Price-Sensitive

One of our clients recently received a bill from an attorney. We were talking about cash flow, and he casually mentioned that he had gotten what he felt was an "outrageous" bill from his corporate attorney. I probed a little deeper, and found out that basically this attorney's invoice had a single line in it, called "legal services", an hourly rate and the total amount being billed. I remarked, "No wonder it seems outrageous to you - you have no idea what it was for."

We're very careful in our invoices to spell out specifically what we were doing with our client's time. In the world of professional services, most of what we provide on a daily basis is intangible. Your clients aren't receiving a box full of goods at the end of the day - they are receiving your brain, years of your experience, and good advice instead. Although it's hard to put a price on that advice, we all have our hourly rates.

Many businesses in my own industry, as well as the industries we serve, sometimes forget how mystifying what it is we do for a living is to our clients. They truly don't get why writing a brief might take 2 hours or 10. It's our job to explain as clearly and concisely as possible why we price the way we do, and what they got for the price. Simply stating "legal services" will save you time in your invoicing cycle, but boy, are you going to get creamed from angry clients calling to find out what's up with their bill. "Strategic marketing planning" always gets a rise from our clients, but "Spent 2.5 hours researching market opportunity in Fairfax" doesn't.

The follow up to the story is that once the client called his attorney, and got the full description of what we on, he was actually HAPPY he was only charged what was on the invoice. Turns out the attorney had cut him a break and charged him half-time for this particular service. If he'd only taken the time to put that on the invoice in the first place . . .