What are the six key elements of an effective collection policy?
The three fundamentals of the law firm business model are: marketing (secure and maintain clients), production (do legal work efficiently and effectively), and collection (get clients to pay). All affect the bottom line, but of the three, collections—and particularly low collection realization rates—remain the biggest financial problem for most lawyers. A low realization rate means that, even as the firm pays expenses at 100 cents on the dollar, it is earning less. This lost cash flow may lead to disaster if it continues.