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Year end collection push

I am heartened by the many Collections projects we were involved with last year. These projects will have made a major difference to these firms final collection numbers and more importantly the effort required to collect these amounts.

Law Firms Press to Get Bills Paid by Year-End
http://online.wsj.com/news/articles/SB10001424052702304773104579270470475326780

The critical number in here was the drop in total recovery rates have dipped from 90% in 2007 down to 83.5% in 2013.  

There are some simple measures to improve your Collections which firms can implement :-

1) Review payment terms. Consider 7 and 14 day accounts.
2) Look at your payment options do you make electronic payment easy?
3) Do you deliver bills electronically as PDF? They are faster and match the expectation of clients for quality and authorization.
4) Have you reviewed your client payment requirements? Some bill consolidation services are too expensive in the long run. Negotiate accordingly or leave these clients to your competitors.
5) Do you have File Opening procedures to ensure bad payors do not get through, and once identified are locked out?

Dave Callahan from Select*Associates commented that " This 6.5% dip represents the thin margin between profitability and uncertainty for many Law Firms. "

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Billing quick wins

Billing quick wins
How you bill your clients makes a big difference to cash flow. The way you bill has everything to do with how payment will be made. Are you giving your clients an easy excuse to not pay you?


1. State the payment terms
Firms traditionally offer credit easily. Whilst new clients are accepted through a risk analysis process the voice of the Credit Controller is not heard enough. These processes should identify potential risks through references to available searches and past history including the firm’s own records.

Before you offer credit make sure you agree and negotiate the terms of payment. You do not have to accept the 30 days from the end of the month the invoice was received. You are allowed to ask for a shorter term. What is important is that the client understands the terms and agrees to these terms before you start the matter. As a reminder, always ensure that the payment terms are listed on every bill. State the actual due date which is more effective than just…