Chapter 2 - How Do I Get My Clients?
By being a prepared and confident attorney. Until then, clients are irrelevant. So, this chapter was named in a deliberately misleading way in order to impress upon you that losing clients is much easier than keeping them. In order to keep them, you need to deliver competence and efficiency. This cannot be over-emphasized. This chapter focuses on efficiency. The next chapter discusses competence.
The law practice delivers personal services. For that reason, attorneys are in a unique situation. You can charge $200, $300 and higher hourly rates with no inventories, minimal equipment, and almost no overhead.
But wait! We need office space. We need receptionists and legal assistants. We need copiers as big as Volkswagens. We are attorneys. This is what attorneys do.
This is part of the "entitlement myth" under which so many attorneys suffer. If you want to guarantee failure, go out right this minute, sign a 3-year lease, get a big copier and hire a legal assistant. Good luck with that. While you are at it, run some ads that cost you $1,500 per month. You will be broke before you know it. You will be back to blasting out resumes for a J- O-B, and you will think, "Well, I guess I'm just not cut-out to build my own practice."
In the market - the brutal market where supply and demand rule - lawyers are not entitled to anything. They have to figure out what customers want. A client comes to you for your service. He might be a contractor who built a building and the owner refused to pay his final draw of $24,000. This has put him in a pinch. He needs you to help him collect.
Does he care whether you have a receptionist? Why of course, he does! When he dials your number, the odds are pretty slim he wants to talk to you. He is more interested in how your receptionist's kids performed in the school play.
Get over it. Receptionists are expensive ego-strokers for lawyers. Clients do not care if you have one, and in fact, they would probably rather you did not. That way, they know their calls are not being filtered. When they dial the number, the person they want to talk to is the person who answers… you! That's service!
You are meeting demand by not taking on unnecessary overhead. A receptionist/legal assistant will probably cost you $2,400 per month. At $200 per hour, that is 12 hours you have to work to pay for him or her. Back in the days of old, typing was considered a special skill. These days, typing is a universal skill. The market knows this. Efficiency is the name of the game. The job of legal assistant will soon be listed among endangered species. You cannot give away six days of your work to stroke your ego and try to use a receptionist as a means to convince clients that this little status symbol means you are successful. This six hours is almost 30% of your monthly goal at two hours per day. Do not waste it.
If you think in terms of $200 per hour times eight hours per day, the outlaw for a receptionist or legal assistant sounds tiny in the grand scheme, but remember there is an attorney glut out there. You are not likely to find eight billable, collectable hours every day. Consider the fact that most who are reading this book would dream of making even $100,000 per year. This includes veteran attorneys who have many years of experience. This goal involves only two hours per day. And this is your dream! Think about that. Think about it until it burns the myth right out of your head. Attorneys everywhere are struggling to find two hours per day to bill and collect. Do not base your foundational plan on more than two hours per day.
The 12 hours you waste on a receptionist - who only gets in the way of client satisfaction - is costing you almost one-third of your goal. This book is about setting a foundation to make good money. Set the foundation first, and if later, you have enough money to stroke your ego, then, hire staff. But unless you are extremely busy and really need the help (hint: you must be making $350k to be that busy) do not say you were not told how wasteful and destructive egos can be.
"O.K. I'll work by my lonesome in a nice office somewhere." If you cannot predict where this book is going next, you are not getting it yet… but you will.
What do you need to do your job? You need a brain, a computer, a phone, a fax and a small cache of office supplies. Did "office" make that list? Far too many attorneys are so fixed inside the "entitlement mentality" that they just cannot imagine the humility of practicing from home and being mobile and "on the go." Too bad. This, again, is a number-one reason why lawyers cannot succeed in starting a practice from scratch. Get over the ego. There are ways to deal with it and hide the shame from the client.
Be confident when you have to tell a prospective client you do not have an office in some office building somewhere. When they ask, "Where do you office?," tell them something like this:
My practice keeps me moving so much, from clients' places of business, to the courthouse, to mediations, etc., that I couldn't justify paying for an office when I'm not there barely 1/2 the time. If I am at home and a client needs a motion right away, I can just do it right then and there. It's better than having to hop in a car, fight traffic, and all that jazz. I just meet clients at their places of business, or if they prefer, at a restaurant. I love meeting clients over a meal or a cup of coffee. It gets me out and about.
You would be surprised at how many clients say, "Okay, when can we meet?" They want to talk more about their case and what you can do to help. They are far less interested in your justification for not paying rent for an office that you do not need.
The same goes for legal assistants. Tell the client:
Attorneys get paid these hourly rates to put out top-quality legal documents which are precise. Can you imagine how frustrating it is to have non-lawyers putting legal language into my documents? They never do it right, and I wind up doing it myself. The only people using legal assistants these days must not know how to use computers. That's all I can think of. Either that, or they can justify gouging you with higher bills with all that overhead you'll see over there.
Back to the topic offices. Even the most basic office arrangement these days comes at a cost of at least $1,000 per month. This is another five hours at $200 an hour. Based on our two hours/day goal, you just saved another two and one-half days of waste. If you need a conference room for a deposition, take it at opposing counsel's office or call another attorney who will let you borrow his for a couple of hours.
Add to this your phone. If you are going to have a formal office, who here figures on a single phone line? "That's not what attorneys do. You need at least 2 phone lines - maybe 3." Yeah, right. What you need is a cell phone. How could it possibly be better for you or the client that you would have multiple phone numbers and have to check your messages at multiple places? Just give them your cell number and be done with it. This is your "office number."
By not having an office, you can also avoid having to pay for a business internet connection, in addition to the one you already have at home. Not only that, you might as well figure at least $100 per month in gas saved from not going back and forth from your home to an office. You just saved another $400 per month. This accounts for yet another billable day.
So, between the receptionist we did not hire, the office we did not rent, the phone lines and internet service we did not subscribe to, and the gas, this comes to nine and one-half days (out of the 21 working days per month) of your having to work to pay everyone else but yourself. Your odds of making $100k for yourself just vastly improved. Under the traditional myth, you would have spent almost half of all your earnings paying everyone but yourself. You would earn $50,000 a year…. and this is presuming you survived long enough to establish your business.
Many attorneys wonder whether they should buy malpractice insurance. This is a personal "comfort" decision. However, bear in mind these things: Young attorneys and new solos tend to be more eager, and this translates into "diligent." They are also more careful because they are scared. Cases in malpractice against new attorneys are rare. This also might have much to do with the fact that new attorneys do not tend to get cases where the stakes are high. There are not too many, if any, attorneys who will sue another attorney over a $5,000 or $10,000 mistake. Instead, they will tell their respective, aggrieved clients to go file a grievance. Malpractice insurance does not provide coverage against grievances.
What about software and websites? It is a good idea to get a cheap book-keeping software like Quicken or QuickBooks. There is a dirt-cheap legal billing software out of California going by the name, "RTGBills." It is easy to use and very adequate. We use it. As far as websites, they tend to fit into the "ego" category and are not likely to bring you any business whatsoever.
What about e-mail addresses? Are plain-old "gmail" addresses good enough? Sure. How about special phone numbers that you can forward to your cell phone? You can do this, but it is hard to see the point why you would. Either way, people are calling your cell. It is kind of like having a spam box in your Outlook program. I thought the idea of spam boxes was so that you did not have to see the spam. The idea lost its appeal once it became obvious that you need to check your spam box for possible non-spam which was trapped.
"Should I incorporate or form an LLC?" As regards incorporating, it is not worth it. You will not be shielded from personal liability for malpractice or any other tort you commit personally. In the early stages of your career, no creditor will make you a loan that you do not have to personally guarantee. Incorporating is one of those "ego" things. But if the filing fee does not bother you to throw away, then go ahead. You can do your own research as to choice of entity.
When I was forced to go solo, this is what I did. It was not because I was smart. It was because I was nearly broke and had student loans, a mortgage, a car payment, credit card debt and only $4,000 in my name! My parents were in no financial position to loan me money, either. It was up to me (though my wife was a new attorney getting her start taking court appointments for about $30k a year or so - she had her own big debts, too).
The bottom line is this: Sure, there are plenty who are reading this book, and at this point, would jump for joy to even make $50,000 per year and keep their "entitlement mentality" intact. As they say, you can lead a horse to water… Despite those who cannot let go of their counter-productive egos, there still remain plenty who will actually "get it." $50,000 is for UPS drivers and school teachers… not licensed attorneys.
© 2015, Jeff M