4 Ways to Keep a Law Firm in Top Shape
I wanted to share my four best tips for keeping your law firm in tiptop shape. Clients often reach out to us and share stories of how their books have become unruly and messy.
Tip #1: Trust Account Compliance
Trust Account compliance is perhaps the most important, making it number one. It’s also the pain point that attorneys call us. Almost every attorney that I’ve spoken to worries about the trust account. They know the importance of managing it to the penny. My first tip on compliance is to spend the money on legal technology. It’s not worth your time to create complex workarounds to make it work in QuickBooks without the software. The software is designed to help you keep these accounts manageable. Our favorites are LeanLaw and Clio.
Tip #2: Client Relationship Development
As attorneys and accountants, we get busy with our day-to-day work. In the world we live in today, managing a sweet client experience is paramount to gaining more clients. The more attention you put on the current clients; you will reap the rewards of that attention. Having some surveys to see how your client experience is developing is paramount. It will allow you to make changes and pivots as you see that the experience isn’t going the way you’d like your law firm to be represented.
Tip #3: Manage Client Expenses to the Penny
Client expense management is a place that we see with new clients that can be all over the place. Sometimes, client expenses seem secondary to tracking to the trust account. Mismanagement of client expenses can be an expensive mistake by the law firm. I have written several articles on managing your costs at a law firm. See the articles here.
Tip #4: Analyzing the Data and Tracking KPIs
Not taking the time to look at where you’re moving towards in the future and not looking at how you’re spending or how you’re obtaining clients, and just running your business on autopilot is not a good way to treat your law practice.
I’m always astonished when I speak with attorneys and ask about their long-term and short-term goals. Some lawyers stare back at us and say no one’s ever asked them that question. It’s essential to know what your bottom line is, but also what does it cost for you to run your law firm? What is the minimum monthly amount you need to bring in sales? How much do you need to bring to become profitable for your goals?
These may seem like simple tips, and maybe you are practicing all of them right now at your firm. But there are certain items to ponder. A great accounting professional is your key to moving forward to a profitable future.
If you have any questions about the above tips, feel free to reach out. I’d love to discuss some of these items with you.