From defining your vision to setting realistic goals, a business plan will help you clarify your objectives and map out the steps needed to achieve them. It will also assist you in identifying potential challenges and strategizing ways to overcome them. By laying out your vision, financial projections, marketing strategies and operational plans, you create a guide to help you remain focused and proactive in your journey.
A well-crafted business plan is not only a tool for your personal use but also a valuable document to present to potential partners and financial institutions. It demonstrates your commitment and preparedness, and the viability of your firm, thereby instilling confidence in those who may support your endeavours.
If you believe that sole or small firm practice is the right choice, then you need to decide what your business will look like and develop a plan to build it.
First, consider the type of firm you want to run. Consider:
- Where will your firm be located? What geographic area will you be serving?
- Do you intend to run a general practice or primarily practice in a specific area?
- If you plan to practice in more than one area, are your practice areas compatible?
Your practice area and the legal services you plan to offer will drive many of the other decisions you make when starting a new law firm. For example, cash flow management will be much different for a real estate practice, with a relatively high volume of files that conclude quickly, as compared to a contingency-based personal injury firm, where you will not begin recovering fees until files settle, potentially years down the road.
As another example, a family law firm may want to be situated near the courthouse to reduce travel time for court appearances, whereas an estate-planning practice could be located in a residential area closer to clients. Or a commercial litigation firm may need to focus its IT budget on legal research and document management tools, while a business law firm may want to initially focus its spend on building a precedent library.
After considering your practice area(s), envision the type of firm you want to operate – now and in the future. You don’t want to lock yourself into a situation that will hamper your options down the road. Ask yourself:
- Is this a temporary solution to a current situation?
- Will you function best as a true solo with no support staff? Or would you benefit from a less solitary office with someone to assist you from the first day?
- Do you plan to remain a sole practitioner? Or are you hoping to grow your firm over time to include support staff and, perhaps, other lawyers?
- Do you eventually hope to join another existing practice?
- Do you plan to do any contract work for another firm or third party?
- Are you an innovator, dreaming of revolutionizing the practice of law?
Next, think about the clients you want to attract and how you will find them. Identifying your ideal client is like spotting a zebra in the savannah: knowing what qualities to look for helps them stand out. Ask yourself:
- Who are your ideal clients?
- How can you serve them?
- Where will you find them?
- Where will they find you?
Finally consider accessibility. In certain practice areas, such as personal injury, elder law or disability law, you may be working for clients with mobility issues or other disabilities. You may also work with other lawyers or staff who have limited mobility, or other disabilities such as sight or hearing impairments. However, lawyers in all practice areas serve clients and work with people from many different backgrounds, with many different needs. Ultimately, you don’t want your firm to be a barrier to your clients, your staff or anyone else.