Starting a law firm is a daunting task. You have completed years of study and likely even more years of work in an existing firm and now you’re ready to take the next step into entrepreneurialism. While you may have the technical expertise and legal know-how, one thing you wouldn’t have learnt in your years of experience is what it takes to run a business.
Many think starting a business is one big decision, however it involves hundreds of small decisions that ultimately lead to a successful business. Building the fundamentals of a small business can take up to a year but most small businesses taking at least two to three years to reach profitability. Consider these 5 tips for starting your own law firm.
1. Start Networking prior to opening
If you’re opening a new law firm, one of your first concerns should be how are you going to get business in the door. Clients aren’t just going to use your services without any prompt or promotion, and unfortunately ‘hope’ is not a strategy. Fortunately technology is readily available that we can use to connect with others. Setting up social media platforms like LinkedIn or Facebook prior to opening can quickly turn your network into a potential source of new business. Creating demand prior to opening will assist with early cashflow, which is a massive hurdle for most businesses.
2. Hire the right people.
While you may not be looking to hire people right away, it is always good to be on the lookout for talent. People are always at the centre of success and hiring the right ones will put you on the right path. Getting employees on board with the vision of your firm will make sure everyone is working towards the same goal. A motivated workforce, all driving in the same direction will drive growth, and drive it quickly. For anyone starting up, growth should always be on your mind, and the mind of your staff.
3. Goal Setting
Having a vision is important but planning how you will get there is what will keep you focused and on the right path. Goal setting should consist of a long-term objective and the steps in place to get there. They should be challenging enough to help set you apart from your competition and be the difference between mediocrity and excellence. It is important to ensure goals are achievable yet challenge you and your team to grow. Goals can be financial, client based or anything in between.
For example, you could set a goal to complete 5 matters in the first month of business. To achieve this you will need to outline the steps such as how you plan to find the clients, how much time you will need to allocate to each and so on.
4. Reduce your overheads from the start
Keeping your costs low in the early days of your business will give it the time that it needs to get established and become stable. To avoid having to cut costs later down the track, make sure you are making the most budget friendly options. This means once your comfortable with your profit margin you can expand where necessary. To be the best you don’t need the most expensive programs or resources. Simple examples include being paperless saving roughly $500 a year, negotiate your office lease or utilising free tools and offers.
5. Adopt Technology from the get-go
Failing to adapt to technology can be the difference between success and failure. Law firms that can embrace technology early, can easily compete with existing firms. Choosing practice management and legal search platforms that suit your financial and time-based goals are crucial. Don’t get stuck using outdated tech because that’s what your old firm was using. Get ahead by doing some research, sending out a few enquiries and finding the right technology for you.
While these tips will help in starting your law firm and encourage growth, there’s never a perfect plan. You need to prepare a plan and mission but still be flexible to change.
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