My fellow value pricer, Christopher Marston of Exemplar Partners, previously made this post where he addressed a question from a commenter on his blog.  The commenter acknowledged the appeal of the value billing model (I prefer the term Value Pricing because you set your price, and you get paid the price -there is not billing - no collections, but I digress), but expressed a concern that when a potential client was quoted your fee (let’s say $15,000 for a contested divorce) and they were quoted a competitor’s fee of $3,500 retainer billed at $200 per hour for that same divorce, that the prospective client would naturally choose the competitor.   Christopher’s answer is necessary reading for anyone considering the value pricing model (and, in my view, that should be every lawyer!).

The only thing I would add to his post are the following two points that I think are necessary parts of the process of educating the prospect about the benefits of value pricing:

1. Explain all of this to the prospect.  Most of them will understand (once you spell it out for them) that Lawyer B, utilizing the billable hour model, isn’t asking them to write a check for $3,500.  They are asking them to write a blank check.  You, on the other hand are asking them to pay a fixed fee that will not go up.  That certainty is appealing.
2. You need to have a value position that is more appealing than your competitor’s.  This gets to his point about you not selling a commodity.  But, I’d take it further and say you need to demonstrate to your client how you are different.  I have a system for doing just that in my initial consultations (and in my representation letters).  And, you should too.  This point could take up an entire blog post of its own.  And, it will.  But, another day.