility,” Hewins said.

Focusing on accessibility included creating an easier experience for customers through alternative meeting methods such as Zoom, as well as before and after-hours appointments.

“We used the ‘time off’ the pandemic gave us to teach ourselves how to improve the customer experience,” Hewins said. “Thanks to that focus, now that things are back to normal, business has boomed.”

Yasmin Strain

Indianapolis attorney Yasmin Stump of Yasmin L. Stump Law Group PC said her small firm was fortunate not to be limited by payment issues during the pandemic, primarily because the clients they represent include government entities and Fortune 500 companies.

“We have, for the most part, long-standing relationships with our customers, many of them,” Stump said.

Like Hewins and Bays, Stump said his company implemented changes during the pandemic as an opportunity to do business in a new way.

“We actually expanded our offices during COVID-19,” she said. “We actually created a media room that would be set up all the time for virtual conferences, which we found to be very, very cost effective and efficient, both for our clients and for us as well.”

Pro-active approach

For sole proprietorships and small businesses that saw payment issues or opportunities to expand their business offerings, a common theme remained: they made an intentional effort to improve and saw positive results.

Hewins said the pandemic has helped his law firm realize that providing clients with unique ways to meet legal needs is a good business decision.

Stump said if a solo business or a small business gets in on it, they too could experience the same positive transformation.

“I think, although sometimes it’s painful to go through the process of implementing a new plan, and there are people who are going to resist it, because you know, that’s not the way which they’ve done things before,” Stump said. , “a plan and management that at all levels reduce inefficiencies can bring about very positive improvements for the management and administration of the business.”•


Source link

Elaine R. Knight