Professional services
Law Practice Collection Rate Calculator
Collection performance for a small practice, and what changing the billing cycle would recover.
Result
Business arithmetic for running a practice, not legal advice. Fee agreements, contingency limits, trust accounting and advertising are all governed by the rules of professional conduct where you practise, and several are strict. Check the applicable rules before any of this affects a client agreement or a marketing decision. Billing delay is usually the larger and more fixable half of the cycle. An invoice sent five weeks after the work competes with a client's fresher obligations and a fading memory of the value. Trust accounting rules govern how retainers are held and applied and are strictly enforced.
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About this calculator
Which half of the cycle should I attack?
The billing delay, because it is entirely within your control and costs nothing to fix. Monthly billing on a fixed date beats billing when you get round to it.
Do retainers really improve collection?
Substantially, where the matter type and rules permit them, because the money is already held before the work is done. The trust accounting obligations that come with them are not optional.
The formula
collection rate = collected / billed; cycle = days to invoice + days to payment
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