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The sun rises in the east and sets in the west. And law firms raise their rates.

Clients expect rate increases. But how your client responds is highly dependent on the nature of your relationship and where you stand within their hierarchy of law firms. Raising rates, and the discussions around them, can test the best of relationships.

The most client-savvy partners do 6 things:

Reframe the conversation toward your client instead of rates

Alter the conversation. This is an ideal time to direct the conversation toward value and your commitment to help:

  • Review and update major matters to ensure they have the best staffing and teams for where the matters are currently.

  • Make specific suggestions to streamline the work process.

  • Ask if they want a change in staffing strategy. Do they want more partner-heavy or associate-heavy teams? And, explain the impact of each.

  • Confirm current goals and objectives and how they might have changed.

  • Offer a new, comprehensive update for major matters, along with a budget status.

  • Provide an estimate to complete. (An estimate to complete assesses resources and time needed to meet objectives based on all known information to date.)

  • Suggest a relevant CLE you can deliver designed to their specific needs.

Tell clients as early as possible—way before January

Your clients submit the first draft of next year’s budget in June. They revise it in September. Announcing your rate increases after these dates makes you late. It shows you don’t understand the client’s budgeting cycle and makes them more resistant—especially because they may have to adjust their own plans.

Do it in person with major clients

You are changing the value proposition. Rates run through the veins of the relationship. You have a relationship—not a transaction. Clients expect interaction, dialogue, and personal attention. You are least likely to get resistance when you have the in-person discussion. Clients will give it more thought and consideration.

Maintain meaningful, active dialogue all year

Talk to your clients all the time. About matters, their issues, results of matters, and value. This dialogue gives you a natural springboard to discuss almost any aspect of the relationship. Your client is more likely to understand and accept the rate increase because you have a strong relationship—not a series of transactions.

Telephone can work but brings risk of negotiation

Informing clients of your rate increases by telephone brings the greatest risk of entering a negotiation. People are more candid on the telephone and more likely to be direct. They may start telling you why it doesn’t apply, they don’t have the budget, or it’s just too much. Whatever the reason, you are now negotiating. Know your limits before calling; understand what you can offer to help soften the blow—a series of CLEs or training for their staff. Or, ask your COO/Executive Director for help or to negotiate—they are dispassionate, yet want to make a client happy.

Don’t blame anything or anyone

Don’t blame increasing costs (especially salaries), inflation, the economy, or other external factors. Especially avoid telling clients the firm has to increase profits per partner to attract the best lateral partners (yes, partners really do this). Clients see these as your internal issues, not theirs.

In addition, blaming suggests a lack of conviction about the rate increase. This serves to undermine any perceived value and shows less investment in the client. It may also invite a negotiation.

We recommend firms train their partners using role-playing and mock discussions to prepare for their larger clients.

Your approach to raising rates says as much about your client relationships as any other substantive client communication. The more connected the communication—the better the relationship—the better the discussion.