You can improve law firm profits in any number of ways. Depending on your situation, you may have several issues that are causing problems. You need to step back and diagnose the issues, then prioritize what you should do when. Lawyers Marketing Associates (LMA) can help you determine the underlying problems, choose the right solutions, and help implement the right approaches.

Here are suggestions on how to improve your law firm’s profits.

Create and Execute a Strategic Plan

Take a step back and look at the big picture.

  • Where has your firm been?
  • Where is it now?
  • Where do you want it to go?
  • What obstacles within and outside the firm stand in your way?

Coming up with a strategic plan and executing it will help you achieve success, more profitability, and greater job satisfaction.

How to improve law firm profits involves planning for your future. Without it, you can’t:

  • Make the right investments in people and assets to improve your profitability
  • Prioritize your objectives if you don’t know what they are
  • Be competitive without a clear idea of what you want to do
  • Reach financial goals, if you don’t have any in the first place.

Developing a law firm strategy will help you discover your greatest opportunities and threats, develop key performance indicators (KPIs) to measure your progress, and offer the best chance at success and improved profitability.

Do Great Work

How can law firms improve profitability? Attorneys should want to do excellent work for their clients. Ideally, everyone should be self-motivated and proud of their work. A bonus for doing well is it makes your firm more attractive to potential clients.

Word-of-mouth advertising is the oldest and best way to get your name out there. Happy clients talk to their friends and colleagues. If one asks for a recommendation, you’ll probably get it. Other attorneys learn of your great results, talk amongst themselves, and may be more likely to refer clients to you.

You didn’t pay anything for this highly effective way to get clients. Your client paid for your services, plus you get this free marketing and advertising. You should improve this return by using this excellent case for your public relations and content creation efforts. You should get more and better clients and cases as your reputation spreads.

Practice Makes Perfect

A major benefit of strategic planning is it requires a high-altitude, unemotional view of what you’re doing now and could be doing in the future.

  • Does your firm focus on one practice area? If so, is the market for it growing or shrinking? If it’s shrinking, what will you do? Start something new? If it’s growing, what can you do to exploit that growth to increase profitability?
  • Can you leverage this practice to start complementary practice groups that could provide more income and profits from the same or similar clients? Are there new, profitable practice areas you can develop?
  • If you have multiple practice areas, which ones are most profitable? Which ones have the brightest future? How can this potential be realized? Which areas underperform? Would you be better served by trying to turn them around or closing down that part of your firm?

Is Someone or Something Holding You Back?

If your firm has an underperforming practice, is the problem that particular area of law or the partner in charge of that department? If the problem is a non-productive person, you could find someone else for the job or reduce their compensation.

Communicate with Your Clients

Are they happy with your firm? If so, ask them to:

  • Recommend you to others
  • Be featured on your website and promotional materials
  • Pay higher rates that reflect that excellent value they’re receiving. You’ll never get it if you don’t ask.

Ask what else you can do for them. That good will you’ve generated may rub off on other legal services you could provide. If they use other firms for different services, how is that going? If it’s not going well, perhaps that’s a profitable area of expansion for you.

If they’re not happy, find out why, and, if it’s worth it, take actions to keep them as clients.

If They Aren’t Happy, “Fire” Clients Bringing You Down

Choose your clients wisely. Every case is a crapshoot, but some have much longer odds than others. Is the potential reward worth the exposure? Clients you bill hourly who are slow to pay, pick apart every invoice, or try to negotiate lower costs at every opportunity aren’t worth keeping. As much as you may need cash flow, you are spending time that would be better spent finding new, better, more profitable clients.

How Can Law Firms Improve Profitability?

Building, managing, and maintaining a profitable law firm isn’t easy. It takes time, effort, planning, and execution. At LMA, we can take the burden off you by helping to organize your firm in every area necessary for better profits. A consultant for law firms can give you options and make recommendations to grow your firm.  Concentrate on your clients and handling legal matters. Let us worry about the rest. It’s what we do.

Contact LMA today at (919) 637-9144. Let’s get started making your law firm the success it can and should be.