In Naples, Fla. last week, the 21st Annual Marketing Partner Forum kicked off with a pre-conference pricing workshop: The New World of Fee Arrangements.

The Workshop began with an introduction from moderator John Westcott, Jr., retired Assistant Managing Partner of WilmerHale and author of Fundamentals of Law Firm Management (2013). Here are a few observations about the new world:

  • Alternative Fee Arrangements (AFAs) have gown increasingly prevalent over the past decade.
  • This shift was accelerated by the economic downturn of 2008-09 and the decline in the demand for legal services.
  • Most importantly, clients are requesting/requiring AFAs.
  • Firms must engage in a dialogue with clients about legal fees, as well as expectations for the likely fees.
  • Clients’ satisfaction with the fairness of the fees is at the heart of a strong client relationship. Clients must be convinced that the value of legal services is worth the fee that is billed.

During the Workshop, I introduced the Continuum of Fee Arrangements™. Inspired by the ingenuity of Stuart Dodds, CPP (author of Smarter Pricing, Smarter Profit (2014)) and with input from my co-panelists–Peter Lane Secor and Nicole Beck–The Continuum™ identifies 16 fee arrangements, plots each along a relational line based on cost v. value, and organizes them into four pricing types: time-based, budget-based, performance-based, value-based.


The Continuum™ is a pricing resource that is simple in its presentation and comprehensive in its content. The Continuum™ starts at the left with cost-plus pricing structures that require only one-way communication, and it progresses to the right with more value-based pricing structures that require on-going, two-way dialogue. To learn more, follow the link: Continuum of Fee Arrangements™.

A Case Study exercise was included in the workshop. A software company issued a RFP for it corporate, IP and litigation work. What fee arrangement(s) would you offer the CEO? Of the more than 12 groups in the workshops, few agreed on the same approach: Hourly, Retainer, Phase, Success, Contingency were the most popular options. Just like real life, the RFP responses covered the spectrum…er, continuum…of possible fee arrangements.

The workshop concluded with a brief nod to collaboration. Attorneys, Accounting and Marketing must work together to have success in pricing:

  • Attorneys: they are on the front lines, selling the firm’s value propositions and pricing strategy and winning new business (which includes pitching various fee arrangements);
  • Accounting: they are behind the scenes, capturing big data, tracking work product efficiency and analyzing profitability;
  • Marketing: they are in the middle, writing value propositions and coaching attorneys in business developments techniques, as well as working with accounting to understand finiancial models and to test pricing strategies.

A big thank you to the nearly 60 attendees who joined us for The New World of Fee Arrangements.