Should I discount my fees in order to bring new clients in the door?

In general, I don’t recommend discounting your fees. Once you provide a discount, clients and possibly potential clients will know that you can and will do the work for the lower fee, and in their mind, the discounted fee becomes your actual fee. They will expect the same discounted fee for any work you do in the future, and will likely pass that fee information on to potential referrals. Even worse, many lawyers realize, too late, that when they discount a fee for a client, that client often brings nothing but headaches and trouble.

Whether we like it or not, most times we equate higher price with higher value. We think if something is more expensive, it must be ‘better.’ Since that’s the way most people think, discounting your fees or charging too little de-values the service you provide in the eyes of your clients and potential clients. Often, if the fee is too low, people will wonder what’s missing or whether you’re experienced or knowledgeable enough to handle their case.

Rather than giving a discount, think about giving a ‘bonus’ – throw in a free ‘something’ – free risk assessment, free additional consultation, free review of something, free update, etc. Make it something that has value for the client but isn’t really cutting into your fees. Articulate the value of the services that you’re providing for your client within that fee.

For example, if you want to do work for small businesses and become their ‘go to’ lawyer, you could provide a risk assessment as a ‘freebie’ as part of your incorporation/startup package (although you must still make sure that the fees you’re charging are making you a comfortable margin for your services). This kind of bonus has the added benefit of educating the client and possibly showing them the value of preventative legal representation.

Whenever you give something away for free, make sure you indicate the value of the service you’re ‘giving away.’ In other words, if you’d do a risk assessment on its own for $1000, your materials should clearly state that the package includes a “risk assessment worth $1000” or similar language.

Although I don’t generally condone discounting, there are certain times when you can discount your fees for certain clients, at specific times, or for defined purposes. But those discounts should be part of your overall pricing strategy. They should only be provided on an individual basis, after special consideration.

For example, you might want to take on a particular case for a reduced fee if it will be a significant case that will help build your reputation or credibility, or provide experience you would be unable to obtain under other circumstances. You might consider discounting your fee for a particular charity, cause or individual in need. Whenever you discount your fee, you should be careful to articulate the circumstances under which the discount is being provided – i.e. for a specified period of time, for only one engagement, etc.

Many lawyers give discounts to clients on a regular basis without even realizing it, and without keeping control over those discounts. Are your clients paying your bills in full and on time? If not, you’re not getting the rate you think you’re getting – you’re actually discounting your fees. The client that always pays late and requires constant reminders before they’ll pay is costing you money – both in the real sense of having to wait for your fees, and in the time, effort and aggravation involved in chasing down payments.

If you determine that a particular case is worth taking for a reduced fee, or even no fee, that’s your prerogative. But make sure that you can articulate a sound business reason for giving the discount, and make sure that you’re making the decision – don’t let your clients make it for you.