Thinking About Opening a Law Firm?
Starting a new law firm, there are so many things to consider it can make your head spin. But, putting together a strategic business plan will help keep you organized and ensure that you have not missed anything important. There are things that you will need to think about and address down the road, however, these are the important things to work on now.
1. Decide on a name. Don’t just think of the immediate future when deciding on a name, think down the road a bit. Right now, calling the firm by your name, such as Elizabeth Miller Law Offices, is great. For now. What about in a year when you want to add an associate or someday a partner? Perhaps something like Miller Law Group or Miller Law Offices would be more appropriate. Choosing a name coincides a bit with choosing the domain. Law firms change names often but if you can plan to avoid that, it’s probably better.
2. Purchase your domains. Once you have chosen a name, buy your domain for your law firm. But don’t buy just one – think of ways that clients will think of your firm. Choose names such as: ampadivorce.com, hurtinanaccident.com, needadivorce.com and the like. This will facilitate people looking for your firm when they cannot remember the name but remember what you do. Whatever helps people find your firm. I have bought several domains, all pointing to my website:
www.managingthebusinessofpracticinglaw.com and
3. Set up your bank accounts. You will need an operating account and a trust account. Many of my clients have found that smaller banks serve their purpose better.
4. Decide your practice area. This could be your prior law firm experience, an area that you are interested in, an area that you feel compassion about. There are many things to consider. Some lawyers start out with just one area of law and as they get busier and the firm grows, their practice expands into other areas.
5. Design a logo. Logos are unique to each individual and I believe exemplifies the company and what they stand for. If you look beyond the picture, there is meaning. My logo – which I did not develop until I wrote my best seller, From Lawyer to Law Firm – How to Manage a Successful Law Business – exemplifies the balance between the practice of law and managing the business of practicing law. A lot of attorneys will use their initials in some kind of decorative design. If you need help coming up with something, reach out to me. There are a lot of companies out there who will bid to design your logo.
6. Website Design and social media. Once you have a logo, company name and your domains, and have decided on an area of law, get a website made. Finances are (usually) an issue when you start out. Get the basics to give you the exposure you need without breaking the bank. You can always add services later. Don’t make the mistake of going without a website. Today, if you don’t have a website, for all intents and purposes, you don’t exist. Make sure to set up a Facebook, LinkedIn, Twitter and Instagram account. They should all be tied to your website. Free marketing is a good thing!
7. Demo case management software. Every case management software out there will do a demo of their programs. If you are unsure, call me and I will help you figure out which software to demo and what programs they integrate with to make your firm efficient. You definitely want a program that does billing and integrates with your bookkeeping program. This will make bookkeeping and trust account reconciliation much easier. Work flows can be set up as well as default folders so when a file is opened the default folders are set up and time line of work and due dates populates. Don’t take the price quote as gospel. Everything is negotiable!!
8. Figure out your office space. Today you don’t need a 1000 square foot office (or larger), receptionist, attorneys’ offices, etc. Thanks especially to Covid, lawyers have learned that working remotely with an office to meet clients is much more cost-efficient. Especially starting out, using an execute office or some other inexpensive way to meet clients will usually work. There are all different kinds of arrangements available depending on what you really need. Some space planning will help you decide on how much space you need.
9. Malpractice Insurance. We live in a litigious society. Malpractice insurance is really a must these days. Shop around and get price quotes.
10. Make it easy for clients to pay you. There are many merchant accounts available that will make it easy for clients to pay you. Some of them are tied to case management software programs with no fees. Make absolutely certain that clients can make payments to your operating or trust account, but, make sure the fees are deducted only from your operating account. Just one less headache to deal with.
11. Support staff. Your need for support staff and how you fill the need will depend on your law practice, area of specialty, office set up and your budget. There is full-time, part-time, virtual and contract help available. Do you want someone to answer the phones? Is the support staff a timekeeper? There are a lot of things to consider. If you need help, call me and we can figure it out together based on your needs. You certainly do not want to pay for full-time help if there is not enough work to do.
12. Outsource help. Remember, however, just because you can do the billing, bookkeeping, social media, etc. does not mean you should. You can outsource help to do administrative functions at much less than the time you are losing not doing legal work. If the administrative functions take 20-30 hours a month and you do it yourself, you are losing between $6000 - $9000 per month. Why not pay someone a fraction of this and devote those hours to working on files and generating money for the firm?
13. Network. Network. Network. Tell everyone that you know that you are going out on your own and what you will be doing. Word of mouth and the personal touch still goes a long way to bringing in business. Be careful however as there are a lot of expensive networking groups out there that will take your money and give you more work to do. Vet the various groups and decide where your money will be best spent. Networking with local chamber of commerce groups and bar associations are a good investment of both time and money.
14. Create a Budget/Positive Cash Flow. You can expect a 30-90 days to get up to speed and create positive cash flow for your firm. You need enough money to stay afloat and keep the law firm going. You can expect a 90 day no cash receipt period. Remember, a budget is only good the day it is written, so go back and review and edit it as needed.
There are so many things to do when you start a new firm. But, it can be a rewarding and awesome experience, provided that you prepare a strategic plan for the methodical execution of the opening of your new law firm.
Need help with managing the business of practicing law? We do law office management and business consultations for attorneys including helping with start-ups.
Call me – Liz Miller, Law Practice Management Consultant at 813-340-9569. Or email me at liz.managementconsultant@gmail.com.
Check out my website at www.fromlawyertolawfirm.com.
