Too many law firms continue to think collections is an easy process. All you have to do is remind clients to pay and they will.
For firms that thought they had a good A/R management system in place, in a matter of weeks, so much has changed, and it has compelled them to re-think their strategy, presuming there was one.
NOW, more than ever, is the time to understand if, when and how much clients will pay. Cash is king for most clients of law firms these days, and it is difficult for them to let money go because they have so many financial obligations.
Therefore, manage your clients’ expectations so that they know that, if they have not paid, they will be contacted throughout the ageing process. Here are a few tips to help:
- Follow-up regularly and timely with your clients to determine when they will pay. Recognize that your firm is not the only one contacting them for payment status. Always thank them for taking the time to speak with you or respond to your e-mail. Having good dialogue and building a sincere communication exchange will go a long way in helping the firm get paid. Building sincere relationships with your clients, listening to their struggles and developing a path for payment are keys to success.
- Request dates or timing on when payment can be expected to help determine when your next follow-up contact should be made, if payment was not made. If clients cannot give you specific payment dates, at minimum agree when a follow-up call would be good.
Start small by educating your attorneys and staff on the day-to-day best practices for managing A/R in your firm. Then figure out how your firm can actually start getting its arms around its payment expectations – Your goal is to build consensus within your ranks on how timely payment information can be a large part of your firm’s revenue enhancement initiatives.