Starting your own practice is both exciting and scary. You envision all the things you want to do, achieve, and create, but at the same time the road to getting there feels uncertain.
That is why today we want to show you a simpler, more cost-effective way to start your law firm: Amata’s full-service law firm programs.
The 2 Biggest Costs Law Firms Incur
Achieving profitability is a constant balancing act between increasing revenue and decreasing expenses. In the beginning, when you probably have only a handful of clients, you want to keep a close look at expenses. This is what creates the positive cash flow to invest in team and infrastructure, so you can grow your business.
At Amata we have served attorneys for more than 21 years. That is why we designed unique solutions to reduce your two biggest expenses: Hiring and office space.
According to the 2020 Report on the State of the Legal Market by Thomson Reuters and Georgetown University’s Center on Ethics and the Legal Profession, law firms’ biggest expenses are:
- Personnel Costs: This includes salaries, benefits, and bonuses for lawyers, paralegals, administrative staff, and other professionals. They typically represent the largest expense for law firms, accounting for around 55% to 60% of total expenses.
- Office Space: Rent or mortgage payments for office space can be substantial, especially in prime locations. Additionally, expenses related to utilities, maintenance, and insurance also contribute to office costs. Office space and related occupancy costs account for approximately 10% to 15% of total expenses.
- Technology Infrastructure: Law firms invest heavily in technology for case management, document storage, billing, and communication. This includes software licenses, hardware purchases, IT support, and cybersecurity measures.
- Marketing and Business Development: Law firms often allocate significant funds to marketing and business development efforts to attract new clients and retain existing ones. This may include advertising, website development, networking events, and sponsorships.
- Professional Development and Training: Continuing education and professional development are essential for lawyers to stay updated on legal developments and maintain their expertise. Law firms may incur expenses for training programs, seminars, conferences, and certifications.
- Litigation Costs: For firms engaged in litigation, expenses such as court fees, expert witness fees, deposition transcripts, and travel costs can be substantial.
- Insurance: Professional liability insurance is a significant expense for law firms to protect against malpractice claims. Additionally, firms may purchase other types of insurance coverage such as general liability and cyber liability insurance.
- Administrative Expenses: This includes costs associated with office supplies, postage, printing, and other day-to-day operational expenses.
As you can see, personnel costs and office space can account for up to 70%-80% of a law firm’s expenses. If you can reduce costs on these two items, you give yourself a massive advantage over every other competitor in your market.
How Amata Saves You On Personnel and Office Expenses
Our full-service law firm programs are designed to do three things:
- Give you access to everything you need to grow your law firm, including paralegals, virtual assistants, administrative staff, conference rooms, and more.
Whether you’re running a virtual or physical office, Amata provides on-demand (hourly) support services in the form of admin assistants, paralegals, receptionists, and business phone/phone app services that help you cross tasks off your to-do lists and get back to growing your business.
- Grow in a flexible way that adjusts to the ups and downs of the market. For example, if an associate suddenly leaves, you can drop office space without penalties. Or if you see a surge in clients and need new offices, you can also add them without rigid lease terms that impede it.
Amata provides 12-month lease terms with a 30-day notice to adjust office space. This allows you to reduce costs and maintain profitability when you need it most.
- Build a team you can delegate to, so you and your associates can focus on billable hours and enjoying a healthy work-life balance.
When revenue goes down, you need to reduce expenses to maintain profit. Amata provides flexibility to achieve this in your office space and personnel costs.
Fractional Support Services
Our newest package allows you to hire pre-vetted talent at just the hours that you need. There are five pre-made packages, plus a pay-as-you-need-it option:
Program Benefits
- Save 60% compared to a full-time employee
- Take mundane tasks off your daily to-do list
- Spend more time working with your clients
- Work with a team to support your practice, not just one or two employees
- No more time or money spent recruiting
- Zero employee benefits costs
- Scale team up for busy periods, scale down when done
- No more payroll to cover during slow periods
- Get expertise to help organize your days and reduce the anxiety created when you feel under pressure
- Make more client deadlines without sacrificing work/life balance
- Make time to take on more clients
To learn more about our program, contact our team here. Our programs allow you to hire support staff and access premium offices at flexible rates. We are ready to support your new law firm and see you thrive!
