I attended a conference organised by Netlaw Media on “Key Strategies for Law Firms During a Downturn” yesterday, where a lot of good information and ideas were presented. The pick of the day for me was from Mike Gannaway working at the sharp end as Director of Marketing & Business Development at Denton Wilde Sapte – when he talked about winning and retaining work with commercial clients; fortunately, reinforcing our advice and support for our clients.
Having made the point that cost is top of the agenda for most business clients today, when every commercial lawyer should understand that any business using legal services has to consider options to get their costs down – the key message was:
“Don’t let the client call you to have that discussion. Make sure you call them first to position yourself with a positive starting point!”
Take the initiative now, rather than allow yourself to be backed into just a defensive position where it feels like the only way out is to discount your fees now … and the next time … and the next.
But before you make that call, it would be good to understand what kind of service you are offering. Is it one that can easily be provided by others at a lower cost … or not? If it is, be prepared to compete on costs aggressively and make sure your business can deliver at a profit.
- The trend over the next 12 months will be for law firms to move to a lower cost base to be able to compete at a profit; but,
- The number one threat for law firms is not to make that shift quickly enough.
[From what we see at Inpractice, too many firms are not moving fast enough to streamline processes; where there has been complacency in the past when fees were not such an issue. Particularly in relation to routine commercial and commercial property transactions and internal back office processes. This needs to change quickly.]
To develop a successful relationship:
- Get in first – you make the running with the client so you can move to a positive starting point for a later discussion. Don’t wait for them to call you, which will put you in defensive mode.
- Lead discussions by getting a mutual understanding of the business needs and how your firm can help them during this current difficult period; Find out if you have to compete on costs by getting a mutual understanding of your relationship.
- Explore options beyond costs. Be innovative to agree a way forwards in the relationship with the person or team you are working with. Always, in the back of your mind, ask yourself:
“How can we make them look good?”
- Be prepared on cost where you have to compete. In areas of your portfolio that are highly cost sensitive, you have to be structured to deliver lower legal costs. Know how far you can go and why before you start the discussion.
- Don’t concede on fees where you don’t have to. Know where the client will find it difficult to replace you and / or where use of your services are strategically important to them;
To take this proactive approach requires lawyers to:
- Be pro-active in leading the relationships;
- Be equipped with the right information to address, record and share these discussions with confidence.
- Take a structured and shared approach to developing business and client relationships; and,
- Make a shift of mindset, so that the first thoughts and plans in developing relationships are about delivering what the client really wants and needs, rather than how much closer their fees will get the lawyer to their targets;
Contact us here for more information or call +44 (0)161 929 8355. Independent, objective and impartial client and introducer reviews are a routine part