Your law firm business plan lays out what you want to accomplish, how you'll do it, and the people and expenses you'll need to achieve your goals.
Writing a business plan can feel overwhelming, with all the other pressures of starting your business. But it's importance cannot be stressed enough in business development for law firms Following a few key steps and exploring some law firm business plan examples will get the creative juices flowing to write your own.
There are over 439,000 law firms in the U.S. To start off right and stand out, you need to think strategically.
You already know how to practice law, but there's a whole other side to starting a law firm: the business aspect. Your law firm business plan is your roadmap for how you'll grow the firm and sustain the elements of operating your business.
A business plan serves multiple purposes when you're launching a new law firm. It:
For all these reasons, a business plan matters internally, but it may also be important externally if you're seeking outside funding to launch your law practice.
If you're turning to loans or other capital, a business plan shows investors or lenders that you're serious and have put in the time to discover how to get your law firm off on the right foot.
Whether you're planning to start a small firm right out of law school or grow into a big law firm with multiple lawyers, you need a business plan.
A good law firm business plan has multiple components, including:
Start with a table of contents for each one of these sections, then fill out each section with the details listed below.
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Your executive summary is a broad overview of some of the most important elements of the business plan. Writing this at the end can be easier, even though the finished product will go at the front of your completed business plan.
Your executive summary is designed to capture some critical details of your law firm business model you'll expound on later in the business plan.
Here's what belongs in your executive summary:
These might initially seem less business-focused than other aspects of your plan, like your market analysis or start-up budget but don't overlook them. There are plenty of law firms for clients to choose from today. Knowing what sets you apart from your competition will help you make key decisions, attract new clients, and learn what's most important as you grow and need to hire staff.
Without these guiding principles in your firm and business plan, you're more likely to make mistakes such as coming across as "just another local law firm."
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Your firm description explains the core aspects of business operations. In this section, write a summary that includes:
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A competitive analysis is one of the most compelling components of well-written business plans. The truth is that not all law firms are created equal, but as the founding attorney, it's your job to make sure that your prospective clients know that.
Doing your market research shows that you've been realistic about how you'll earn clients with competition in the local market. This can also open your eyes to new ways to reach the same clients, especially if other law firms rely on methods like referrals and word of mouth alone.
You need to know and document:
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In this section of your law firm business plan, you're naming the key stakeholders in this new law firm and what they bring to the table. This includes:
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Going through this exercise helps you see where you might have gaps in the day-to-day work of the law firm.
For example, you might not launch with full staff in place due to revenue concerns, but it's still worthwhile to document your intended first few hires. Handling all the responsibilities of running a law firm is a lot of work for anyone, so it's valuable to start thinking about delegation, even if you're not ready yet to hire someone.
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In the services section of your business plan, you'll mention your practice areas. Expand beyond this and brainstorm how your law firm will attract clients for these services.
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Here's what to think about as you write the services section of your law firm business plan:
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Your marketing plan is crucial to your law firm’s business plan. The phrase "build it and they will come" does not apply to starting your own law firm. You must have a rock-solid plan for finding and converting new clients.
You need a marketing strategy that aligns with your practice area and the needs of your ideal clients.
There are four big questions to use as you write your law firm marketing plan:
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Within your marketing plan section, you will also need:
Consider marketing options like social media, business development, SEO, and PPC advertising.
Your marketing plan will vary based on whether or not the firm is new or you have an existing book of business. Launching a new law firm takes a lot of upfront work and marketing, so be prepared to account for this work in your marketing plan. You can mix creative ideas for law firm marketing with tried and true ways to get your name out there.
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If you want to grow your law firm and earn a consistent paycheck for yourself, you need a financial plan for your law firm. Although you might not have answers to every question relating to law firm finances, try to be as detailed as possible. Aim to set up a financial plan for at least the first year in business.
Here are some good numbers to establish in this portion of your business plan:
This aspect of your firm’s business plan does not need to be perfect. You'll adapt it over time, especially after you've been in business for a year or more. Try to come up with reasonable estimates in this portion to be realistic during your first year.
If you're starting your own law firm and won't have any new hires in the foreseeable future, a sound financial plan helps you decide when you have enough cash flow to commit to getting help with admin or paralegal work.
Return to your financial plan as your law firm evolves, looking at things like your profit and loss balance sheet, cash flow, and profit margin. Adjust your efforts and pricing based on the data you collect.
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A new firm should always include a start-up budget in its business plan and the sources of funding that support this budget. While an established firm probably has some of these expenses covered already, a new firm has to consider both the first-year financial expenditures of running the business and a separate set of costs just to get things up and launched.
Your start-up budget should account for:
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If you’re just getting started with your new business plan, take a look at the example that we put together. If you’d like to download a blank version of our template so that you can use it as the base for your own, on the button below. Make sure to customize your plan to your needs and goals.
Download your copy of our law firm business plan template here:
Your law firm business plan is vital to understand what you hope to accomplish, how you'll set goals and recognize when you've achieved them, and to decide the core aspects of how your law firm will function. As a roadmap, it helps you break down the big tasks associated with starting a law firm into meaningful action steps.
There's plenty to think about if you're just starting with a new law firm. It might seem overwhelming to approach these tasks entirely on your own. One of the best ways to attract new clients when you launch is to invest in a solid SEO strategy. This helps you earn qualified leads from traffic to your website. Rankings.io knows what it takes to get results with law firm SEO, and we've built a reputation doing just that. Contact us today to learn more about how SEO can get you marketing wins in your law firm.
