Dane Panes* Starting your own law firm is a major step towards success as a passionate lawyer. However, the process of building a law firm from the ground up can be daunting – not to mention, challenging. Once you open your law firm, you won’t just be a lawyer. You will also become a business owner.
With that, expect to have a lot more on your plate. On top of preparing for cases, court dates, and defending your clients in court, you’ll also need to think of your business budget, rent, utilities, marketing, hiring, and virtually anything related to running a business.
Long story short, running a business – a law firm at that – isn’t going to be a walk in the park, and you can’t expect success to come right away. Mistakes happen, but in a high-pressure field like law, it’s always safe to assume that every misstep has consequences. If you’re not careful enough, what seemed like a simple mistake could end up costing you everything.
The good news is, mistakes can be prevented if you take proactive steps. That said, here are seven tips that may help you avoid mistakes as you run and manage your startup law firm.
1. Pick a Niche
It can be tempting to take on any client that comes into your doors as soon as you open. But focusing on too many niches at the same time can hinder you from reaching your long-term success. Working on several unfamiliar aspects of the law can be risky and could increase your chance of getting malpractice lawsuits.
On the other hand, by having a specific niche to focus on, you’ll be able to quickly establish your skills and expertise as you’ll only be focusing on one area of law.
That said, if you want to specialize in criminal law, build your expertise on that and only accept clients whose cases fall under criminal law. The more you understand a single type of law, the safer you’ll be and the faster you’ll be able to build your expertise. In turn, it will be easier to find clients.
2. Have a Clear Plan For Your Firm And Set Clear Goals
What are your goals? How will you measure your progress? How will you get clients? How will you market your firm? What staffing will you require? What will your firm culture and ethos be? Will you need funding for your equipment, supplies, and other office or building renovation costs?
Some may be able to jumpstart their business in the early days successfully, but eventually, you’ll need to have a business plan that will outline your strategies. Not only will it serve as your guide in steering your law firm in the right direction, but it will also help increase your chances of getting approved for financing in the future.
Moreover, you should also include goal-setting in your planning process. Your goals help give direction to your strategies and actions. It lets you and employees know what to focus on more for that quarter or fiscal year, which in turn, helps them find meaning behind their work.
It’s worth noting that a private law practice is just as volatile as other businesses, and can, therefore, experience the same market conditions. Without planning for the worse, you could risk losing everything you’ve worked for during an economic downturn.
The proper planning for the commencement of your law firm, but also for its ongoing growth and development are some of the brainstorming considerations that you need to consider when – or before – you start your law firm. Remember that no aspect of this planning is too minor or remote. Allow for and plan for every contingency. By doing so it will pay off in terms of your firm’s ultimate success.
3 Market Your Law Firm Properly
You can’t expect clients to come to you the moment you open your doors. If you just sit around and wait for clients to come, it won’t be long until your cash reserves run dry.
Again, just like running other businesses, you have to reach people and tell them about your business. For law firms, this means going the extra mile to earn the trust of prospective clients.
So how do you market a law firm? There are a variety of methods and practices that permit law firm marketing such as here, but among some of the most effective are the use of website optimization, content marketing and effective use of social media.
It is hardly a secret that one of the best marketing strategies today is digital marketing. Invest in a website and its optimization. With more and more people going on the internet these days, your best bet in reaching new clients is by putting yourself on top of the search engine results.
And then there’s the big, old word-of-mouth marketing. Traditional as it may seem, but word-of-mouth marketing is one of the best strategies to get new clients as a law firm. If you come highly recommended by your previous clients, chances are, it will be easier to see new faces coming into your practice.
4. Build Your Firm’s A Team
Your employees play a part in the success of your business. As such, you should only hire those you think will contribute to your law firm’s success and you need to do that sooner rather than later.
The problem with most lawyers is that they tend to go over the hiring process quickly to save time. That way, they will have more time to spend on their cases and actually running your business, not realizing that it could be one of the biggest mistakes they’ll make.
As a startup law firm, you only have a few positions to fill. That said, you should only pick the best of the bunch. So, in between cases and court appearances, invest some time picking out your employees and interviewing them thoroughly. While skills are valuable, try to look beyond their CV. Ask them about their ambitions and priorities. Ask them about their work ethics. It’s crucial to pick a candidate that will fit your law firm’s culture.
When looking to start a law firm, as with any business, you need to have the goals clearly in mind and also the fact that you want ‘A class’ performers to deliver on your necessary legal services and to fit your proposed, or actual law firm culture.
5. Use Legal Technology
It’s a new age, so take advantage of the latest advancements and legal technology continues to drive the growth, or the decline, of law firms as we have reported.
Gone are the days when you need to manually calculate all your expenses, taxes, and employee payroll. Not only is it time-consuming, but it also leads to more mistakes. With technology, you’ll be sure to get more accurate results, especially if it involves your company’s numbers. That way, you won’t have to worry about miscalculations on your taxes, or other costly slipups that can cost any law firm dearly.
For instance, legal billing software is a must for all solo practitioners. Many private law practitioners have fought malpractice claims because of failing to track their time with clients properly. It could all have been easily resolved if they invested in accurate legal billing software.
Covid has also changed the game in this respect. Remote work is one thing that law firms can ensuire are properly handled with efficiency and effectiveness so that any cloud-based software system can get work handled expeditiously. But a failure to have appropriate software to handle this sort of challenge can create major issues for any firm.
For anyone in the business of starting their own law firm, the need for good technology and systems is essential, particularly with applications like practice management and billing software.
When it comes to billing software,there are at least two choices – either the use of a standalone system or a system that is built into a practice management program.
If data is being entrusted to a third party provider you will need to know precisely how it is being used, where it is being hosted and stored and other key factors.
There are a number of billing software programs available to law firms and one of the keys to starting your firm is to focus on this technology as a cornerstone to the success – or even the survival – of your firm. The software solutions range from programs like Practice Panther to Clio and Xero.
6. Focus on Your Clients
If you’re taking advantage of digital marketing, one of the very important things to ensure is to avoid putting all the spotlight on your firm alone.
What does this mean?
It’s easy to become tempted to talk about yourself and why people should choose your firm over the others. While that is important, knowing what your clients want to know will also matter.
It could be talking about personal injury law, like what it is and when it is applicable. Or answering questions like how the process of court proceedings goes and how long it will take. Get some ideas from your customer service team and start creating informational content about that.
This can be a simple thing that can go a long way in making your clients (and potential clients) feel that you know what you’re doing and that you care about them.
7. Communicate with Your Clients Properly
Contrary to popular belief, legal errors are not the most common cause of legal malpractice claims from clients. Rather, it is the lawyer’s failure to communicate with their clients effectively. This usually results from lawyers failing to deliver what they promised to their clients.
Therefore, it is essential to create a prompt, accurate, and frequent communication process with your clients. This way, you can manage their expectations and ensure they understand their situation and what you can do for them. If you can, document every interaction you have with your client to reduce miscommunication and malpractice suits.
The Bottom Line: Is Starting a Law Firm Hard?
Without a doubt, running your private legal practice is one of the most challenging things you’ll ever do. At some point, you’ll face obstacles that can hinder your business’ growth.
But by focusing upon the key elements of law firm growth and development with your ‘eyes on the ball’ will ensure that starting your own law firm can be an adventure that can really pay off in ways you might never have imagined.
Author Bio:
Dane Panes jump started her career as a writer five years ago. Since then, she has written about topics related to health and fitness and entrepreneurship. Currently she focuses mostly on business management and financing for SMEs. You can find some of her work featured on various websites like CUInsight, Calendar, Appknox, and Flipping Heck!
