Like VAT – It’s The One At The End That Always Foots The Bill

This post was originally published on this site


One of the things I always liked (well, the only thing, really) about VAT (sorry, as well as growing our practice fast, my other job was doing the complex VAT stuff) is that it is always clear who pays the VAT…it is the poor sucker at the end of the line…the consumer.


Now that isn’t true of a lot of expenses. Take for example, a conversation I had a while back with the marketing people from a mid-tier firm. They had gone to tender for a new website (it could have been anything, the principles are general). Three firms had tendered. They’d chosen one.


I am not going to get caught up in how convoluted and longwinded this process clearly was, except to say that their internal decision-making costs clearly dwarfed the hard spend (I’d reckon the two together easily ran over £50k…and I won’t even get started about the likelihood that that investment can ever pay…).

 So I asked one of them ‘Who paid the costs of the pitch prep etc of the losing firms that tendered?’

‘The tendering firm did’, they replied. But they were wrong. The problem with tendering is that it is a very expensive process on both sides, even avoiding the unending navel-gazing that results from trying to compare apples and pears, as one always does.


Firms doing tenders build the cost into the price they charge you. Of course, all selling costs are paid by the customer in the end. The stands at exhibitions, telesales teams, you name it, you pay for it. Or more strictly, unless you are prepared to take all these shenanigans as a hit on your profits, your clients do.


Unless, of course, you do things differently!


I am not suggesting that what we do is right for everyone, but just to give you an idea or two.


We get virtually all of our business through:

  •  Referrals from web-builders, specialist marketers and industry groups. Our cost here is zero (almost) unless we actually acquire the client.
  • The Law Management and Marketing e-newsletter. This actually makes a profit because it is sponsored.
  • LinkedIn. I spend about 90 minutes a week on LI. The ROI over the value of my time per hour is excellent.
  • Our websites – the new website has done well, chiefly because the savings calculator has opened a lot of eyes.


We do not have stands at conferences, telesales people, or do SEO, or have client account managers and what have you.


Our ‘hard cost’ of marketing (which includes the bit of advertising we do for name awareness) is less than £50 per week and the last time I looked, our TOTAL acquisition cost f new business was less than 4% of gross income.


Similarly, when we rebuilt the, we decided what we wanted in some detail, went to a good web builder and had the whole thing done within 4 weeks (beginning to end) for (are you sitting down?) a hard cost of £1,700 and less than 20 hrs of in house time. It paid for itself in the first 8 weeks.


The benefits of running such a lean business flows through to our clients…because all the savings we make we pass on.


Now, if that seems a bit salesy, it isn’t meant to be: what I am trying to get across is that at least some of your competitors will be heading down the ‘lean’ route…and in the longer run, all other things being equal, they’ll either have higher profits or be able to sell their services for lower prices than firms that don’t.



 To reduce your firm’s marketing costs, save staff time and grow your business faster, get in touch. 01392 423607 or see our websites at, (for law firms needing content) or (for anyone needing a brilliant, very fast, very simple, multi-modal communications/content management solution).


PS We just like this cat!