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June 17, 2004


John W

My $.02 as a GC and consumer of corporate legal services.

Over the long run, I like the move to flat rate or value pricing. A colleague of mine (former GC) has set up an IP/transactional practice partly built on this model. Basically phone calls/documents/counselling are included; not major transactions or litigation. He reviews the monthly fee with clients every 6 months to see if too high or too low. He finds it encourages people to call and use him without having "sticker shock" when the bill arrives. It also allows the smaller, growing clients to better budget for legal services.

The flat rate pricing seems to work better with existing clients or those coming with a strong referral.

I wouldn't find the weekly meeting an appealing part of the plan; few matters require that. My colleague runs his practice (for now) out of his home; the clients don't care and if he needs to meet it's often Starbuck's and he picks up the Mocha Frap (and doesn't charge it back!).

I think the key is to examine what people historically don't like about lawyers (cost too much, take too long; don't communicate effectively or often) and make your pricing and service overcome these objections.

I have been after my colleague to raise his rates, which are now up about 15% from when he started. Even now, he still is well under what the large firms charge, yet he nets more since his overhead is low.

I don't think the pricing model necessarily gets clients, but it may help keep them and helps them become strong referral sources.

Good luck...

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