From Panic to Profit: 3 Hidden Strategies Fast Growing Firms Use to Increase Profit
Do you want to create a more successful law firm, where you are able to take home more money? In this episode of the Maximum Lawyer Podcast, speaker Brooke Lively shares her personal experience of firing her biggest client and the resulting financial struggles for her business.
Starting from scratch and building a successful business is a hard thing to achieve. Brooke talks about using the rule of thirds strategy to make her company a profitable one. The strategy involves the following: allocating a third of your revenue to paying salaries, a third to overhead and a third to profit.
1 | Salaries
When it comes to paying employees, it is best to design compensation packages that work for your firm.
Accountability within a law firm is so important. It moves work through a firm and can be used to dictate pay. One way to hold people accountable is helping them to create goals. Discussing goals will help employees understand what they want to accomplish. As an owner of a law firm, it is important to dedicate time with each employee on a weekly basis to speak through goals so that everyone is on track.
2 | Overhead
A lot of firms spend way too much money on marketing. Brooke speaks to how cutting the marketing budget is a great way to save money. One way to do this is to analyze the return on investment on all marketing channels for a firm each month. Whichever is the lowest that month is cut, which can save tens of thousands of dollars. Another way to save money is to review the monthly credit card bill to see what expenses have been neglected and therefore removed.
3 | Profit
As a firm owner, there are many things you can do for your profit. One thing is to monitor it every month, tracking the increase or decrease of profit. Another thing is to figure out your salary, distributions and personal finances monthly to make sure you are not only making what you deserve but are paying off your expenses.
Listen in to learn how to make your law firm more profitable!
2:58 The rule of thirds
6:27 The importance of accountability in law firms.
10:51 Your digital marketing budget
11:35 Exploration of the expenses and benefits of coaching
16:28 The importance of properly compensating law firm owners.
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