How To Fix Your Struggling Solo Law Firm?

What's Going On With Solo Law Firms?

Recently, I was in the market to hire a law firm to handle business for our company. Firstly, I'm married to an attorney, have friends who practice, have lawyers in the family, partnered with an attorney in a brokerage, and spent years professionally marketing for an immigration firm.

That said and to put this article in context, I'm familiar with the legal industry.

Why Hire An Attorney Outside Of My Family?

The solicitation of new investors, new opportunities, and the potential growth of our company is my priority as a Co-Founder. To protect this interest, I needed work to be handled by a professional outside of the family.

Why?

Firstly, my wife did not specialize in the area our company needed. Plus, our company looked to secure the right paperwork beyond the standard contract templates offered in PandaDocs, Legal Contracts.com, etc.

This was my thought.

So, hiring a Solo Practicing Law Firm would be pretty easy, right?

Wrong!

Here's the story that inspired this article.

We Track Everything

In full disclosure, our company, Think Grids, is a technology-stacking, eLearning development company. In short, we help companies connect digital solutions, by providing the right content, to the right audience, at the right time.

A fancy way of saying...We push brands and drive revenue through curated content.

To accomplish this, we track every digital aspect of business.

And, yep! Tracking phone calls and emails is no exception.

In trying to hire an attorney, here’s what we discovered...

What We Discovered

Spoiler Alert!

Woefully, many phone calls were not returned, and emails were not even opened.

I live in Texas and we have a high number of attorneys per capita compared to other states. With so much competition, you would think that a solo attorney would be quick to return a message or email.

Not so much.

This prompted me to do a little research and what I found was SAD.

Note: Beyond my personal experience and difficulty in hiring someone to do the work, I did the research to validate my recommendations to Solo Law Firm Practitioners.

ABA and Clio Legal Trends Report

So, what does the research show? According to the ABA, 36% of all attorneys say they are very successful. This seemed to contradict my experience in trying to "give" money away.

This contradiction started to make sense when I discovered Clio.com.

Clio is a Cloud-based Legal Management Technology Company.

*Ok, you know I had to go there. After all, I’m a Co-founder of a tech firm. Besides, why not go to a company that continuously collects data on law firms in their system, from the competition, and the legal industry as a whole?

The Vicious Cycle of Less

According to the Clio (2021) Legal Trends Report, Solo practitioners have had a harder time weathering the initial economic impacts of the COVID-19 pandemic than others (bigger firms).

The effect is a steep revenue decline and drops in new casework.

Based on my experience, I surmise the following:

• ?Less revenue has cascaded into less support.
• ?Less support reduces the capacity of new cases Solo Law Firms can handle
• Less casework equals potentially less revenue
• Less revenue equals lower/no advertising budget to compete against big firms in TV, Radio, and Billboard marketing

The Less and Less Scenario is a vicious cycle that can lead to the failure/closing of many Solo Law Firms.

Why 92% of Law Firms Fail and Rescinding Offers

Based on the report, we know the pandemic affected the legal industry, solo law firms in particular. That’s not the complete picture. According to Law Coaching.com, 92% of Law Firms were failing. This was before the pandemic.

Consequently, there’s another problem for new law graduates (who pass the bar).

Additionally, the Bloomberg article, Pandemic Clobbers Job Starts for Law Graduates, notes that a significant number of 2020 law school graduates had job offers withdrawn or delayed due to fallout from the COVID-19 pandemic.

Highlights and Solution

The Clio Report also highlights a similar trend among solos who have used electronic payments, client portals, client intake tools, and customer relationship management solutions. $52,507 more revenue than other solos. On a percentage basis, solo practitioners using those technologies generated up to 58% more revenue and 50% more casework than solos not utilizing tech.

The answer seems pretty clear: Embrace Technology

My 2024 Strategy Recommendations

Firstly, before you can market anything, hire a technology-stacking company that understands the challenging AI-driven business landscape. Moreover, a company that can put together the right strategy where automation is key. Additionally, because of the financial challenges many firms are still experiencing from the pandemic fallout, a solution that covers these 4 lever areas of a practice/business is recommended for 2024:

• Internal Operations - What can you reduce, eliminate, or delegate? Answering these questions can help you save money and time. Hint: AI and Automation tools will help!
• Web Presence (e.g., website and reputation management) - What can you do at little or no cost to get traffic (potential clients) to your website? How can you grow your brand as the go-to attorney that's trusted in your area of practice?
• Social Media Presence - How can you leverage short-form content to have clients come to you rather than you chasing them?
• Automate Redundant Tasks - How can you use AI and automation tools to streamline mundane tasks? A great example is using AI to chat with potential clients and book them on your calendar.

Hopefully, this strategy will make your solo practice a profitable one in 2024.