In-House Counsel

Budgets proposed with rounded-off amounts might be less effective in a competition

By Rees Morrison

A small item in Atlantic, Vol. 301 Jan./Feb. 2008, at 26, suggests a technique that both law departments and law firms should be aware of. When houses are priced in specific dollar amounts, rather than in prices that end with one or more zeros, buyers will pay more. To wit, a house on the market for $459,050 will sell for more than if it were listed at $450,000. People think that a round number is a manufactured number, but precise numbers are grounded and honest.

If this phenomenon holds for law firms, a proposal to handle legal services for $451,362 stands a better chance of being selected than a competitor?s proposal for $450,000. The calculating heart has reasons the mind cannot know.

Full post as published by Law Department Management on January 25, 2008 (boomark / email).