The Profitability Puzzle: How to Know When Your Law Firm Is Truly Profitable

Welcome to Accountants LawPod, where accounting professionals and law firms converge, hosted by Lynda Artesani, Sarah Prevost, and Stephen Libhart.

Hello, Lynda and Sarah. How are you?

Good.

How are my 2 favorite ladies?

Oh, I love being your favorite.

Somebody has to be, and it's you.

You're not getting out of it.

I'm telling you.

We're doing, we're doing pretty well. I, yeah, it's, yeah, it's Monday.

It's Monday. Boy, I'll tell you.

And early for both of you, not for me. I've already been out. I did Pilates. I went to the physical therapy for my shoulder. I'm like, I'm on fire.

I was able to walk from the coffee pot to the table.

Well, you get up early, Steve, because sometimes I do, you text me and it's like, wow, it's only 7 and Steve's up.

So, oh, you know, I start around 4 every day. I just, I get up and Yeah, you know, you don't talk to me in the evenings, so this is how I feel in the morning. Oh, I want that cup.

I bought that for myself a couple years ago. I had 4, uh, now I have 3 due to a husband, but you had 4 of those? I had 4. Yeah, they're, they're good because of the handle. It's a small handle.

I like my heated coffee cup. I like my coffee warm.

Yeah, I do too, but I've made tea today. Oh, okay. Yeah.

Well, we should get started today. We have, we have a really fun subject. It's the, uh, we're going to talk about law firm profitability, the profitability puzzle, and how to know when your law firm, your law firm is truly profitable. And so if you're in a law firm today, you really want to listen. Oh, goodness.

Oh, Lord. It is Monday.

So I'll start it. I'll start it off. I'm just going to— I'll bring up the subject. Somebody jump in. But revenue is not the same as profit. Go.

So true.

So true.

Okay, next.

Well, you know, you can look at your net profit margin, right? So that's your money that you have. You look— in fact, that's where everybody looks, right? You send them a P&L. They don't even look really through it. They just go right to the bottom and go, oh, is that what I made this year? And I think that, you know, you look at what's left over after you've paid all the operating expenses, your staff compensation, all that kind of—

The net income. The net income is what you mean.

The net income, yep.

But you know what's not in there is the draws and all those things off the balance sheet.

Correct. Yeah.

Yeah.

Yeah, the true net. And when you think about, Lynda and I have been talking a lot about this with our team, is when you think about for every dollar earned, like the The gross profit, right? Above, before all that operating.

Right, right.

What generates that? If you're a solo firm, it's you. So to your point, Steve, but if you're not and you have, you know, a contractor that supports you or any sort of direct, for every dollar earned, there's a direct correlating dollar on the offset. Strip away this whole software stuff, that's different, right?

But People.

That gross profit is what we should be thinking about. And similar, we had this conversation in the Law Lab, was the advanced client cost.

Mm-hmm.

Because, you know, some, depending on how you track it, now mind you, we have a methodology of the way we prefer it. However, we understand everyone does it differently. If you're allocating that separately on your income lines, You should have a correlating line item below that's very clear that shows what that pertains to. So any of those advanced client costs that are recouped has a correlating cost on the ops and where that sits. A lot of times cost of sales isn't something that you see, or direct costs.

Okay.

A lot of people keep it in the lower expense line item. But we've gone, Lynda, we've done back and forth. We've done where we've rested it up in what is called cost of sales or cost of goods, typically not seen in a professional service, but we've done that to help get that gross profit before all of the stuff at the bottom. So I'm not sure how you do it.

You know, what kind of a profit do you want to see when you look at a firm's books? Like what percentage do you like to see the net profit be? As opposed to like the revenue. You want to see, I mean, and we want to see a decent amount, right? That profit, law firms service-based. So you want to see something, I think in the 20 to 40%. I personally, I agree with that, right? You want to have a good percentage. Um, and if it's below 25%, you kind of want to target what's going on and why.

Yeah.

Because it really shouldn't be. And I'm talking about like, if you've got a, If you've got a small— some small firms, they've got it dialed in. You might see higher rates, right? As opposed to maybe mid-sized firms might be a little bit less, but I mean, there's different, um, a little bit less, but you don't want it to be much below. You don't want it to be below 20% because then what are you working for? I mean, yeah, it's, it's, you want to see, and we do see it. I mean, law firms that we work with, they, they're pretty profitable, uh, fortunately. And then, you know, then we can dive into when you're looking at profitability, the puzzle of it, looking at the expenses, look at, looking at the overhead as a, as an overall number and how much is the overhead as opposed to, you know, we see all these different firms. We can see the differences between firms. Some are heavier in overhead than others because wages is the number one, right? That's the number one expense for the most part, for most firms, it's the wages.

Well, and to your point, Lynda, a rapidly growing law firm, You really need to tune in on the very thing you're talking about because it can get away from them so easily as they start layering more benefits in and things like that. And so it behooves us as we work with them to really bring these things to their attention. A year ago or 6 months ago or 3 months ago, whatever you're comparing against, this is where you were and this is where you are now, and this is what has caused the change.

Yeah. And sometimes they go through a growth spurt, right? So even with Sarah and I, we're We're kind of in this growth model thing that we're doing, and we see sometimes you have to put some resources to other things that you didn't want to up to that point because you're starting to, you have this growth spurt. So you kind of analyze it, but then another place you want to analyze it too is the profitability per partner or per attorney.

Yeah.

That's another really good metric in the profitability puzzle, right? You want to know, you want to know who your rainmaker is, you want to know how the business is doing in that respect, I think, too.

Well, and by sometimes it's by, if you're depending on your modeling of income, how you collect, if you're hourly, hybrid, all these things. So yes, there's a lot of dialogue about killing the billable hour. However, if you want to give yourself the leeway to understand, you still need to track to see how profitable you are for that. Only tracking that at this top line space, you're missing to what Steve, you're saying, is this overhead space. And I think back to the podcast we did with Danielle when she talked about kind of a sandwich of a third, a third, a third.

Oh yeah, yeah.

And how that light bulb moment came in my head of Okay, if I understand it, if I simplify it, and I love what Lynda's saying is you gotta, yeah, you gotta look at all these spectrums, but just simplify it at least, you know? And we talk about that when we get into, you know, what are the goals of marketing and like what you guys have previously talked about in post episodes of KPIs. What are the metrics? So you slowly build the foundation. I think you'll begin to understand what you're gonna build for yourself, but you have to give yourself.

Mm-hmm.

Like Lynda and I are going through, you have to give yourself a little cushion of cash when you make these transitions. You turn on the marketing bucket, but then you got to turn around and make sure you have the cash.

I mean, we've had some attorneys that we've had conversations with about the marketing bucket and, you know, they might be putting more money in the marketing budget or pivoting and trying something new. And it's good for them to have that conversation with us so that we are, we have an understanding of where they're going and kind of mapping it through for them. And I think that that's important. That we have that knowledge because we're not just people. And I just wrote 5 articles this weekend and recorded 5 videos this weekend, kind of about what we need to be doing towards the end of the year. And I think, you know, you look at, you start to really look at the metrics of where we've been, 'cause we're, I don't know when this is gonna land, but it could be at the end. It could be in September. You look at where we've come from.

Mm-hmm.

And now you've got 3 solid quarters to look at, or almost, right? You're almost there in the 3rd quarter. And then looking ahead, because a lot of people do after-the-fact bookkeeping, they don't wanna spend any money on bookkeeping, and they're like, I just want the cheapest, and they don't really look at anything. And September 24th. So this is a great conversation for that because you're looking at the end of the month of September, right? And you're looking at how you've gotten to this point. And then with the knowledge of where you're going, and then also knowing that you're trying to keep the end of the year, this is a great time of the year to really Look at the data. Look at your goals. Did you set any goals in January? If you didn't, that's okay. But if you did, how are you doing with your goals? Was there something that came up that was unexpected that changes what you had for goals? I think those are the things that you start to really cue in on. That's kind of where you're looking at your profitability. And maybe the profitability took a hit this year for whatever reason. There could have been any reason. Maybe you lost your top attorney, and maybe you lost your rainmaker at some point, and now you're looking at, how am I going to get out of this? How am I going to get through the rest of the year and plan for next year? I think those are the things you want to look at. Plus, you should be looking at your expenses. It's part of your profitability equation. And look at exactly what's been spent. Grab that computer software bucket, then divvy it up, sort it out, look at it. Look at how many users you're paying for and how many users are using the software. That's always a great metric to look at. You know, some of the things that Sarah and I are doing right now, because we're, as we grow, you know, somebody leaves, somebody comes, and then all of a sudden you're like, oh, but we never turned that off for that person, but we've added the other person. We didn't turn it off for somebody. You kind of want to have that list too.

You know, I want to, I want to back up a little bit. I'm glad you brought up marketing because especially for solo attorneys, brand new solo attorneys, Mm-hmm. I've seen, and you guys have probably seen this too, where they just pour as much money as possible into marketing and then wonder why they're not getting results. And, you know, you've got to look at the type of law you're practicing, you know, what your pain thresholds are, what, what, you know, where the rest of the money needs to go. You need to, you need to be happy in your business and pay yourself a salary. You've really got to budget that in, not just hope that you're going to get paid.

Yeah.

And, um, look at, you know, a, a personal injury firm might not use the same type of marketing as a corporate firm, you know? So, so it's, it's not that one-size-fits-all thing with marketing. And, and I've seen them pour so much money into it and then wonder where, where the business is. You know, the busy bus does not pull up to the front door and people jump off and come in. But, um, that's where Sometimes, but that might—

sometimes it's not instantaneous too. So sometimes you put the money into that marketing bucket and then a full year goes by and then all of a sudden the fire hose is on and you're like, what happened here? Well, it took that long for the marketing bucket to fill up.

It takes a while. You're right. That's a good point.

So you've invested into it, but it comes back, you know, tenfold sometimes depending if you pick the right thing. That's the other part.

And that might be where you want to bring in somebody from the outside, like a marketing, legal marketing consultant for a while. Just to say, think about this, think about that, look at this, look at that, because they work with a lot of different law firms.

And marketing's changed a lot, don't you think, Steve? In this, this era, oh my gosh, yes, we don't Google things anymore. We kind of go to Claude or, you know, ChatGPT. We're using that. Who would have thought 5 or 6 years ago that's what you were doing?

The big announcement I found interesting was that Chat and Yelp and the value of Yelp for For, I think of restaurants a lot of times when I think of Yelp.

I hate Yelp.

I'm not a fan, trust me. Um, but it's interesting because it's a game changer where Google has had the market. And so to your point, you're investing in these things, but as business owners, and that's what we are, we hear things like this. Like I haven't, I heard this, I think on Friday and I didn't share it with you yet, Lynda, but I was like, oh, that's interesting. Um, for me, if that's the type of business you are, if you need those testimonials and that's what you service in, you know, there's corporate attorneys that don't have this, right? They, they, their type of business, their practice is really focused on a bigger corporation. So that's different. If you're in the smaller space and you are word of mouth, referrals are the best way. Referrals.

A DUI attorney's a great example. Yeah.

And DUI attorneys. But I, I would say, like you're saying, Steve, where are you gonna spend those dollars and how do you think about it? Because again, for every dollar that walks in the door, what is happening as you move those funds? Or like Lynda brought this up a long time ago, is, is when you make a transition or you're going to, you know, develop a new niche or a new market, You have to really keep the money in the firm to allow yourself that runway. People don't think like that in this profession a lot of times. It's, you're just going to draw it all out at the end of the year. Understandably so. There's many reasons why, no judgment on our part, but we think in safety and what we at least want to see. We think in like, we're numbers people. So we're like, well, how many payrolls is that? How much rent do you have?

When's the insurance due?

When's the insurance due? When's the bar dues? When's the PLF due? If you add a new attorney, have you thought about what that, that take-on is? Because not just salary plus, plus, plus.

It's not just a $150,000 a year salary or whatever.

No, no, exactly.

And this is a great time of the year if you've gotten to this almost to the 3rd quarter. Look at the profitability of each one of your clients and see if you made money doing one particular type of law but over the other. And it's a good time to take and aggregate that data. And you probably, if you've got Clio or LeanLaw or something like that, you can start to look at that where sometimes, um, it's not a fun job because sometimes it's— but it's very eye-opening. I think sometimes you just kind of take that time to look at it and you're like, oh, I thought I did a lot better there, but I didn't. And then you want to investigate what happened and what went wrong. Um, it could be, it could be even like, um, trends in the marketplace. Who knows? I mean, we see things that change over time.

But if, can I ask you, Lynda? Because we heard this from a client. If you hire a marketing firm on this topic for helping you bring in those dollars, I'm thinking of ways to measure it. Like, because you're right, you need a runway. You hire them, it doesn't mean instantaneous, right?

Correct.

It doesn't, but then you got to track it too. And I think sometimes people drop the ball when it comes to tracking it. They, they throw a lot of marketing dollars into Facebook or Google. Gosh, we see so much money spent on Google every day. Some clients are $500 every day for Google Ads. And then if you're not tracking where the clients are coming from, are you just— you could take the money and just light it on fire in your backyard. It's the same thing.

Oh.

Or are you getting, are you getting the ROI on it? And I think that sometimes that piece, they hire the firm, but then somebody in the office isn't actually tracking it. Like we track it when the leads come in, we track where they're coming from. And, you know, for us, it's kind of spread across the board, whether it's local to Sarah or Sarah talked to somebody on the airplane or, Somebody saw a video of mine. They, it, there, we have a variety of touchpoints, which is great. We've kind of blanketed the market of our business, but sometimes with the practice areas, depending on the practice area, where are they, where do they get their leads? Because most attorneys will tell you, oh, I'm referral based, but are you? Or are you kind of a mix? And I think that you need to track it to find the answer to that.

Yeah.

I don't think, you know, you, you can go by your gut a little bit, but sometimes it's good to To actually know and have the hard figures in front of you.

And there's nothing wrong in asking the marketing person that you've hired to help you track it.

That's a valid point, Steve. That's a— yeah, yeah. Well, okay. So what else do you think, Steve?

Well, don't have imposter syndrome. Look at your pricing. You're worth what you're worth. And what are the impacts of— sit down with a spreadsheet. Or whatever, and put different, different tiers of pricing in. And based on your experience or where you want to go and start massaging those numbers, and you'll be amazed at what that does to your cash flow. You know, it gives you that scenario of, if I, if I just tweak my hourly rate by another $50 an hour, what will that do?

You know, sometimes you want to look at your collections too. This is a great time to sit down and look at your collections because if you have a lot of outstanding money out there that hasn't been paid. And now is a great time to kind of look in and see where you could maybe start to collect money you've already earned. You already earned it. You want to get paid for it. You want to look at your realization rate so that you have the, you know, you have an opportunity to kind of pull that money in that's just sitting there and don't write it down. Oh, my heart breaks when they say, write it off. I'll never get paid. So-and-so will never pay me. And it's like, oh, you did all that work for them. And that's the kind of part of the business, I think.

Well, you know, having worked in law firms as many as I have over the years, you have a really good point there, Lynda. And I see, I've seen so many times where they'll, for lack of better words, pad the bill up and then give the client a discount at the end. And that's, that's really a tough one to monitor, but it happens. And also, Yeah. No, go ahead. Go ahead.

I would say you can monitor, well, LeanLaw, and I don't know, I'm sure Clio does too, does a great job of tracking when you write it down or write it off. You can see that and they've got reports on that. But yeah, I mean, and you want a good billing realization rate. You want something in the, I would say upwards of like 88% to 92% of the money being collected on the money that's out there. You really want to keep that. piece that you're writing off low. Because you ever do the math with that, and we've done it where you've done the math on that and you're like, wow, this is, you know, you write off money, it's going to hurt the bottom line when you look at that that way.

It's so hard to, depending on your model, there's so many models of billing and collecting and how it all works. And I think the eye-opening thing too is we recently were kind of Looking at an AR collection review of something and some of the, I guess you could say, the scope of work that was discussed. I was looking at it, I'm like, but why? All I kept thinking is why? I felt like a little toddler. I wanted to just ask them like, why do you do it this way? Why are you looking at them this frequently? How valuable is it? Is it relevant? Does it even make sense? Um, what, what do you take from this? And so kind of this mix, I feel like, is what we're talking about, is you've got to find this mix of when it is a good interval and a good time to review these things, when you have the headspace to do it and you can actually put some, some time into it.

Right.

Um, or is it, you know, do you have it blocked on your calendar when you're getting ready for pre-bills What that looks like. We know what it looks like for one attorney that we have a longstanding relationship with, and we know to clockwork how this individual works. We know when to expect the email. It's— and it's nothing wrong with it. We just know it. And it's great because we understand that there's been some due diligence and we can actually go through and do the work without any— without a question, because we're going to help bill it, right?

Mm-hmm.

And following up and doing the feedback loop. I mean, it is a lot to go through. So you have to, sometimes I feel like you just have to see if like what you're doing as far as what your service offerings are, to your point, Steve, and does your engagement fulfill what it is that you're trying to make the model change on? Because some engagement letters actually don't fulfill that need. You've made the switch, but you didn't actually update it appropriately. Potentially.

So, well, and how about, yeah, don't confuse busy with profitable. Oh, that's so true. I've seen this in law firms and accounting firms. Um, you know, your staff productivity, if you, if you're like, oh my God, we're so busy and we're doing all this overtime and blah, blah, blah, blah, blah. Why? You know, and what, what does the bottom line tell you? And what's the difference between the two? And what can you unearth? To fix it because that's like your point of going in the backyard and burning up the money.

Yeah. And we've seen busy firms that are not profitable.

Right.

I mean, I can remember, um, I'm just thinking way in my Wayback Machine when I worked with a hair, uh, hair salon company. She had one very profitable, uh, location and she decided she was going to be the biggest in the state of Rhode Island. And she started to branch out and got a couple other ones, but she wasn't there hands-on. She became, I'm going to hire somebody to do my job here, my job here, my, and I'm just going to sit back and watch the money roll in. And nothing good came out of that. She did not make any money. I think she ended up going bankrupt at the end of the day.

Oh, that's sad.

Um, she did not, uh, she put people in place that she thought were great, but they were, they were actually robbing her and taking the inventory. It was just an awful nightmare. And it was, you know, she just grew too fast. And I think sometimes, you know, you got a law firm that's cranking and rocking and rolling. You want to make sure that they're, they're keeping a tight watch on everything. Staff efficiency. One of the things you can find out if you start to talk to the staff or have, have your bookkeeping firm or advisory CFO people talk to the staff, find out what they're doing. You might find out that there is inefficiencies there that could be cleaned up a little bit. Um, and maybe some time saved or even overlapping or redundancy in some of the workflows that you could probably maybe improve.

Mm-hmm. Mm-hmm. Yeah. Yeah. Oh man.

I saw a painful look in your face there, Sarah.

I know.

Just, it's just like a long road and it's exciting. You open your door, it's exciting. It's kind of like, I think, I feel like it's like a TV series. You like, it's exciting. The first season's amazing. The second season, you're kind of like, okay. And then you're in the middle and you're like, now what? Where is this going? Yeah. And you don't wanna be the same.

You don't wanna be tracking your, uh, you know, don't track your law firm based on what's in the bank. That's the other thing. People think their checkbook is their gauge.

Or future income on trust money. I mean, you know, a lot of things can happen. A lot of things can happen in between earning that money and actually getting to take it.

Yeah.

Yeah.

Oh, that's such a true statement, Steve, because I think sometimes they do look at the retainer balances and think, well, I've got that coming in soon.

Well, I worked with, I worked with a law firm. My mentor, he's, he passed away. He's gone and I miss him. But, um, he always called the trust funds unearned revenue.

Yeah.

That was the, the MO of that statement was, well, it's unearned. We're going to get it. Well, not necessarily.

Not necessarily. Yeah.

You could return it. Yeah.

You could return it or, you know, you could break out a lot or whatever, you know.

Yeah. Things happen to people. Things change. Yeah. So true.

So getting your arms around your break-even point, you know, you get a feel after a while, know it, and you get a feeling after a while what it should be every month. And if you're monitoring that, it's going to tell you a lot.

The comfort of, of kind of knowing, Steve, you brought this up about what you should charge or what you want to charge or value. You know, it, I was having this conversation the other day with, um, my husband and I, I instantly was like, hmm, you're charging too little. Right. And, and then we were having this bigger dialogue and there's a lot that goes behind it. There's this emotional piece. There's a whole bunch. There's also market rate, uh, share, like what you can do. And when you think about it too, is we're specialized, the 3 of us.

Mm-hmm.

So comes a little bit of like a mixed bag of how to handle that.

Mm-hmm.

Um, and some people think, oh, cuz you are niched, you can do X, Y, and Z. That isn't so true. And that's the same for the type of practice area you're in. There's only so much a market could bear. There's only so much bandwidth you can do to produce. And depending on what size firm you are and sort of what that structure is, and we, we see a lot of what I call cookie cutter models. And you could tell by the website, the way the website looks, you can tell how they're coached.

Mm-hmm.

And it, to me, it takes the authenticity out of it and it takes the fun out of being the business owner because it's so regimented. What joy is that? Yeah, you're for your profit, but then what joy is it to be an entrepreneur at that point? I don't wanna be a cookie cutter. I know Lynda doesn't want to. There is some flavor in—

Oh, you guys, you guys are so far from that. I mean, you're so innovative that—

But, but it's true of other law firms, right? We see it when we look.

Mm-hmm.

We, we are doing the same thing when a client comes to us. We look at them, we wanna make sure, is this a good fit for us? We wanna enjoy the relationship and vice versa because it's a partnership.

Mm-hmm.

And, um, and that's the same probably for the clients that are hiring people. Sometimes it's out of need.

Mm-hmm.

You know, you never know. You've been in an accident, it's going sideways, you immediately need to hire somebody and it's just your friend told you.

Mm-hmm.

Maybe it's a good fit, maybe it's not. Uh, the, the story I heard on Instagram recently was, uh, somebody moving to a different country and they needed to hire an attorney because things were going wrong. And it was a referral that wasn't a good fit. They had to go to somebody else. It was so weird. It was so random how it all worked out, but it's, it's the same story on the other side. So tracking those marketing efforts, figuring out what practice area you're in and are you actually tracking it the best you can for yourself?

Mm-hmm.

And then how to market yourself, how to, you know, as far as like, what's the value of who you are? Is it billable? Is it flat rate? It's okay to do different than somebody else. Everyone else is doing billable hour. Try your flat rate. Put a little package together and see how that works.

See how it goes. And they're usually afraid of that.

Yeah.

And we were afraid. I mean, honestly, we were afraid of even doing it longer, I think, than the attorneys have been. But, um, it's worth floating out there because sometimes you do get it right. And it's so much easier than tracking all every single minute of the day.

Yeah.

It depends on the practice area, depends on the service, but you might want to try it out with just maybe one, one thing that you service people for that you kind of can gauge and then just go from there and see how it works. It's a lot easier to manage and you might find it's very popular and very lucrative to do that.

Well, you know, if you're just starting out, um, I'm talking more on the bookkeeping accounting side. If you're just starting out with a solo attorney, I'll use that example. Yeah. It probably is best to go ahead and track your time and charge them by the hour as you build that relationship with them, that partnership with them that Sarah mentions. And then after a while, you start seeing it kind of even out. And then they start wanting more projects because they're growing and you've helped them set up their KPIs and get there.

Mm-hmm.

Then you can kind of go start talking about that flat rate environment.

Mm-hmm.

You know, because you're adding things into the package now. And you've heard, we've all talked about this before, that list that I keep of scope creep. You know, that helps out a lot in knowing where your time and money is going to run your business. And so, you can have that intelligent conversation with the client and say, okay, you've grown this much and you've added these things. And this is what you want me to do. So, this is what it's going to cost now. And I, I never see a problem with that because I've tracked it and kept, you know, kept it in the forefront.

And if you're going to be doing, you know, fixed fee billing, you still track your time just to see how you're doing.

Oh, sure, sure.

Yeah. Yeah. So there's really, I guess in the end, you're really not killing the billable hour in a way. You're just tracking it differently, you know, like, but I, it's, it's a measure metric, I guess, in some ways, if you're trying to And then you'll get efficient. And I'm sure all these new tools and all these new efficiencies are going to work into it. So that's going to game change us further. We'll probably have this revisit this whole conversation in probably 10 months from now and we'll be like, okay, throw that one out the window.

We'll see what AI is doing now.

But we do have some past episodes that really do help with this, especially from a CFO side, because that's also an interesting perspective given that they look at it from a different lens. And we love our partnerships with that. Um, we love the people that we work with that offer that because it, it's just one more piece to it. It might feel redundant, but it's actually very valuable if, especially if you're intentionally growing. And that's the difference. I feel like any of us accounting and in law firms, the intentional growth is a different mindset than the onslaught, like somehow finding a way to prepare.

Mm-hmm.

Well, one final thing before we close out, just to your comment on the tracking time, even though you're in the flat fee scenario, there's not as much pressure when you're tracking time when you're in the flat rate scenario. There's not as much pressure on, oh my gosh, I've got to capture every single second of every day to generate revenue. And you end up unclogging your mind a little bit more, if you will.

Hmm.

And give yourself the grace of, of, you know where I'm going with that.

I mean, well, and it improves your relationship with your client. They know what they're going to pay and you bill it and it makes for happy clients. So that's the other piece. Yeah.

Well, this was a great conversation, you guys. I hope, I hope people out there can really find it useful. And if you have questions, let us know.

Yeah. Yeah. Comments. There's a little comment section somewhere in this whole thing.

Somewhere over there.

Somewhere.

Yeah.

You guys have a great day.

You too.

Bye-bye.

Bye-bye.

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