How Well Do Lawyers Practice? Data from the Legal Trends Report

Is that efficient?

Hell no.

“In Search of the Missing 6 Hours”

So, by now you might be wondering, what the heck is going on?

How can people be practicing law so inefficiently?

And, where is this unbillable time being spent?

Most of this time is spent on two activities: administrative tasks, and business development.

First, let’s spend some time talking about administrative work.

For all unbillable time, 48% is spent on administrative tasks.

This includes everything from “office administration” to generating and sending bills to configuring technology and collections.

What could be done to reduce that burden?

If the firm only earns money when its lawyers are billing, then the lawyers shouldn’t be the one dealing with administrative tasks.

So, could we offload more administrative work to support staff?

Related: Clio Review – Taking Clio for a Test Drive

I know that a full-time admin costs a lot of money, especially for a solo.

But what about using contractors or other third-parties?

Here are a few examples to keep in mind for reducing the administrative burdens in a law firm:

Don’t Answer Your Phones – Use an Answering Service

Stop answering your phone when people call.

You have consultations and scheduled to speak with clients.

Calls at any other time, when you should be performing billable work on client matters, cuts into your productivity.

The Clio Trends Report mentions this:

So, use a third-party service to answer your phone and schedule calls and consultations for time that you specifically block off to handle that.

Stop the task-switching that cuts into your productive workday.

To do this, consider using a service like Ruby Receptionists.

Let them handle your office’s incoming calls, do intakes, and schedule appointments with you on your schedule.

You might think you’re saving money by not using a third-party, but really you’re using your time extremely inefficiently, likely costing yourself and your firm more.

Outsource Bookkeeping and Accounting

According to the Trends Report, 15% of unbillable time is spent on generating and sending invoices, and 6% is spent on collections.

That’s 75 minutes every day spent on invoicing and collections.

If that time could be otherwise spent on client matters, that could be hundreds of dollars more earned per day – more than enough to cover the cost of the invoicing and billing support.

So, what can you do to outsource your billing, collections, and accounting?

Aside from a part-time administrator to handle these tasks, one option is a service like Kahuna Accounting.

At Kahuna, they do all the bookkeeping for you. Simply connect them to your accounting software, and their team of bookkeepers takes over.

How People Are Finding and Hiring Their Lawyers

Where are consumers of legal services going to find lawyers?

If you’re like most lawyers practicing in the country, the answer should be “referrals and word of mouth”.

Sure.

Clio’s Legal Trends Report says as much.

62% of consumers of legal services surveyed sought a referral from friends or family.

And 31% of legal consumers got a referral from a lawyer.

But, that’s not all.

37% check online search engines for lawyers.

And, 28% look at online lawyer directory listings.

Now, I recognize this data overlaps.

So what this likely means is that when someone gets a referral for your law firm, they are looking you up online to do their due diligence.

Does this lawyer actually practice and have experience in the practice area I need?

Does the lawyer have any “red flags” about them in Google?

So, what can this data suggest for your practice?

Own Your Online Presence

Today, having a website and web presence go hand-in-hand with getting business via referrals and word-of-mouth.

People who get your business card will look you up online.

It’s the least of a “check” they can do before hiring someone who is going to help them at what for them is a pivotal moment in their lives.

And most likely, they are looking you up on a mobile phone.

Because when people have an urgent need for a lawyer and get that referral, they are likely not at a desktop computer.

So, is your website mobile responsive?

Does it say that you practice specifically in the area.

Related: To Build a Law Firm Site Yourself Or Hire an Agency?

And I’m not just talking “Here is my ‘practice areas’ page that lists in bullet points that I handle bankruptcy, personal injury, and criminal defense.”

I mean, does your website demonstrate your skill and expertise, specifically in the practice areas for which you will be referred?

Do you even have a website?

Beyond that, when someone searches for you by name, will they see negative reviews in Google, Avvo, or Yelp?

Will they see positive reviews, for that matter?

Online reviews help validate you to people who are going to hire you.

Related: Online reviews for lawyers

A referral is great and all, but if 5 online reviews say “This lawyer didn’t answer my phone calls,” the client probably won’t hire you.

What Do Clients Look For?

This next chart really hurt.

Mainly because the solution is something so simple, yet it had to be called out because so many lawyers weren’t doing it.

The clients surveyed said that the most important factor for them in hiring a lawyer was that the lawyer responds to the first call / email right away.

Lawyers are routinely losing out on potential cases because they aren’t getting back to potential clients immediately.

In an interview with Legal Talk Network, Clio’s VP of Business Development, George Psiharis, mentioned that a big takeaway for Clio, after surveying law firms and their clients, was that law firms were doing a poor job of responding to new client inquiries.

Law firms spend a lot of time on business development (on average 2 hours in an 8-hour day), but aren’t responding to the business they could be getting.

That’s heartbreaking to hear, especially as someone in marketing.

For all the time and expense that goes into generating more potential clients, some firms are squandering it. If they’re not going to be quick to respond to inquiries, they’d probably be better off taking a vacation.

And I can relate to this.

I have heard from some firms saying to the effect of, “If they were a good potential client, they’d call me back.”

They won’t call you back.

Because every other service they work with is responsive

What the heck?

Now, there are a lot of other things interesting to share in the Legal Trends Report. Here are some other highlights.

How Much is a Case Worth?

How much are cases worth, on average, in different practice areas?

Clio’s Legal Trends Report break down practice area averages for different cases.

For example, will and estate cases on average are worth $1,461 to a firm.

Injury cases are worth $3,334.

Family law are $3,165.

Hourly Rates by Practice Areas and Geographic Area

How much are lawyers billing by practice area?

Immigration lawyers surveyed charge, on average, $340 per hour.

Real estate lawyers charge $302.

And med mal lawyers charge, effectively, $149.

This differs by geographic area. And Clio has data on it.

Nevada and New York charge some of the highest hourly rates, West Virginia and Maine charge the lowest.

Who Doesn’t Get Paid?

14% of lawyers’ bills go uncollected.

Which practice areas are the most likely to go unpaid?

Maybe unsurprisingly, insurance and bankruptcy are the winners.

28% of what is billed to insurance clients, and 26% of what is billed to bankruptcy clients goes unearned.

Meanwhile, over 90% of what is billed to government and workers comp clients gets collected.

What Else You Got?

There’s a lot of great info to get from the Clio Legal Trends Report.

Have a look for yourself.

If you find anything particularly interesting that you would have or wouldn’t have expected, please share what you’ve found in the comments below.