As a follow-on to Monday, the more I think about a law firm instituting a minimum annual spend threshold, the more I think there’s a lot to this.
It’s easy (and fun!) to put this in the “there they go again” category regarding large law firm policies. To be fair, though, solid business reasons and practical realities are behind this.
Carolyn Elefant offered some good points and one in particular resonated with me, whether law firms will offer some incentives to spend $200,000 annually. Carolyn posits $300,000 of value for $200,000 as one idea. (What some GCs may be thinking about this is whether they are getting $100,000 of value instead!)
But the concept of offering incentives for clients to use firm services is worth exploring. What about a firm that does $1 million plus for a client not charging for telephone consultations with a defined number of client in-house counsel? Or provide access to part of a firm’s form files or knowledge management repository? How about a 3+ year associate on-site, gratis, for clients spending more than $5 million?
As I mentioned last time, while a minimum of a $200,000 annual spend sounds bracing, the truth for most of America’s Legal Top 40 is that it’s probably too low going forward.
And you can bet that one thing is joined at the hip with client minimums: partner origination and collection minimums. Many “partners” simply won’t make the cut. The challenge for law firms is that some of the best lawyers at serving clients aren’t the best at finding them. Minding follows grinding out the door.
Friday, a few points to ponder for smaller firms or the large-firm spinouts. The new client minimum normal may not be as good as you think.
In the meantime, we are on the lookout for the first frequent flyer-like program that is adopted by a major law firm.
Putting something like this on a law firm homepage is possible a starting point (note the fine print).