Risoli says he's not sure if any of Chamberlain Hrdlicka's shareholders fired a client in 2012 for not paying invoices, as Cobb suggests, but he says the firm is doing less work for some clients who were "fee-challenged."
Risoli says each of the shareholders trained in collections during 2012 was receptive to the process. In most cases, Risoli says, the shareholders were simply uncomfortable having candid conversations with clients over money. Among many things, Risoli says, he advised them to communicate expectations to the clients and also collect throughout the year rather than in the final months.
At the beginning of 2012, he says, Chamberlain Hrdlicka clients paid bills on average 40 days after they were due. But, that improved to 27 days by year-end. Risoli says the firm started doing work for more Fortune 500 clients in 2012, and his experience is that they pay more regularly.
While Risoli is thrilled with the firm's collection rate for 2012, he says he would be happy to keep it at around 95 percent going forward.
TOP OF MIND
At Dallas' Winstead in 2012, the firm collected a bit more than 98 percent of the bills sent to clients, compared to about 97 percent in 2011, says Kevin Sullivan, chairman and chief executive officer. Sullivan says those rates are strong because the firm sets reasonable "regional" billing rates, so total bills may not be as high as at other firms, and the firm encourages lawyers to pay attention to billing on a daily basis.
"This is all boring, really simple stuff, but it doesn't happen by itself. It's things like getting your time in every day," he says. "What we've found is clients need to get bills reasonably soon."
Sullivan notes, however, that a lot of the firm's bills are paid at closing for instance, at a real estate closing. In those situations, it's important for lawyers to provide clients with a reasonable expectation of the bill in advance, he says.
"A lot of this gets down to very, very clear communication and making this a priority," he says. "When you send out your bill and have to fight with your client every time to get paid, it's an unpleasant day at work."
Sullivan says Winstead focuses on collections during the summer and at year end.
Glenn Callison, chairman and CEO of Munsch Hardt Kopf & Harr of Dallas, says his firm's realization rate was 91 percent in 2012 and 92.5 percent in 2011. He notes the firm received a significant premium fee in 2011 that improved realization rate, and it had a significant write-off in 2012 related to an old bankruptcy trustee practice.