It Begins and Ends with …. Credit Control
Forgive the brevity of the post, but I am taking some time off with the children and won’t be at the computer much.
This post, like all my posts over the past few weeks, is written ahead of time. I have taken a leaf out of Chris Brogan’s book.
Credit controllers, whether in professional services or any other business, get a terrible rap.
Rarely, if ever, have I seen a lawyer thank the person for having recovered a debt which they ran up. If anything, they think of them as an inconvenience and someone who needs to be kept at arm’s length.
Sitting yesterday, in a well known coffee shop in Exeter, I heard two lawyers moaning about their paltry bonuses and the fact that they were not going to be paid because the firm had surreptitiously introduced another hurdle to deny the payment of the bonuses; namely payment of some of their outstanding bills. [Next time guys try not to speak quite so loudly!]
In other words, no cash = no money. They were aghast that this was the case and blamed everyone else for their predicament.
I was sorely tempted to lean over and say:
“Look, are you seriously suggesting that the firm should pay you a bonus of their money when they haven’t been paid?”
The point is that if lawyers thought more carefully about the client relationship they could practically eliminate bad debts. As I keep reminding those lawyers who feel uncomfortable about the whole billing and recoveries process, do they believe their clients would be given goods on the tick from Tesco or ASDA? Not in a million years. So why should legal services be any different?
Money on account should be requested at every conceivable stage of the transaction; payment of the disbursements shouldn’t be allowed from office account save in very rare circumstances; and if the client didn’t pay the bill within the 30-day period then no further work would be done.
Would lawyers adopt such stringent criteria? No.
The reason: They would all be worried to death that their so called clients would walk and go to their nearest competitor who was amenable to providing credit. This all comes down to confidence and believing in yourself, the services that you offer and that the firm and its partners will fully support you. And perhaps crucially you will see the partners adopt the same level of discipline.
If you must resort to a credit control process, then for God’s sake give your credit controller all the help you can muster. Don’t think of him/her as something of the night and only there to give you a hard time. Just think that if your salary was dependent on recovering you fees, as it would if you were operating as a sole proprietor, then would you be so accommodating with your clients?
Rather than harp on about Cash is King change the slogan and say that Credit Control is Queen.
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