The National Creditors Bar Association Law Practice Management Blog

Nothing bottlenecks law firm case process (and progress) as much as waiting for your clients to do things .     Law firms can largely control internal policies & tasks; and, courts utilize definable deadlines .  But, when law firms request that clients do things . . . good luck !  They’ll straight up ignore you .  They’ll obfuscate .  They’ll waste your time, by getting back to you another issue, entirely .   In sum, they mostly won’t give you w hat you want, unless you stay on them.   The question then becomes: How do you do that?     The answer is consistent follow - ups .  Now, lots of law firms employ workflows; but, not a lot of law firms follow - up on client requests , in an aggressive fashion .  The good news is, that this has become easier than ever before, with software automation .  If you need a document . . . or an esignature . . . or a meeting to get calendared . . . You can simply add a set of follow - ups to that request, via a variety of mechanism

Managing a ccounts receivable is all about timing; and so, you can’t view it simply as a lump sum that you are owed.  Ideally, you’re running and reviewing aged accounts receivable reports – which most bookkeepers will do as a matter of course @ 30-day, 60- day and 90-day+ intervals.   That will give you a sense about a lot of things, related to the financial management of your business, including how your cashflow projects, on a go-forward basis.   But, most importantly, you’ll get a sense of how those dollars escalate in your law practice .  That escalation, of course, needs to be matched by your collection process .  When clients don’t pay you, as they should: you can’t just watch the dollars st ack up .  You need to meet that escalating mountain of cash, with a more aggressive collection program .  And, that collection process should be established in your engagement agreement.     There are template clauses accessible online .  But, the general idea is that you want

Lots of small and solo law firms have staggering amounts of accounts receivable; and, even if those numbers are not sky high , for you – smaller amounts are still vexing .  Accounts receivable end up counting against your profitability, because these reduce the amount of gross revenue you collect = the top line for your profit margin .  So, the more you collect : the more you make.   But, what if you have existing accounts receivable ?  Do you just write them off, entirely ?  Now, while it rarely makes sense to sue your clients for unpaid legal bills – there are a whole host of things you can do short of that, which may help you to recoup (at least, some) of your billing .  And, as with most things related to business management, it starts with a process – that you likely don’t have now .  So, the very first thing you can do is followup with folks who have unpaid invoices .  Build up a strategy, same as you would for trying to get someone to book an initial consultation with y