In our current economic climate, every one of us turning our eyes in all directions to spot an opportunity to make more money and law firms are no exception to this. If you are looking forward to gifting your law firm’s pocket some profit, here are a few not-so-obvious ways to increase your law firm's revenue stream aside from raising your billing rates.
Manage the Practice of Law with a Software Program
Take the Paperless Route
Using your memory to process all the data at the end of a day or week may result in you losing billable time. Utilize practice management software to track and easily capture time. Among the technologies Rocket Matter offers is Bill as You Work, which has up to ten different ways to capture time.
Paperless offices boost law firm revenue by reducing costs on supplies, storage, labor, rental space, equipment, and more. Despite the fact that these savings are more about profit, the improved efficiency and time savings can lead to increased marketing opportunities and increased revenue.
Enhance the Billing Realization Rate
Realization rate refers to the percentage of time recorded to bill clients which get charged. Most law firms write off the amount that is not billed to clients for many reasons, including time spent on projects, issues, and less than optimal practices that cannot be justified to clients. Firms should be able to achieve a realization rate of 90% to 95%.
It is important to track time and achieve a high billing realization rate, but your ultimate objective should be to maximize your revenue. In most cases, it's like giving away money by delaying your billing. In essence, you are offering interest-free financing by failing to pay your bills on time. Due to late bills and cut cash flow, your business misses out on investing in growth opportunities.
Outsource billing able work that you routinely do and can offload to paralegals for their litigation support services. By doing so, you will have more time to work on matters with high billing rates and create opportunities for new clients. As more states permit paralegals to perform tasks previously performed by lawyers like litigation support services for example, this is particularly significant.
Adapt Fee Structures to Meet Client Needs
Hourly or flat fee billing? What about retainers? Is there a contingency plan? There is no single billing method that fits all situations, and an imbalance can cause a cash-flow problem. You must be knowledgeable about the different types of fee agreements and understand them thoroughly to effectively explore the options and select one that best suits your circumstances. Make sure you communicate the fee structure to your client so that there are no surprises, delays, or write-offs.
Fire the Clients
The number of clients does not always translate into higher revenue. You won't be able to land or accept a lucrative case if you spend too much time working for a nonpaying or unreasonable client. For new operations, it can be particularly difficult to fire a client, but it is crucial. Choose clients wisely: Protecting Your Bottom Line.
Take Advantage of Home Offices or Co-Working Spaces
COVID has caused social distancing and cheaper rent overhead to make home offices very popular. Working at a co-working space can help you keep your costs low while also allowing you to network. Additionally, you can meet face-to-face with clients without having to host them in your home.
A Transparent Client-Supplier Relationship
Eric Ries's "The Lean Startup" popularized lean thinking. Waste reduction, testing, and iteration are core principles of the method. Agile methodologies, including Kanban boards, can assist law firms in increasing efficiency, transparency, and accountability. Identifying bottlenecks and resolving them allows firms to increase efficiency with more time for landing new clients.
So now that you are updates with these tips, we hope that you soon take a step to increase your revenues and provide your firm a direction to reach greater heights.
During client intake and throughout your handling of the matter, be upfront and transparent about your service, process, and fees for your products and services. Your law firm's revenue increases as a result of realistic expectations and less haggling over unforeseen costs.
Focus Your Practice on Current Issues
Could your current field of practice become less lucrative or irrelevant? Maybe there's a need for an area of specialization that covers hot topics. In light of the growing legalization of marijuana in more states, same-sex marriage and divorce may become the norm soon.
It is easier than ever for a marketer to enter the field. The ability to create Google ads, Facebook campaigns, and YouTube videos for their litigation support services are available to anyone with a laptop. Don't limit yourself to the usual, explore the obscure. Consider hosting a webinar, writing an eBook, or starting a legal blog.
It's marketing, for sure. However, how about sales? Marketing has been disdained for a long time by many old-guard firms. Think about how they approach sales. Marketing for l litigation support services and products will naturally evolve into sales. Even though it operates under the pseudonym "business development," sales consulting already exists.
Invest in a Virtual Assistant
A virtual assistant can make a significant difference to the bottom line of your litigation support services. Services from companies such as Smith.ai can handle a variety of tasks including answering and routing calls, website chats, text messages, and Facebook messages. Your communications will be monitored 24/7, and you will never miss a potential client again.
Using Freelancing Attorneys
Legal firms spend a lot of money on payroll. Businesses that rely on freelance attorneys for their litigation support services as needed can avoid turning down revenue by not turning down work. Check out sites like LAW CLERK where you can hire virtual associates and vetted freelance lawyers and get litigation support services.
Streamline Your Intake Process
Despite an increase in business leads, why do firms decline to accept cases? Insufficient client intake processes are to blame. Increase revenue of law firms by improving intake processes, taking on more cases, and taking on a greater number of cases. An excellent discussion can be found at Best Practices for Effective Law Firm Client Intake.
Implement "Lean" and "Agile" Concepts
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