Don’t be a Victim of your Law Firm’s “No Small Business” Policy

Httpwwwflickrcomphotosfotomele64219608Via MyShingle I learned about this telling article by a leading law firm consulting company.   According to the article, small businesses are bad news for big law firms.  Short of telling the client to hit the road, they recommend these ways to get rid of small business clients:

  • Eliminate discounts. Most businesses provide price
    discounts based on volume. But in law firms, often the lowest rates are
    charged to the smallest clients. With the next bill simply charge the
    client at full rates. Explain that the firm has large clients who
    expect to enjoy most favored nation rates, which forces the firm to
    bring the small client’s rate up to standard. Either the client will
    pay the higher rates or they will seek other counsel–both good results.
  • Push work down.
    Hand off small client relationships to a junior associate. The
    associate will charge lower rates and gain experience in client
    relations and billing management. A year later if the firm still wants
    to fire the client, it can do so with less political flack.
  • Refer it out.
    Refer the client to a smaller law firm. Set up a referral relationship
    and explain to the client that they will be charged less and get better
    service from the smaller firm
    .
  • Cut out small clients at the source.
    Change client acceptance procedures to eliminate small matters.
    Prohibit acceptance of work that particularly attracts individuals and
    small clients. If the firm must accept some individual work, establish
    a fixed fee minimum for individual services such as will preparation or
    residential real estate closings (and make it pretty high).

Emphasis (in red) added by me.   Need I say more?

Picture courtesy of Fotomele protected under CreativeCommons Attribution-NoDerivs 2.0 License.

About Imke Ratschko


Imke Ratschko is a New York Attorney helping small businesses, business owners and entrepreneurs with all things "Small Business Law," such as litigation, contracts, business owner disputes, shareholder and operating agreements, sale or purchase of a business, investors, and starting a business. You can reach her at 212.253.1027.

One comment

  1. If the firm must accept some individual work, establish a fixed fee minimum for individual services such as will preparation or residential real estate closings