Fixed price patent work – demand it

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For too long (and I mean centuries!) patent attorneys have billed by the hour, avoiding fixed price patent work at the expense of their clients.  It’s actually at the expense of their own businesses too.  There’s a great LinkedIn article by Mike O’Horo that sets the problems with hourly billing out really well.

The time has come to force a change.  But this is about more than money, it goes right to the heart of the trust in the relationship.

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If you’re a tech SME then this blog tells you why you should insist on fixed fee work and how to get it.

You’re the only ones paying by the hour

Tech SMEs, I’ll let you into a secret.  You’re about the only clients paying patent attorneys full hourly rates for your patent work. 


Larger clients have been getting fixed price work for a long time.  And they get that benefit because they have buying power – they might give a particular patent firm over £100k of business every year so they get to call a few of the shots. 

You don’t get this benefit because you do not typically have that buying power.  And because the patent services sector has stuck doggedly to billing by the hour so you haven’t had choice in the market place because very few firms are offering fixed price work to you.

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Why big firms ask for fixed price patent work, Part 1 – Budgeting

Part of the answer is obvious.  Fixing the cost of each task a patent attorney does for you:

  • Controls costs;
  • Allows them to budget more easily; and
  • Allows them to compare firms like-for-like on costs

When firms are billing by the hour then if a particular job takes a long time for whatever reason then the size of the invoice can be a lot higher than expected.  This is a nightmare when you’re trying to plan and stick to an IP budget, as many of you will already know. 

It also means that it’s impossible to understand whether you’re getting good value.  Because you’re paying for an input (hours) and not an output (a work product). 

As an example, one patent firm might offer you a lower hourly rate than another patent firm.  This sounds good and like you will save money so you agree to use that firm.  But the attorney doing the work takes a lot longer to do each task than the attorney at the other firm so you end up paying more!

Imagine how much easier these things are when you know what you’re getting and how much it’s going to cost.

This also makes it much, much easier to compare different providers on cost and make a judgement as to whether they’re expensive, cheap or somewhere in the middle.

Why big firms ask for fixed price patent work, Part 2 – Trust

The other part of the answer is perhaps less obvious but is really important.  You can trust a patent attorney working on fixed fee a lot more than if they charge by the hour.

To be clear, I’m not saying that patent attorneys charging by the hour are crooked!  It’s just that their outcomes are not aligned with yours.

If you’re billing by the hour then the longer something takes you then the more you get paid.  And you get paid anyway, even if the results aren’t that great.

Whereas if you’re charging for an outcome and getting paid is contingent on the outcome being achieved, you want to make sure the client achieves that outcome and do that as quickly and efficiently as possible.

If you agree a price for an outcome that is then achieved, you never complain about the price.

What can you do to get fixed price patent work?

The first thing is to ask for it!  Your existing firm might be happy to move over to a fixed fee arrangement.  In that case, you’ll want to make sure the fees are reasonable.  You can do this by taking some kind of average of the amount you’ve been charged for each task in the past or you can compare them to a few other patent attorneys.  If you contact us then we’ll be happy to let you see our price list so you can make that comparison.

If your provider won’t move to fixed pricing then you have 2 choices: put up with the billable hour; or move provider.

Moving provider is a lot easier than you think and you should seriously consider it.  What’s more, any cost for the new attorney getting up to speed will be borne by them because their charges are fixed.  If it takes longer then they still get the same money.

More and more firms are using fixed prices for patent work, Matter IP is just one.  So you can start to look around and find one that suits you.  If the attorney is the right one for you with a good commercial brain then moving to fixed prices will definitely pay dividends.