I received an e-mail recently from a company offering a free "analysis" of my firm's "cost per case" during the conference of the National Organization of Social Security Claimants Representatives (NOSSCR) this week.
The company didn't explain exactly what they meant by "cost per case." I think they were talking about the cost of advertising for cases and screening prospective new clients. The company said that the "industry average" of "cost per case" is $500-$800. They claim to be able to do it for $275-$395 per case.
I have no idea how they could possibly compute an "industry average" since law firms aren't sharing this sort of information. Indeed, I don't think that law firms are computing this sort of thing nor could they do so on any reliable basis. If a prospective client calls my firm, we ask who referred them, but we can't rely upon their statement of how they got our name. They may say it was a former client and then not be able to give the referrer's name because they are embarrassed to be relying upon a television ad rather than a personal referral. They may say it was a television ad but they may have first heard of my firm from a former client and merely been reminded about my firm by the television ad. Much of the time, a prospective client will have heard of my firm in more than one way. It's the same for other law firms.
Still, that company's "cost per case" number may not be that far off from what's normal these days. Those not practicing in this field may not understand the heavy expenses associated with representing Social Security claimants. Despite what you may think if you're not involved in this field, representing Social Security claimants is a low profit margin business. Advertising is just one element of those expenses. Unfortunately, it's one element that we can't skimp on and stay in business.