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‘Charging Order: Nowadays, You’ve Got to Communicate Total Cost of Representation to Potential Clients’
Law firms have traditionally hewn to an hourly billing model; and, in doing so, have been reticent to quote legal consumers anything outside of an hourly rate. Of course, that’s of little comfort for legal consumers, who already think that attorneys are expensive and greedy, to be told that they will be charged a high billable rate until . . . the case is done, whenever that is.
For consumers who are used to paying low monthly rates for high-value services (think Disney+ or HBO Max), paying lots of money per hour for a lawyer, with no discernable end point -- so, no notion of the total cost of engagement -- seems like a pretty risky proposition. It’s the rare consumer who will confidently enter such an open-ended arrangement these days.
That’s why legal consumers have two prominent questions they want answered from attorneys, which questions both get after the same answer. They want to understand the legal process; and, they want to know the total cost of engagement. The total cost of engagement is the thing, though -- asking about the legal process is a way to gain some familiarity, but also another way to try to target total cost.
So, the question that you must be able to answer, as an attorney, for your leads, relates to the total cost of the engagement, not the cost of your hourly rate. Thus, if you can’t answer that total cost question directly, via the use of a flat fee or a subscription offering, it’s a matter of how close you can come.
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The Rhode Island Bar Association offers free law practice management consulting services through Red Cave Law Firm Consulting. To request a consult, visit the Rhode Island Bar’s law practice management page, and start running your law firm like a business.