The financial success of your business depends on your profit – the amount you keep at the end of the day after paying all your expenses.

In the beginning of your business, you are pretty much entirely focused on revenue because you are already spending as little as you possibly can.

Once you’ve got revenue going, you’ll start to notice that your expenses slowly start to creep up.

And it might feel like for every dollar of revenue you bring in, you add another two dollars of expenses.

That is not a winning proposition.

So, today I’m going to share with you three sure-fire ways to increase your revenue without adding any more overhead.

Way #1: Engage More Prospects

One of your biggest expenses is very likely to be marketing.  You are either spending a lot of money on it or a lot of time on it or both.  If you are marketing and not engaging at least 75% of the prospects calling your office, you are losing a whole lot of profit because getting your phone to ring is where all the cost is.

You’ll increase your revenue without increasing overhead if you just start hearing yes from more prospects.

Way #2:  Offer More (Expensive) Services to Your Clients

You can add more revenue to your office without adding any additional overhead by offering those clients who do say yes additional complementary services.

I did this with the Kids Protection Plan  – adding a more comprehensive form of planning for parents with minor children at home added $1,000 to my fees.

And then I found other services I could provide that my clients wanted and were happy to pay me for.

Once I figured this out, I was collecting an additional $1,000-$3,000 on each engagement with no additional overhead.

Way #3:  Get More Referrals

Every time one of my clients sent me a client, I was increasing my revenue without adding any overhead.

So, I built systems into my office that resulted in more referrals.

I always made sure my clients knew how valuable referrals were to me because I worked that into my client engagement process.  I developed a system in which I could comfortably ask for the referral without feeling strange.  And I was always publicly thankful for all referrals – whether they turned into clients or not – by acknowledging the referrer with thanks in my monthly newsletter.

Try one or all three of these and let me know how much additional revenue you make without increasing your overhead.

One of the biggest challenges for every small business owner is management of cash flow.  Attorneys in business are no exception.

So, how do you do it?  How do you manage cash flow when sometimes there are more expenses at the end of the income?

It starts with awareness.

I always hit my financial objectives IF I knew what they were.

I remember how scary it was to run my business “paycheck to paycheck” so I’ve put together a few things I learned along the way.

1. Bring in more/consistent revenue – stop billing hourly, move to flat fee, and consider a recurring revenue based model. Look at how you can increase the value of each client you serve. Know the lifetime value of each client so you know what you can invest to acquire a client.

2. Recognize you are running a business and that requires investment to grow. Fortunately, in most cases and with the right knowledge, you are your best investment. Much better than the stock market.  Don’t reinvent the wheel. Invest in learning the shortcuts you can take from people who have been there and done what you want to do.

3.  Know your numbers – make sure your chart of accounts is set up well to produce the weekly/monthly reports you need to know if you are on track to meet your projections. Look at your numbers every day, if necessary.  Focus on what you want and then take the action steps to make that a reality.

4. Don’t stop marketing – look for ways to market your business every day that don’t cost much or anything at all. Do some marketing activity everyday and show the money Gods how serious you are about making money by being willing to do things that make you uncomfortable.

5. Know where the problem is and fix it. Is the problem getting your phone to ring? Getting prospects into the office once they do call? Or engaging once they get there? Solve the right problem.

6.  Worst case, manage your payables with open communication and not by hiding.  I used to think every bill had to be paid as soon as I received it, but they actually don’t as long as you are in active communication with your vendors. Don’t hide, just communicate.  Ask for longer payment terms.  Be honest and don’t be afraid to say, I’m having a hard time with cash flow and need help.  The worst thing you can do is just not pay and not communicate.  That’s where you get in trouble. And, what I know is that if you stop paying your bills and not communicating, it’s not long before you start seeing your clients stop paying their bills.

If you haven’t already downloaded my Law Business Manifesto and other practice resources, do so at http://www. LawBusinessRevolution.com.  Tell your friends.

I’ve been where you are and built a million dollar law business with the resources I give you there.

You CAN do this.

Not long ago on the Lawyerist Lab discussion board there was a whole string of discussion regarding how lawyers answer their phones.

As usual when lawyers talk about things like this, I was surprised to hear how many lawyers are answering their own phone when they are in the office or having calls directly transferred to them.

I guess I shouldn’t be surprised though because I used to do it too when I was first in practice and didn’t know any better.

I felt overwhelmed by all there was to do in the early years of my business (even when i didn’t have a whole lot of clients) and yet when the phone rang, I lunged for it like a teenage girl waiting for her suitor to call.  (It could be a client or even better, a prospect!)

Little did I realize how answering my own phone was the worst thing I could possibly do.

It’s counter-intuitive in a way.  I thought I HAD to answer my phone to be a responsive lawyer.  In fact, it’s exactly the opposite. Make these small changes and watch your life (and bank account) improve, dramatically.

1. Have Your Phone Answered With a Smile By Someone Other Than You

Whatever you do, do not let your phone be answered by someone barking “law offices” into the phone upon pick up.  Make sure whoever answers is smiling when they do.

If you have to use voicemail, make your voicemail smile.  Add something quirky or different. So that you come across as a different kind of lawyer right off the bat.  Unless you enjoy being stereotyped in the same bucket as all the other lawyers.

Call Ruby and Total Attorneys both have great services.  (And if you mention I sent you, each of them will likely give you a free test out period.)  I believe Total Attorneys can even schedule appointment for you, which is really important because as you will see below, you want all your phone calls to be scheduled.

2.  Never Take an Unscheduled Call (Except In Case of Emergency)

When you allow the phone to interrupt you and your day even for a few minutes of the time, you will often find yourself at the end of the day wondering why it feels as if you did not get anything done. (a Microsoft study indicated that it can take as much as 15 minutes to get back on task after an interruption and then it often takes longer to get the task completed.  Add up those 15 minutes and you can lose a whole lot of day.)

So, set yourself up so that everything is scheduled. Use time blocking and hire a scheduling assistant to schedule your calls.  Or, if you are more of the virtual type use TimeDriver, Genbook, or BookFresh.

3. Do Better Work & Get More Love

When you stop allowing your phone to interrupt you throughout the day, you are going to get so much more work done and be far more productive.  That means your family is going to be giving you a lot more love because you are going to be home in time for dinner.

Plus, your prospects are going to love you a whole lot more because you are going to be more in demand than if they can get you on the phone right when they call. When’s the last time you got your surgeon on the phone when you called with a question before surgery?

And, your clients are going to love you because you are going to establish right from the first meeting that the reason you don’t take unscheduled calls is because when you are focused on their matter, you are focused and doing great work for them and refuse to be interrupted. When you DO get on the phone, you’ll always be on time (no more annoying phone tag!) and prepared for the call.  You’ll become the responsive lawyer everyone loves.

Finally, you’ll be doing better work.  And ultimately, that’s what it’s all about.

So stop answering your phone and feel the love.

Over the past several months, I’ve done some personal soul-searching about my business and my life.

And I had to look at why I was serving lawyers and whether continuing to do so is the best use of my time, energy and resources.

I made the decision that it was, but only if I was willing to move beyond my safe 2nd stage business and build a business that would radically
and completely change the way legal services are provided to families and small business owners throughout the US and Canada.

To do that, I recognized I’d have to deconstruct my business – release what wasn’t working and re-build on what is and was.

It’s been a difficult process and it’s far from over. But, it’s given me a lot of compassion for those of you who are not satisfied with the old paradigm and are having to deconstruct and reconstruct your law practices to create something truly meaningful.

I wrote about the three stages of the entrepreneurial roadmap on my personal blog a couple of weeks ago and saw that it can help you here too.

So, this week’s Law Business Revolution blog applies the entrepreneurial roadmap to the business of practicing law.

The Law Firm Entrepreneurial Map

The three stages of the entrepreneurial map, as it applies to your law practice transforming into a business.

Stage 1: The True Solo

Stage 1 is all about brand new-ness. It’s about the idea, the vision, and just getting started and getting it done. It’s about figuring out your revenue model (where the money comes from) and getting on the road to freedom.

Generally speaking, you are probably working alone or with a partner. There is no team support or perhaps one person helping youout on a part time basis. (When I first started, I rented office space from other lawyers and my sister sat across the desk from me, helping me out. Within about
three months, I brought in my first part-time employee.)

You have no systems. And probably just one revenue stream, which will be your main service offering. You may be taking anything
that walks through the door just to make your bills.

You are probably charging hourly or very low flat fees.

Many (most?) lawyers remain in Stage 1 indefinitely. You may feel frustrated, tired (or exhausted), and as if you are not making as much of an impact (or money) as you’d like.

Stage 2: Enterprising Entrepreneur

When you get tired of doing it all alone, you’ll bring on some team. That’s one of the major signs you’ve made it beyond Stage 1.

You’ll also begin to realize that there’s a pattern to what you do and how you do it.  Yep, you’ve got systems and processes.

You are still working pretty hard, but you begin spending more time working on your business instead of always in your business.

And you may begin to realize that you can’t take everything that comes through the door – you have to narrow your focus to serving one market or just providing services in one practice area.

Financially, you are doing okay. You know how you make money in your business and you are constantly surprised by how much money it takes to make money.  You’d probably like to keep a bit more than you are.

While you have some team support, you are the one managing the team, for the most part. You dream of the day you get to spend all your time doing the parts of your business you really love and let go of the rest.

Stage 3: Legacy Builder

When you hit Stage 3, your work will continue, even if you aren’t there to do it. You spend your time primarily working either on the business or in the business, but not both.

You are clear on who you serve and what you do for them.

If you got sick, took a long vacation or the long permanent vacation, your business would continue.

You’ve got documented systems and process, a team, and other leaders in the company besides just yourself.

The transition from Stage 2 to Stage 3 will be harder than you expect, at least that’s my experience so far.  But, it will be well worth it.

If you try to make this transition too quickly and without the right people in place, the whole thing will blow up in your face.

No matter where you are today and how far it seems you have to go on the journey, if you are in business for yourself, stop for a minute and celebrate.

You are working for yourself. You are in control of your destiny.  You are on the road to freedom.

Last week I wrote about how to avoid going out of business. If you missed it, you can read the full thing here.

A few lawyers wrote me back and said that they didn’t know what kind of massive action to take. So, I want to give you a little action plan to see results happen immediately.

If you are a decent speaker, it’s time for you to get on the phone and start telling everyone you know that you are available to come out and speak to their group.

If you are not seeing enough clients and do not have the money to do paid marketing, you must take control of the situation and get yourself out there and speaking. And don’t sit back and wait for the speaking engagements to show up or rely only on someone else to book them for you.

Do not just try one thing, see if it works, and then try another. Do everything. All at once.

When I was building my practice, I was on the phone constantly lining up speaking engagements. Eventually, I had someone else do that for me, but not in the beginning. In the beginning (when I didn’t have any money) I did it myself. After hours, before hours, during hours. I busted my butt to make sure I did what was necessary to get me in front of the people I needed to speak to about my services.

So, if you are struggling, ask yourself … am I doing everything I can to get myself out there speaking to as many people as possible for free? Am I on the phone in every free minute of my day with local groups in my community such as:

* Church groups
* Daycares
* Preschools
* Senior Centers
* Private Schools
* Public Schools
* Moms Groups
* CPA Groups
* Real Estate Agents Offices
* Title Officers
* Mortgage Brokers
* Chambers of Commerce
* Community Centers
* Rotary Clubs
* Business groups

I could go on and on.

There was even one time I went out to speak to a group of women (I think it was some sort of an alumni group), which consisted of 4 little old ladies who would get together for coffee on a monthly basis.

I would show up anywhere they would let me come and speak. Sometimes it paid off, sometimes it didn’t.

But, here’s what I can tell you, the more I did, the more my phone rang and the more clients I got.

One of the Personal Family Lawyers who has been with me since 2007 just came back from taking a few months off to have her baby and she is booked all the way through April with 13 new client appointments in March and 21 speaking engagements between now and June. Why? Massive right action before she went out on leave to have her baby. You can do it too.

So if you are struggling, don’t just sit there and wait until you get pulled under the water hoping someone comes and rescues you; do something and do it now!

Next week I’m going to talk to you about the logistics of getting maximum results from your speaking engagements, but in the meantime, pick up the phone and get yourself booked in front of a group. We’ll pick up here next week.

Over the past few weeks, I’ve been connecting with lawyers who are struggling mightily to make this law business thing work. Know anyone like that?

Fortunately, I also get to talk with a lot of lawyers whoare NOT struggling for clients. They’re struggling with  too much business and needing to get their systems caught up to the client flow (that’s the last frontier before really having it all).

And while I’ve got some guidance for those of you in that boat, today I want to focus on those of you struggling for more business because if you don’t have business, you’ll never get to phase 2 before you go out of business.

Now, I know a little about going out of business. I’ve watched lawyers do it more than once and one time, unfortunately, up close and personal, after the guy I sold my firm to couldn’t make a go of it and closed up shop.

So I know what will run your business into the ground faster than you can say “wait a minute, where did all my money go?”

And I can see the lawyers who are headed into the station of no more business as opposed to those headed to phase 2 and one major step closer to the lives they really want in which they are serving the clients they love without stress and not worrying about the day to day details of running their business.

So, what’s the difference?

Continue reading In Danger of Going Out of Business on Lawyerist.com

I’m writing to you today about how to deal with your email overwhelm because I have no doubt that it’s a problem that may be keeping you up at night (or at least in the office too long).

So, here’s what I recommend:

1. Set up a private gmail account and only give the email address out to your family members and closest friends. Do not sign up for any email newsletters, special offers or anything else with your new private gmail account.

2. Hand your public email account over to an assistant. If you have an assistant in house, give him/her the password
so that s/he can begin managing the account for you. If you don’t, this would be a perfect opportunity for you to start
working with a virtual assistant who can manage your email for you.

3. Give your assistant specific rules about how to handle your email. Here are some ideas that should get you
started:

• filter all newsletters into a special folder that you can review periodically (except of course the Law Business Revolution Weekly Briefing Memo, which you’ll always want to review as soon as it comes out each week )
• filter all listserve/forum emails into separate folders you can also review periodically.
• respond to all client emails the same way that phone calls would be handled – either schedule an appointment, pass the request on to the person who needs to handle it with a tickler to follow up and make sure it’s been handled, or send to your private email inbox to review. If sent to your inbox for review, make sure your email assistant schedules you time to review the item on your calendar.
• respond to all emails from opposing counsel or other colleagues in the same way – indicate message has been received and either schedule appointment for follow up or schedule you time to review and indicate the follow up that is necessary.

This should get you started and get you out of email overwhelm.

I’d love to hear what questions you have about managing your email and your law business. Let me know.

It’s time for you to make a substantial shift in the way you’ve been thinking about what you have to offer prospects and clients.

To generate more leads, get more prospects to YES and increase your fees in a time of price-slashing and economic hardship, it’s time for you to begin focusing on VALUE and OUTCOMES instead of the specifics of your legal service.

It goes back to a point I made in last week’s article about how you can raise your fees, even in a tough economy.  If you give your prospects no other reason to choose you outside of price, you’ll wind up being price-shopped right out of business.

But, there is another way.

When you begin focusing on the VALUE you provide and the OUTCOME client’s will experience when working with you, there is no shopping around .

Let me give you a simple example of what selling OUTCOMES, as opposed to legal services would look like for the small/micro business owner market:

Prospect:      I can form my LLC online for $150 or with a lawyer who charges much less than you do; why would I pay you more than   the guy down the street?

You:     Yes, you can absolutely form your LLC online for $150 or with that guy down the street for a few hundred bucks, but I’ll ask you two questions: 1) are you sure you really need an LLC?   In many cases, forming an LLC is the wrong choice and could cost you thousands of dollars.  And 2) do you really want to put your business in the hands of a cut-rate lawyer?

Where and how you incorporate your business entity is just the first of many choices you’ll have to make if you want to grow a business that will fulfill on its mission and support your family without putting your personal assets at risk.   When you go online or with a lawyer who doesn’t do anything more than complete form documents for you, are you going to have somewhere to turn when you have questions or when things come up in your business?  Or are you going to make decisions that could turn costly because you didn’t have the guidance of someone you trust?

When you work with me, I’ll make sure you ask all the right questions and get the answers you need to build a profitable and sustainable business.   That’s not something you are going to get from an online document service or a guy who completes some documents for you and sends you on your way.

You don’t really know what you need and what you don’t need and the cost of overlooking things you don’t even know about will be far higher than the fees you’ll pay to work with me.

As your lawyer for the life of your business, you’ll never have to worry that you are paying too much in taxes or for insurance you don’t need or that you have to sign an agreement without getting it reviewed because you are concerned about what it will cost you to contact me.

You get the point.

We have shifted the discussion away from legal documents or even pricing to instead talk about the outcome.

In fact, this is so important that I’m going to hold a contest.

Post in the comments below regarding what you see as the outcome(s) we are selling and will be basing pricing on in the above script.

Everyone who comments and gets the right answer will be entered into a drawing for my Client Attraction System, which we just sold for $997.

I’ll be discussing more about selling outcome instead of focusing on legal services and price as it relates to serving the small business community on Thursday, March 18th at 10 am PST/ 1 pm EST.  Join me.  I’ll also be giving you information on how to join our Creative Business Lawyer program.  Our beta class is already getting inquiries from entrepreneurs looking for a Creative Business Lawyer for their business.  For more information and registration details, please visit: http//www.lawbusinessrevoluton.com/cblcall

If you’ve been reading my Law Business Revolution Briefing Memorandum for any amount of time, you’ll know that I’m NOT a fan of hourly billing or you selling yourself short in the name of a “sluggish economy” or for any other reason.

I just had a laser coaching session with a lawyer last week who told me she didn’t want to build the kind of practice I had because she wanted to keep her fees low.  After talking with me though, she was able to see that not valuing the services she provides isn’t going to help her help more people, it’s going to run her into bankruptcy.

It’s heartbreaking to watch so many lawyers go out of business or not bring home enough bacon simply because they get trapped into thinking about their pricing the wrong way.

When you differentiate yourself based on price, you simply cannot provide value.  You end up competing on the wrong basis.

While price competitors have been in operation since beginning of time, it’s important to understand that if YOU want to build a sustainable, scalable and one day SALEable law business, a core foundational piece of that puzzle is that you are charging enough.

Is that possible in this economy?  Absolutely.

Let me shift your thinking outside the legal world and into the business world for a moment.  Stores that offer super low prices like Wal-Mart and Target are thriving in this economy.  So with that logic, you’d expect high-end stores like Nordstrom or Sacks 5th Avenue to be out of business right now…but they’re not.  In fact, Nordstrom’s profits more than doubled in the quarter ending Jan. 30 according to the WSJ.  Luxury cars like Mercedes and BMW also reported profits last year despite the fact that “no one has money to spend.”

And lawyers doing things the PFL Way are thriving, while charging much higher fees than their “competitors”. How can that be?
It’s simple, really.  People DO have money to spend… you’re simply not doing a good enough job showing them that your law firm is the best place to spend it.

You see, it’s all about the value.  And I’d suspect that you are not clear enough on the value you provide to convey it to your prospects.

This isn’t “blind theory” or Alexis Martin Neely’s random thoughts on life either.  I’ve done it, our Personal Family Lawyers® and Creative Business Lawyers™ are DOING it and so are millions of other small business owners/ entrepreneurs in this country right now.

So how are they doing it?  Here are some things you can do right now:

1. Stop Acting Like a Commodity.

Your prospects have no way to know if you are the best lawyer for them.  To regular folks, all lawyers are the same.  So when you compete on price, you’ll get price shoppers galore who see you as just like everyone else.   But, you are not like all the other lawyers, are you?

So, what makes you different?  And how do you show that to the marketplace?  That’s what you need to focus on and show the world.

2. Identify the Value of the Outcome You Provide.

Why can Nordstrom’s charge higher prices for products found elsewhere (i.e. cars, purses, ties, shoes)?  It’s because of the VALUE they’ve attached to their brand (i.e. social prestige, enhanced customer service, increased self-esteem).   They’ve moved themselves out of the commodity market and into the heart, emotion and primal urges of their clients.   You need to do the same thing in your law firm.  Yes, Mr. Customer can get an estate plan for $399 or set up their LLC for $750 or a bankruptcy for $1125 down the street, but what are they NOT getting when they work with that other firm or even worse go online to do it themselves?

3. Move Beyond the Billable Hour

There are only so many hours in a day and you’ll reach an income plateau very quickly when you are billing by the hour. Not to mention that you have to start every month over at zero and there’s absolutely no stability in that.  No matter what practice area you are in (with the exception of contested matters), you can begin billing on a flat-fee/value basis.   If you’re scared to shift, just think of the VALUE your customers will experience having an attorney using flat fee billing.  They won’t be nickel and dimed for every phone call, email and fax that comes through the office.  They can communicate with you as they wish without fear and they can pick their price point of choice if you have membership options.  And believe me, people are willing to pay more for certainty every time.  It’s a win-win for them– and it’s very much a win-win for the health/sustainability of your law firm.

Remember this:  People still have money to spend… even in this economy.  And they NEED your services.  It’s up to you to convey the intrinsic value of working with you (even at a higher price point) to command the income level you want…and rightfully deserve…this year.

PS- If you serve small business owners and want more information after reading this article on how you can participate in our Creative Business Lawyer Program and serve the entrepreneurial/business owner market using flat-fee, membership-based billing and differentiate yourself from all the other business lawyers out there, mark your calendar for March 18th at 12pm PT/3pm ET.  More details coming soon!

Over the past few weeks, I’ve talked to you a lot about “mindset” and that you’ve got to start thinking about your law firm as a business if you want to enjoy the freedom that inspired you to start your business in the first place.

There’s one major place small firm and solo attorneys get hung up that will keep you running a practice instead of owning a business –and that’s investing in the support staff you need to take some of the heavy administrative and marketing burdens off your plate.

I hear so many excuses from lawyers who desperately need help but sabotage themselves with “I can’t afford it” or “I can’t trust anyone else to do the work” or “It’s easier to just do it myself or “I don’t have space for an assistant” thinking.

If you don’t make the investment in key support staff to assist you in the operations of your firm, you’ll never grow beyond your current earning capacity and you won’t be able to serve your clients as well as you possibly could.

At the same time, you don’t want to get into a situation where you have too much support, which will result in bloated overhead and you keeping very little of your money.

These days, I do as much as possible with virtual support instead of having people in-house.  And in my best years in the law firm it was the same.

My worst years from an emotional perspective were when I had 7 staff members and a $70,000 per month overhead.  Talk about stress!

Fortunately, the following year after that one, I figured out how to keep my revenue the same with only three full time employees and outsourcing the rest.

So, how do you know if you have too much, too little or just the right amount?

For one week do the following:

1. Write down every single thing you do on a daily basis as it relates to your business.   Track your time down to minute and be sure to include seemingly minute tasks such as, “called the courier and arranged pick up of my court documents” to “ordered coffee for the office”.  Have every person on your team do the same.

2.  At the end of the week, circle everything on your list that could have been done by someone else.  And closely examine what your team members were doing.

3.  Make adjustments once you see how your time and your team are really operating.  It can be hard to see what’s really going on, but it’s always worth it.  Add up the number of hours you spent on the items you circles in step 2 and calculate how much more revenue you could have brought in if you had spent that time in revenue generating (or marketing) activities instead.

Once you see what’s really going on, you can make decisions with knowledge instead of remaining in the dark about your business.