My Shingle

By Price Alone?

by Carolyn Elefant on March 22, 2006 · 18 comments

in Business Plans, Law Practice Management, Setting and Collecting Fees

Print Friendly

There’s been some discussion on some of the listserves that I frequent about the Brodsky Law Firm which competes, proudly and flagrantly, on price alone.  Predictably, Brodsky’s strategy has generated a slew of remarks like “you get what you pay for” or comments critical of this “race to the bottom,” but I see things a little differently.

Moreover, I’m troubled when lawyers don’t show any concern for the
rapidly increasing cost of legal services.  Let’s face it, lawyers are
expensive, hourly rates are skyrocketing and we need to recognize that
many clients are simply not able to afford adequate legal services.
I’m not saying that lawyers ought to perform pro bono or cut rates or
work for free, but we shouldn’t criticize those lawyers willing to fill
a gap that we ourselves are not willing to serve.  In fact, if given
the choice between a lawyer or a We the People provider offering $200
bankruptcies or $99 incorporations, I’d choose the lawyer any day of
the week.

Now that doesn’t mean that I’m impressed with the Brodsky Law Firm site.  It raises some red flags, including the absence of a lawyer bio at the site.  And I’m not certain that one lawyer could offer such a diverse menu of services.  But the firm is definitely targeting a need, particularly in a high priced jurisdiction like New York.  I don’t think we ought to be critical unless we’re willing to provide those services ourselves.

  • http://blogs.law.harvard.edu/ethicalesq/2006/03/22#a6312 f//k/a

    we need more low-fee lawyers (even in Ohio!)

    When a seller proclaims “you get what you pay for,” you can be certain he’s afraid of price competition

  • http://blogs.law.harvard.edu/ethicalesq/2006/03/22#a6312 f//k/a

    we need more low-fee lawyers (even in Ohio!)

    When a seller proclaims “you get what you pay for,” you can be certain he’s afraid of price competition

  • Mike Adams

    I think that there is a large (and expanding) market for lower cost legal services. With today’s technology, small and solo firms can offer services much more economically that we could just a few years ago.
    I also think that we need to look specifically at the value of the services that we provide our clients instead of worrying about whether we are billing the same hourly rate as the “average” attorney in our areas. A good friend of mine from law school bills his time at around $250 per hour working for a biglaw firm out of Denver. His work on natural resources law is worth every penny he bills. However, if I tried to bill such rates to my typical, middle income families looking for a basic estate plan, I would lose many of my clients.
    I think some in our profession need to realize that not every client needs Cadillac service. Sometimes a basic Chevy is all you need to get you where you are going.

  • Mike Adams

    I think that there is a large (and expanding) market for lower cost legal services. With today’s technology, small and solo firms can offer services much more economically that we could just a few years ago.
    I also think that we need to look specifically at the value of the services that we provide our clients instead of worrying about whether we are billing the same hourly rate as the “average” attorney in our areas. A good friend of mine from law school bills his time at around $250 per hour working for a biglaw firm out of Denver. His work on natural resources law is worth every penny he bills. However, if I tried to bill such rates to my typical, middle income families looking for a basic estate plan, I would lose many of my clients.
    I think some in our profession need to realize that not every client needs Cadillac service. Sometimes a basic Chevy is all you need to get you where you are going.

  • George M. Zuganelis

    I tend to agree that not all legal services need to cost the middle class client a fortune. However, I practice criminal defense in Chicago, IL. I have seen great abuse of lawyers charging “cheap” fees, especially in DUI cases. Their goal is to get as many clients as possible for $250.00, and plead EVERYONE guilty. They don’t have time to try cases, even those cases that should be tried. They don’t even read the police reports and other discovery. They have to move on to other people for their $250.00.
    One lawyer in particular (who is known amongst other defense lawyers as a “walking violation of the sixth amendment”) tried pleading a defendant guilty who had a breath test reading of 0.04, well below the 0.08 nessessary to prove impairment while driving. Thank God the judge refused to take the plea. This “cheap” lawyer withdrew from the case. I’ve never seen him try a case.
    Not all low priced fees are a bargain. Many are just down right “cheap,” in the truest meaning of the word.

  • George M. Zuganelis

    I tend to agree that not all legal services need to cost the middle class client a fortune. However, I practice criminal defense in Chicago, IL. I have seen great abuse of lawyers charging “cheap” fees, especially in DUI cases. Their goal is to get as many clients as possible for $250.00, and plead EVERYONE guilty. They don’t have time to try cases, even those cases that should be tried. They don’t even read the police reports and other discovery. They have to move on to other people for their $250.00.
    One lawyer in particular (who is known amongst other defense lawyers as a “walking violation of the sixth amendment”) tried pleading a defendant guilty who had a breath test reading of 0.04, well below the 0.08 nessessary to prove impairment while driving. Thank God the judge refused to take the plea. This “cheap” lawyer withdrew from the case. I’ve never seen him try a case.
    Not all low priced fees are a bargain. Many are just down right “cheap,” in the truest meaning of the word.

  • http://dysonlaw.justia.net Tamar Israel Dyson

    I read this thread with great interest because determining my fee structure was, and sometimes continues to be, one of my greatest challenges. I felt particularly unequipped because I come from a large firm background replete with the typical excesses of the 1980′s. I had no concept of what to charge a client base consisting of individual people instead of large corporations.
    A significant amount of my practice is pro bono because I donate my services to non-profit organizations that actively crusade the causes that I am passionate about. I have also occasionally used the barter system when I work with new small businesses with promising futures and little capital.
    This flexibility over my pricing schedule is one of the many reasons that became a solo.
    However, I believe that making your reasonable price structure the focal point of your marketing strategy is a mistake. It reminds me of a jewelry chain here in California that advertised for decades that “You can have low credit or no credit you can still get an account at *** ******* ****** !” Not once did the company say one word about the quality of its merchandise.
    I believe clients want reasonable fees. I also believe that their desire for quality legal representation is greater. The best marketing strategy is to provide both.

  • http://dysonlaw.justia.net Tamar Israel Dyson

    I read this thread with great interest because determining my fee structure was, and sometimes continues to be, one of my greatest challenges. I felt particularly unequipped because I come from a large firm background replete with the typical excesses of the 1980′s. I had no concept of what to charge a client base consisting of individual people instead of large corporations.
    A significant amount of my practice is pro bono because I donate my services to non-profit organizations that actively crusade the causes that I am passionate about. I have also occasionally used the barter system when I work with new small businesses with promising futures and little capital.
    This flexibility over my pricing schedule is one of the many reasons that became a solo.
    However, I believe that making your reasonable price structure the focal point of your marketing strategy is a mistake. It reminds me of a jewelry chain here in California that advertised for decades that “You can have low credit or no credit you can still get an account at *** ******* ****** !” Not once did the company say one word about the quality of its merchandise.
    I believe clients want reasonable fees. I also believe that their desire for quality legal representation is greater. The best marketing strategy is to provide both.

  • http://jamestownlawyer.blogspot.com Todd

    One of the problem I face as a new solo offering “Chevy” services is that the bar, rules and infrastructure are geared more toward the entire practice being “Cadillac.” Especially here in a small city without rentable “virtual offices” and the sort of amenities that can help a small practice get by.

  • http://jamestownlawyer.blogspot.com Todd

    One of the problem I face as a new solo offering “Chevy” services is that the bar, rules and infrastructure are geared more toward the entire practice being “Cadillac.” Especially here in a small city without rentable “virtual offices” and the sort of amenities that can help a small practice get by.

  • http://soloinchicago.blogspot.com Peter Olson

    Wal-Mart makes quite a bit of money and I don’t think they’re quite Neiman Marcus.

  • http://soloinchicago.blogspot.com Peter Olson

    Wal-Mart makes quite a bit of money and I don’t think they’re quite Neiman Marcus.

  • http://www.HowToMakeItRain.com RJON ROBINS

    HOW TO PRICE YOUR LEGAL SERVICES TO MAKE MORE MONEY AND MORE HAPPY CLIENTS.
    This discussion thread reminds me of a topic I’ve experimented, spoken and written quite a bit about over the years, first as a solo practitioner and later as a Practice Management Advisor. In my experience practicing law and working with literally thousands of Solos to improve the professionalism and profitability of their law firm businesses, the single biggest impediment to properly pricing a Solo’s legal services is the mistaken belief that a law firm should provide “…only the highest quality legal services.”
    DO ALL YOUR CLIENTS DRIVE A ROLLS ROYCE?
    Our Clients are consumers, and like every other consumer our Clients make choices which they believe to be rational, about how to allocate their limited resources. The fact of the matter is that every day consumers make the choice NOT to buy the highest-quality legal services available, when doing so means foregoing the ability to purchase other products and services with their finite disposable income.
    Think about it for a second, we can all probably agree that a Cadillac is a higher-quality car than a Chevy. So why don’t all your clients drive a Cadillac, or Mercedes, or a Rolls Royce? Sure, for some of them it’s a matter of taste or unique features, but I know the reason I choose not to drive a Rolls Royce is because I’d rather have a nice Chevrolet and spend the difference on my boat instead.
    HOW TO MAKE MORE MONEY
    Actually, I drive a nice Ford but the point from above remains: When deciding how to position your small law firm in the market, you’ll have a more profitable law firm if you’re realistic about the comparative value that your Prospective New Clients place on obtaining the highest-quality-service vs. anything (everything) else they’d rather spend their money on. In addition to making more money, you’ll also satisfy more clients when you take care to position your Price:Value Strategy within reach of the realistic budgetary demands of your Target Market.
    CHEAP ISN’T THE SAME THING AS DECEPTIVE
    With all respect to Mr. Zuganelis, the anecdote he offered about the “cheap” DUI lawyer who takes $250 and then flushes his clients’ Sixth Amendment rights down the toilet, really distorts the analysis. That’s an example of fraud, not a sensible pricing strategy. When a consumer buys a less expensive product or service, s/he still has a right to receive the benefit of the bargain. Chevys are less expensive than Cadillacs because of the Cadillac’s extra features; But the Chevy is still supposed to deliver on its promise: Affordable, safe & reliable transportation from A to B.
    I often analogize law firms to restaurants, instead of to cars: Some are like gourmet bistros which offer a limited number of customers a very intimate dining experience, for a price. At the opposite end of the scale are the fast-food restaurants which offer quick cheap food on plastic tables with paper napkins. In my experience, there’s nothing inherently better or worse about a gourmet vs. a fast-food law firm, so long as the Client knows what s/he’s getting ahead of time. The problem I find is when lawyers deceive themselves about what kind of operation they’re running and try to offer gourmet service at fast food prices. I’ve seen far too many disciplinary cases and low-profit law firms result from this kind of mismatch between lawyer & Client expectations.
    A BETTER WAY TO PRICE YOUR SERVICES
    FIRST, establish your Financial Goals (how much money you realistically want to earn); SECOND, establish your Social Goals (how much of your life you’re prepared to devote to the law firm.); and THIRD establish your Professional Goals (what kind of work you want to do every day Gourmet, Middle-of-the-Road Diner, or Fast Food Restaurant.) Then crunch the numbers and price and market your services accordingly.

  • http://www.HowToMakeItRain.com RJON ROBINS

    HOW TO PRICE YOUR LEGAL SERVICES TO MAKE MORE MONEY AND MORE HAPPY CLIENTS.
    This discussion thread reminds me of a topic I’ve experimented, spoken and written quite a bit about over the years, first as a solo practitioner and later as a Practice Management Advisor. In my experience practicing law and working with literally thousands of Solos to improve the professionalism and profitability of their law firm businesses, the single biggest impediment to properly pricing a Solo’s legal services is the mistaken belief that a law firm should provide “…only the highest quality legal services.”
    DO ALL YOUR CLIENTS DRIVE A ROLLS ROYCE?
    Our Clients are consumers, and like every other consumer our Clients make choices which they believe to be rational, about how to allocate their limited resources. The fact of the matter is that every day consumers make the choice NOT to buy the highest-quality legal services available, when doing so means foregoing the ability to purchase other products and services with their finite disposable income.
    Think about it for a second, we can all probably agree that a Cadillac is a higher-quality car than a Chevy. So why don’t all your clients drive a Cadillac, or Mercedes, or a Rolls Royce? Sure, for some of them it’s a matter of taste or unique features, but I know the reason I choose not to drive a Rolls Royce is because I’d rather have a nice Chevrolet and spend the difference on my boat instead.
    HOW TO MAKE MORE MONEY
    Actually, I drive a nice Ford but the point from above remains: When deciding how to position your small law firm in the market, you’ll have a more profitable law firm if you’re realistic about the comparative value that your Prospective New Clients place on obtaining the highest-quality-service vs. anything (everything) else they’d rather spend their money on. In addition to making more money, you’ll also satisfy more clients when you take care to position your Price:Value Strategy within reach of the realistic budgetary demands of your Target Market.
    CHEAP ISN’T THE SAME THING AS DECEPTIVE
    With all respect to Mr. Zuganelis, the anecdote he offered about the “cheap” DUI lawyer who takes $250 and then flushes his clients’ Sixth Amendment rights down the toilet, really distorts the analysis. That’s an example of fraud, not a sensible pricing strategy. When a consumer buys a less expensive product or service, s/he still has a right to receive the benefit of the bargain. Chevys are less expensive than Cadillacs because of the Cadillac’s extra features; But the Chevy is still supposed to deliver on its promise: Affordable, safe & reliable transportation from A to B.
    I often analogize law firms to restaurants, instead of to cars: Some are like gourmet bistros which offer a limited number of customers a very intimate dining experience, for a price. At the opposite end of the scale are the fast-food restaurants which offer quick cheap food on plastic tables with paper napkins. In my experience, there’s nothing inherently better or worse about a gourmet vs. a fast-food law firm, so long as the Client knows what s/he’s getting ahead of time. The problem I find is when lawyers deceive themselves about what kind of operation they’re running and try to offer gourmet service at fast food prices. I’ve seen far too many disciplinary cases and low-profit law firms result from this kind of mismatch between lawyer & Client expectations.
    A BETTER WAY TO PRICE YOUR SERVICES
    FIRST, establish your Financial Goals (how much money you realistically want to earn); SECOND, establish your Social Goals (how much of your life you’re prepared to devote to the law firm.); and THIRD establish your Professional Goals (what kind of work you want to do every day Gourmet, Middle-of-the-Road Diner, or Fast Food Restaurant.) Then crunch the numbers and price and market your services accordingly.

  • Paul M

    As I see it, the focus here must be on the quality of service provided without regard to the fee billed. I believe an attorney is obligated to provide the highest possible level of service in every case. How can we square with any acceptable ethic for the legal profession, the proposition of doing just enough to “get by” for the client who cannot pay one’s customary fee? This is a prescription for disaster.
    A solo practitioner must take stock of his or her experience, standing in the legal community, ability and need for income. If the calculus proves up a requirement for an hourly fee of $150, fine. If $250 per hour is the fee required in order to keep the doors open and maintain his/her standard of living, the lawyer will have to decide whether the fee is realistic, given his or her experience and ability. If not, employment should be sought rather than pressing on with a solo practice.
    In the end it doesn’t matter what hourly fee is set – the lawyer must resolve to treat every job as if it were the most important in the world. When prospective clients annouce that they cannot pay a given fee (and this must be ascertained at the initial meeting) a good lawyer will point them in the direction of another who might help – the local bar referral system, legal aid society, or perhaps a good young lawyer whose fees are relatively low.
    Best to all!

  • Paul M

    As I see it, the focus here must be on the quality of service provided without regard to the fee billed. I believe an attorney is obligated to provide the highest possible level of service in every case. How can we square with any acceptable ethic for the legal profession, the proposition of doing just enough to “get by” for the client who cannot pay one’s customary fee? This is a prescription for disaster.
    A solo practitioner must take stock of his or her experience, standing in the legal community, ability and need for income. If the calculus proves up a requirement for an hourly fee of $150, fine. If $250 per hour is the fee required in order to keep the doors open and maintain his/her standard of living, the lawyer will have to decide whether the fee is realistic, given his or her experience and ability. If not, employment should be sought rather than pressing on with a solo practice.
    In the end it doesn’t matter what hourly fee is set – the lawyer must resolve to treat every job as if it were the most important in the world. When prospective clients annouce that they cannot pay a given fee (and this must be ascertained at the initial meeting) a good lawyer will point them in the direction of another who might help – the local bar referral system, legal aid society, or perhaps a good young lawyer whose fees are relatively low.
    Best to all!

  • http://rollsroyceautos.blogspot.com/ Brendan

    Hey do you want a Rolls Royce?
    -Brendan

  • http://rollsroyceautos.blogspot.com/ Brendan

    Hey do you want a Rolls Royce?
    -Brendan

Previous post:

Next post: