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Building a Mid-Sized Firm and Going Out on My Own

by Alexa Drago on October 17, 2016

By Guest Blogger: Christine Swenson

Note from the Editor: This post is a recapon the latest Colorado CLE Small Firms Big Success Presentation on Oct 10, Building a Mid-Sized Firm and Going Out on My Own.

simple-elegant-home-office-designFor entrepreneurs, Simon Sinek’s “Start with Why” is one of the most powerful concepts in business today. If you aren’t familiar with “Start with Why,” then frankly, you need to start there! Rather than focus on the external product or service being produced, Sinek encourages everyone to begin with one’s own internal motivation. I found Sinek’s concept was subtly woven throughout Samera Habib’s presentation, Building a Mid-Sized Firm and Going Out on my Own – Lessons Learned, to the Small/Solo Section on Monday. In light of her presentation and handouts, I found the following as my biggest take-aways:

  • Why do you want to open your own firm? Small business comprises a significant part of the American economy but that doesn’t mean entrepreneurship is for everyone. Ms. Habib raised some important questions any lawyer should ask herself before starting her own firm. Most importantly, you need to consider your personality and the reasons you went to law school. If you truly love the law, research, writing, and arguing in court, then business ownership may not be for you. However, if you enjoy that work but can multi-task, mentor employees, plan, develop, and market yourself in addition to providing excellent client services, then owning your own firm may be for you.
  • Why are you choosing that business entity? Now that you’ve completed your own personal SWOT analysis (strengths, weaknesses, opportunities, threats – another business tool to maintain objectivity and focused), it’s time to form your business. Certainly, you can default to an LLC but is that appropriate for you and your long-term goals? Maybe the tax advantages of a S Corporation would suit you better. In this situation, Ms. Habib pointed out that there is no one right answer but there is much value in doing the research and talking with a CPA or tax attorney before filing the documents to form your own business.
  • Maximizing technology reduces costs but not at the expense of customer service. Thanks to the cloud, ultra-laptops, tablets, turning our cell phones into secure wi-fi, and more, we can work from anywhere. Also, with most software now being sold as downloaded license subscriptions rather than CDs/DVDs to be installed on individual hard drives, a business’ footprint has been reduced dramatically. Practice management systems, such as Amicus, Clio or ProLaw, minimize, if not eliminate the need for an in-office server, local area networks, and the maintenance that goes with them. But, Ms. Habib cautions, before subscribing with any service, investigate its features so that it can save you time, enhance the services you deliver, and, generate income for you. While most systems boast of your ability to add customized fields or automate document production (think mail merge), what good is it if you can’t search for the data you input in those customized fields, or if you don’t know how to use document automation effectively or worse, you don’t understand why document automation can help you? As a result, after having changed systems twice, I am looking to change again at the end of the year. It’s not an enjoyable process but I’ve simply outgrown the software’s capabilities. When it’s your turn, evaluate whether and how a practice management system can grow with you, whether and what other programs can be integrated with it, and how (and why) you can fully utilize its features to streamline, if not automate your firm’s processes.
  • The true cost of adding an employee. When it is time to expand and bring employees on board, it is important to identify and plan for the added costs involved. Of course, there is the employee’s salary. In addition, you have to pay taxes on that employee. You may offer benefits, such as healthcare, life insurance, or a retirement plan, which are paid in addition to their salaries. Also, as the business owner, adding an employee may require you to buy additional types of insurance or cause an insurance premium to increase. In my experience, a new employee costs between 1.2 and 1.5 times the employee’s salary, but your goal is not just to cover the cost of your employee but for your firm to make a profit from your employee. As a result, unless that employee can generate a profit for you, say 2 times his salary, then you will want to reconsider a traditional employer-employee relationship. Instead, consider contract employees or outsourcing a specific role to another company that specializes in that, such as a receptionist. Continuing with the receptionist example, years ago, these companies were called answering services. Today, they are virtual receptionists. I found Ms. Habib’s commentary on third-party answering services an insightful one. She pointed out that, no matter how well educated they are about you and your business, they could stand between you and your next paycheck. It’s important to remain objective and strategic when evaluating whether or not to add outside service provider to enhance your company’s delivery of services.

Ms. Habib’s presentation and supporting materials touched on a wide range of topics, which was good for the lawyer toying with the idea of hanging his own shingle. It gave the audience a lot to think about, which is never a bad thing. Business ownership can be exciting and challenging for the right personality types. If you aren’t suited to be a business owner or entrepreneur, that’s fine too. It’s better to find out early in the process.

 

christine-2016-headshot-close-upChristine Swenson, President & CEO of Swenson Law Office, PC, has more than 20 years’ legal experience and exclusively practices immigration law helping all non-US citizens live, work, and play in the US. Her firm’s mission is to provide sound immigration legal counsel that’s best for your needs and follows the law. In other words, she and her team help you realize your immigration dreams. Give her a call at 720.414.2027 or visit her website.

 

 

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