You can never have too many referrals, right? Not exactly. While referrals from satisfied clients and other sources are gratifying, they do not always lead to engagements you want or are qualified to accept. The key to making referrals payoff is by promoting quality over quantity.
Who Are Your Clients?
If you want clients that are right for your practice, you need to first define, in writing, who or what is your ideal “A” client.
When you talk to potential referral sources, in addition to discussing your firm, its practice specialties, size and location, describe your model client. A referral source is looking for an attorney or law firm that is a good fit for their client or contact.
Consider what personal information you want your referral sources to share about you — for example, your civic activities or your law school.
Who Are Your Referral Sources?
Not every banker, accountant, financial advisor or real estate broker is the right referral source for your firm. While it is true that you never know where your next referral is coming from, the chances of getting a qualified referral from the wrong source are slim.
Just as you did with your clients, define your ideal referral source. Usually, these are professionals who serve your target clients or have business or social affiliations with them. This group may include attorneys who work in different practice areas than yours and do not feel qualified to accept all of an existing client’s business.
Now is a good time to look at your referral contact list. If you cannot remember the last time you had a face-to-face meeting with one of these individuals, it is time to either reconnect or to strike them from your referral list. Setting up an active and inactive referral list can help. That way you can channel most of your energy into the active list.
Where to Begin?
Start by brainstorming. When developing your referral list, include lawyers who practice in an area of law similar to yours and lawyers who have opposed you in court. Your firm may be larger or have more or different resources, and therefore may be the ideal firm to handle an engagement another firm is not equipped to take on. Do not forget to add bankers, CPAs and investment advisors to your list as well.
How Good Are You?
Referrals will only come your way if your sources believe you can help solve their clients’ problems. Even though a lot of people in your network may know you are an attorney, most probably do not know the field of law in which you practice. Develop an elevator speech; talk about what you do. Cultivate your referral sources and tell them.
Consider partnering on an engagement with a referral source to demonstrate your capabilities. Here is where you need to understand the ABA Model Rules of Professional Conduct. Some highlights include:
- You cannot promise an exclusive referral partnership arrangement with anyone, whether it’s another attorney or a non-attorney referral source. Reciprocal referral relationships must be disclosed to your clients (Model Rule 7.2(b)(4)).
- You cannot promise gifts in return for referrals (Model Rule 7.2(b)).
- You can never pay a referral fee to a non-lawyer — ever (Model Rule 5.4(a)).
- You can share fees with another lawyer who isn’t in your firm, but the total fee must be reasonable, your client has to agree to the arrangement in writing, and the fee must be proportional to the work involved, or else both lawyers have to agree to be jointly responsible for the representation (Model Rule 1.5(e)).
- The contact needs to initiate the contact (Model Rule 7.3).
Finding New Sources
What should you do if your referral network is too small or you are unhappy with current referral sources? Get out there and talk to people. Use business and social events to introduce yourself to other professionals and to ask about their practices. You never know where a few questions might lead.
For questions, contact Bob Rifkin at 312.670.7444. Visit orba.com to learn more about our Law Firm Group and the variety of services we provide to our law firm clients.