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How to Protect Your Practice in a Recession

published December 30, 2008

By CEO and Founder - BCG Attorney Search left
Published By
( 8 votes, average: 4.1 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.
Berson's ten tips are as follows:
 
  1. Cash Flow


    Honestly evaluate your balance sheet. By drafting a worst-case scenario over a twelve-month period, and identifying changes which could be made, you could prepare your business for the worst. Also put aside money while you still have it to provide protection.
     
  2. Credit

    Because good credit is so important now, consider extending your line of credit before your worst-case scenario occurs, should it occur at all. Berson points out it is ''better to approach a lender with a positive financial forecast than when your balance sheet reflects a recession.''
     
  3. Accounts Receivable

    Pay attention to the debts clients owe. Before allowing an amount to increase significantly, speak with the client. This would be better than allowing the debt to increase and then end up with no compensation at all.

    Another option to managing tight cash flow is to negotiate with suppliers and service providers. If dealt with ahead of time, debts you owe them may be paid on a 45-day schedule instead of a 30-day schedule. This is far better than paying late and having poor relations develop.
     
  4. Spending

    Don't think too small here. What will really matter are cuts in travel costs, ensuring you have no duplicated duties in administration, and having a staff that meets your needs efficiently.
     
  5. Research

    Find out how a recession will impact clients. As necessary, cut needless services, add new ones, and expand old ones with new features and specialties.
     
  6. Go Where the Work Is

    If you have a specialty area that is booming somewhere else and is receding where you are, then go where the work is available. Expand as necessary. Being adaptable and flexible will ensure your future in the business.
     
  7. Pricing

    Smaller firms will receive more notice as they are able to offer the same services as larger firms, but at lower rates. Most firms raise rates 8% each year without increasing services. Clients may not appreciate this in the current economic climate.
     
  8. Loyalty

    Keeping old clients costs less than getting new ones. Maintain competitive pricing and excellent service. Let your clients know you appreciate and value them.
     
  9. Market

    Analyze what skills and services set your business apart from others and market those skills. Consider taking old skills and services and ''repackaging'' them to fit current needs.
     
  10. Schedule

    Maintain an even work schedule even if billable work is scarce. Keep a good attitude and get involved in pro bono work, if necessary, to build and retain skills. Look for billable work even if it may not be exciting. Remain active in firm activities.

By following these ten tips, any business should be able to stay strong throughout difficult times. Do not get discouraged. Stay active and involved, while exercising smart business practices.

Alternative Summary

Harrison is the founder of BCG Attorney Search and several companies in the legal employment space that collectively gets thousands of attorneys jobs each year. Harrison’s writings about attorney careers and placement attract millions of reads each year. Harrison is widely considered the most successful recruiter in the United States and personally places multiple attorneys most weeks. His articles on legal search and placement are read by attorneys, law students and others millions of times per year.

More about Harrison

About LawCrossing

LawCrossing has received tens of thousands of attorneys jobs and has been the leading legal job board in the United States for almost two decades. LawCrossing helps attorneys dramatically improve their careers by locating every legal job opening in the market. Unlike other job sites, LawCrossing consolidates every job in the legal market and posts jobs regardless of whether or not an employer is paying. LawCrossing takes your legal career seriously and understands the legal profession. For more information, please visit www.LawCrossing.com.

published December 30, 2008

By CEO and Founder - BCG Attorney Search left
( 8 votes, average: 4.1 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.