In a perfect world, you could invoice a client and get paid immediately. Unfortunately, you have to deal with questions and disputes, which impact your cash flow.
We help law firms remove the stress of having to chase outstanding debtors, give you certainty around your cash flow and provide a positive client billing experience and client onboarding journey.
Our experiences over the last 12 months and particularly during turbulent times have highlighted three habits that help law firms get paid on time
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Breaking billable work down into small payments.
We are naturally averse to parting ways with our money. The pain of paying is a psychological behaviour that suggests parting ways with a large sum of money hurts more than having the payment chunked into smaller intersperse transactions. Consumers have also been found to be more willing to spend more when they use credit or debit cards vs hard cash.
Law firms that invoice in small parcels or regular instalments instead of single upfront deposits or end of matter billing are more likely to have happier clients and more consistent cash flow.
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They make it easy for clients to get started and pay them.
Even though invoicing tools have made it easier for organisations to receive monies owed, simply issuing an invoice with a bank account number on it is a practice from which many industries have moved away. Additionally, asking for a large upfront amount increases resistance to proceed. We found that law firms who provided multiple payment methods had much lower debtor days and a vast reduction in bad debts.
The firms that really stood out and were the most successful in getting paid had an easy and consolidated client onboarding process. Key elements included open and clear communication on the scope of works, electronic client agreement and a payments solution which is effortless for clients to use like Pinch Payments.
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They focus on legal work.
Wait. What?
Shouldn’t invoicing be a priority?
Absolutely. But we are yet to find a lawyer who likes to chase up outstanding invoices.
Lawyers cited the following reasons:
- Negative impact on the client/lawyer relationship and a distraction from the matter;
- Their time could be better spent on completing other billable work; and
- They didn’t have the skills or training to chase outstanding payments efficiently.
Law firms who have adopted new client onboarding best practice have seen a significant reduction in outstanding debtors, a significant increase in customer satisfaction and strong consistent cash flow improvements.
Providing various payment options, breaking billable work into smaller, regular payments and streamlining client onboarding processes come together to complement accounting and debtor management features in your practice management system. Ultimately, delivering improved cash flow, lowering debtor days and bad debts.
Pinch Payments is a payments platform specialising in getting you paid on time. Pinch also automates time-consuming bookkeeping functions so that you can concentrate on your business, decrease conversations about money, create a healthy cash flow and a thriving business. Pinch is a true Aussie focused on supporting Australian businesses to excel beyond their competition.
You can contact us at [email protected], book a time through https://calendly.com/pinchpayments or simply jump on our website www.getpinch.com.au and connect us with your accounting system in minutes.
About The Catalysis Group
At The Catalysis Group, we help law firms remove the stress of having to chase outstanding debtors, give you certainty around your cash flow and provide an amazing client billing experience. We work in partnership with Pinch Payments to design and implement client onboarding journeys. Book a time with James to discuss your system’s needs through https://thecatalysisgroup.com.au/bookings
Click here to find out what law firms think about our services.