Tom Kane wrote a good blogposting this week on the importance of building a web presence as a small law firm, referencing an another excellent blogposting by the Attorney Marketing Blog on the same issue.
I completely agree with Tom Kane and the Attorney Marketing Blog: while lawyers as group continue to have the perception that big firms have the resources to better market themselves than small firms, the truth of the matter is that they do not do so, particularly when it comes to the web.
Why is this the case? My personal opinion is because you have a separate marketing department at these firms, so that marketing continues to be divorced from the practice of law. Also, I think it has to do with who makes the decisions at large firms: you rarely see a 30 year old attorney at a large firm calling the shots. The simple fact of the matter is that younger attorneys are more likely to understand the value of the web than older attorneys, and therefore put more resources into it. Younger attorneys are also more likely to embrace new technologies and to try things on the web that haven't been done before.
Regardless of the reasons, however, the lack of attention to the web by large firms creates a huge opportunity for start-up lawyers to develop their own web presence on the web and really dominate the Internet for their practice areas. Proper investment of resources in the web can have a huge payoff in terms of building the ideal practice you are seeking for yourself and for your firm. My experience is the perfect example of this: I started my firm after relocating to California from the Southeast only 3 years earlier. Almost all of my clients have come from the web. If I had not devoted the resources I did to the web early on, I would have starved, as it has taken a while for my more traditional business development efforts to bear any fruit.
So, if you have some extra time on your hands this summer due to the recession, take a few minutes to assess your web development strategy, and consider what resources you might be able to divert toward taking the next steps with your web presence. I think you will find that such efforts will prove to be well worth your time and money.
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Law.com ran an article last summer titled "Nine Steps Law Firms Can Take to Get Paid." While the article was directed at established firms rather than start-ups, it did provide a few good pieces of advice that can be applied to the start-up firm environment.
First of all, understand how important it is to collect your bills within the first 30 days of sending them out. The longer the bill goes unpaid, the more likely it is that you will never get paid. So, stay on top of the collection issue.
Second, it is an excellent idea to use professionals to help you collect your bills. If they get more than 90 days past due, you will likely never see the bill, so at that point, it makes sense to bring someone else in to help you collect. Having said this, bringing in the right help is more difficult than it seems. Since I've started my firm, I've gone through quite a few vendors, and I've only recently found one that I'm happy with. Having said this, I recommend that you start working on finding the right vendor sooner rather than later, since finding the right partnership can be a huge asset for your firm.
Third, learning how to run accounts receivable reports is a worthwhile thing to do--it is helpful to see where your firm stands in writing, even when you have the contents of your reports imprinted across your brain. I recently started running regular accounts receivable reports and find it very helpful to have them in front of me on my desk, to remind me where the firm stands at all times.
I have one other piece of advice: make sure your clients know that you do not intend to write-off your bills, if you are serious about collecting them. I have found over the last few years that many clients are aware of the fact that firms often write-off unpaid bills without seriously pursuing them. If, like many start-up firms, you can't afford to write-off client bills, then you need to make sure your past due clients understand this sooner rather than later. In my experience, communication can be very helpful in speeding up the payment process.
All in all, like the article suggests, the best way to collect on your bills is to be proactive. When businesses are short of cash, they tend to pay the most pressing bills first. It is your job to make sure that your bill falls at the top of the "most pressing" category.
]]>I wrote about how companies should consider renegotiating their vendor contracts in a blogposting for my Silicon Valley IP Licensing Law Blog. In that posting, I was talking about non-lawyer businesses, but the truth of the matter is that we as lawyers should follow our own advice and look at where we are spending our money in this economy, too.
If your firm is like most businesses, you likely have relationships at the very least with one or more telephone companies, a cable company, one or more independent contractors, web host providers, and a few insurance companies. Have you taken another look at those relationships and looked at whether you can reduce any of your costs?
We as lawyers sometimes get so focused on advising our clients and helping them with their legal issues that we sometimes forget to manage our own. However, start-up law firms have financial pressures just like our clients do, and we lawyers need to focus on reducing our monthly costs in this economy just like our clients are doing.
So, if you have not pulled out your cable service contract lately, or looked at your monthly telephone bill and priced out your alternatives or called the service provider to negotiate a reduction, now may be the ideal time to do so. Set aside some time this week to look at your law firm budget and see where you can make some cuts.
]]>Tom shared in his blogpost some suggestions taken from an article Stacy West Clark published in The Legal Intelligencer, "25 Value-Added Services to Offer Your Clients for Free." Tom's suggestions were as follows:
While I am not sure that all of the tips are relevant for most start-up lawyers (for example, I rarely have tickets to give away to clients the way that I did when I was at my prior law firm), I think the advice still has merit. As start-up lawyers, the tendency is to think about the short-term: bringing money in the door right now, so you can keep the lights on. However, in a tough economy like this, there are limits to what you can do today to bring in business, so it makes sense to take a longer view and think ahead to the future, when the economy improves. And one of the things we can definitely do to build our relationships for the future is to focus on developing relationships with our existing clients to the extent possible.
So, instead of just spinning your wheels trying to figure out how to pay the bills, why not take a few minutes each day to think about the value you can add to your existing relationships, whether they be existing clients, past clients, or mere prospects or potential referral sources? In all likelihood, those few minutes will prove to be a worthwhile investment in the future of your business.
]]>The SBA ARC Loan Program is designed to help struggling small businesses who have been profitable in the past but need some additional help right now.
Who is eligible for an ARC Loan?
According to the SBA, the following businesses are good candidates for an ARC loan;
Your small business must be an established business, have financial statements demonstrating it was profitable in one of the past three years, and be able to project sufficient cash flow to meet current and future loan payments over a two-year period from loan approval. If your business does not meet these criteria, you can discuss your eligibility with your lender.
For those who qualify, you can take advantage of some very favorable loan terms, which include as follows:
Another benefit: the loan terms carry a 100 percent guaranty from the SBA to the lender, so you are hopefully not going to be disqualified for lack of securitable assets.
Unfortunately, in investigating this program, I have uncovered one very big problem with the whole program: no one seems to know who is making the loans. If you call the local or national SBA offices, they are unable to tell you. Similarly, if you call SBA lenders listed on the SBA lender list, they cannot tell you who is making the loans either. Obviously, this is a problem, as it is difficult to apply for an ARC loan if you cannot locate a single lender making them.
Incidentally, in making calls, someone was kind enough to return my call and acknowledge what I had already determined: that there was in fact a problem with the program roll-out. Apparently, the SBA has been moving so slowly in getting infromation to lenders that no one is quite sure what is going on or whether or not they will be participating. Moreover, I was told that by the time the program finally comes together, it may be that most small businesses who would have qualified will no longer need the money any more.
Needless to say, that is not going to be encouraging news to those small businesses in dire need of immediate assistance. It is not as if there are a lot of other small business loan options right now.
So, the bottom line is that this loan program should be on your radar screen if you are a small law firm meeting the criteria; however, you should not rely on it to provide you immediate assistance. The challenge may very well be to find a participating lender.
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