How to Avoid “Client Amnesia”

How to Avoid “Client Amnesia”

A common problem in the legal profession is having clients who develop amnesia when it comes to remembering what a bill was for, or paying an invoice on time. Avoiding client amnesia is very important because the older an invoice becomes, the more likely it is that discounting will be necessary to collect it. The odds of collecting the full amount of an invoice drops off dramatically after 90 days. It is essential to avoid giving your clients reasons to not pay an invoice, if you want to protect your cash flow and bottom line.

Attorneys often exacerbate the problem by providing opportunities for clients to develop amnesia. To head off client amnesia you should avoid the following pitfalls:

BILLS WHICH ARE VAGUE AND DIFFICULT TO UNDERSTAND

Descriptions which are vague do not help a client to remember the nature of the services you rendered, and may delay the payment of an invoice. Instead of saying – conference call with client; say – conference call to discuss strategy for XYZ litigation.

Lumping hours together for multiple services may raise questions and delay payment. Rather than saying – client call, conference call and memo: 8 hours; break down the hours by individual service rendered.

Proofread your bill before you send it. Poorly written descriptions and typos may raise questions and result in payment delays. Typos may also cause your client to question the quality of your services.

LATE BILLING

Billing a client more than 30 days after services were rendered is never a good practice. You will probably have a hard time remembering what you did for the client. You have to expect that the client will have difficulty recalling the work you did. You need develop the discipline to record your time daily and issue invoices on a timely basis.

Proactive steps which can help you avoid client amnesia include good collection practices and using automated accounts receivable software.

GOOD COLLECTION PRACTICES

Routinely following up on accounts as they become past due is a key step in overcoming client amnesia. Clients will be more likely to remember the services you performed and pay the invoice on a timely basis. Good collection practices save time and increase your cash flow and bottom line.

AUTOMATED ACCOUNTS RECEIVABLE SOFTWARE

An essential tool to have in the struggle to combat client amnesia is automated accounts receivable software. Software with functionality including auto-email, invoice presentment, communication notes and online bill pay will save you time and increase the success of your efforts.

AUTO-EMAILS

Important emails and reminder notices can be sent automatically saving time and avoiding the hassle of remembering to send them.

INVOICE PRESENTMENT

Invoice templates can be set up with your own logo and personalization so you don’t have to create a new customer invoice each time you bill.

COMMUNICATION NOTES

Past communication notes and account information can be displayed in one place, making collection calls less complicated and time consuming.

ONLINE BILL PAY

The hassle of cutting and mailing a check is another opportunity to bring on client amnesia. With online bill pay your client can simply click on a link to initiate payment.

Automated accounts receivable software including these important features is available from Anytime Collect, a leader in the field with extensive experience in assisting law firms with billing and invoicing. Read more about this topic at https://legaltalknetwork.com

UNDERSTANDING THE PSYCHOLOGY BEHIND ACCOUNTS RECEIVABLE

Predict when your customers will or won’t pay.
Learn the basics of A/R psychology here.

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