Top 5 mistakes when starting a legal business
Many seasoned lawyers dream of starting their own business. Despite having a degree in law and having a lot of zeal, you still need to have a basic understanding of the laws that govern the world in order to succeed. How can a lawyer launch a full-fledged legal firm from the beginning without spending any money in order to avoid burning out? Organizing, starting, and operating a legal business incorrectly.
“I will do everything”
Choosing a practice profile, or speciality, is a decision that is best made early in the planning process. The unique nature of the industry of professional services is that only certain specialists are prized there, and a potential client is less likely to be confident if they have a “generic profile.” As a result, we advise choosing a speciality at the very start of your business.
What are the types of specializations?
Based on our experience, as well as the experience of our Partners, there are 2 main ways to go in order to decide on a specialization.
By type of clients – servicing individuals or legal entities. The simplest type of specialization, which allows you to divide customers into 2 large groups and abandon one in favor of the other.
In the field of law – criminal, civil, tax, customs, etc. A narrower division, from a professional point of view. You can also combine and deal, for example, with the bankruptcy of individuals only.
“As soon as I rent an office, clients will immediately run up to me because I will have an office”
The beauty of the legal business is that you can open an office for work even in your apartment. We are talking about the fact that the office, especially in the initial stages, is not a necessity at all. The first task is to find clients. Why do you need an office that will be empty?
Rent an office when you need it. If you have plans to hire an appointment assistant in the near future, then rent a small office at 20-25 meters. Today, there are aggregators for renting offices, business centers, coworking spaces and meeting rooms, such as Matchoffice. This placement solution will be an excellent springboard for your personal legal practice. It’s not expensive, but it will give you all the benefits of an office: image, convenience, recruitment and expansion potential.
Underestimating the need for a business plan
The establishment of a legal practice is largely a business concept that needs careful research. You must assess the idea’s scope, intended efficiency, payback, supply and demand ratio, and consider and picture the services you will offer to clients in order to determine whether it is feasible to implement. This calls for a thorough business plan.
What is a business plan for a law firm?
At this stage, you will think over the legal form, specify the specialization and list of services, determine the required office space, the number of jobs, etc.
Analysis of the service market and competition
An analysis of the legal services market in the region will help you not only determine your own specialization, but also identify the weaknesses of competitors in order to make your firm better.
One of the most crucial components of a business plan for professional services is the investment in marketing. The fact that the service you provide cannot be seen, touched, or tasted must be crystal apparent to you. The only effective approach to draw clients is through an advertising strategy, which should, of course, be planned from the very beginning of the business (or better yet, begin cultivating a prospective audience even before launching!).
Detailed financial calculations – how much you plan to spend and how much to receive.
It is important not only to consider what risks are most likely for a future law firm, but also what consequences they can lead to, as well as how to eliminate them.
A business plan will help you sort out all your ideas and immediately assess all possible risks and probabilities of losing the funds invested in the business.
“I promote myself and sell my story”
Another misconception and error of lawyers is that they advertise themselves. Not your services, but yourself. Without formulating exact services, the lawyer begins to promote himself as a professional with a specific photo and name, but without a specific specialization. Money invested in advertising goes to waste. Business development is impossible.
Advertise specific services that you are a master at. You will always find your Client. It is enough just to set up contextual advertising specifically for your services. Advertise for exactly 1 service. Make a site with one service (landing page), and lead customers to it. Then you will receive requests from potential Clients who are looking for this particular service.
Hire a full staff of law firm employees
And why would you require them when you are only beginning your own firm and uncertain of the future? If criminal law is intended to be the main or one of the specializations, a law firm needs professionals in staff with specialized education, at least minimal practical experience, and the status of a lawyer. The rest is not important. You can consider recruiting more employees as your company starts to grow and prosper.