No matter what anyone says, there is plenty of law business out there. The real question, the one that separates the successes from the strugglers, is knowing and getting GOOD business. Oh, and staying away from BAD business. That’s all a law practice is, really. Hearing a person’s story, and making a business decision on whether they and their story are profitable business.
Here’s a list of the reasons bad business is so bad:
1. All time spent on bad business takes away from two things: good business and personal time. You can make up for bad business with good business, but only if you expand into personal time. Very unhealthy.
2. It saps your energy. Squeaky wheels get your grease, and that is the essence of bad business. Squeaking clients, making a noise you can’t escape and have to attend to. So you grease it, and talk to it, and e-mail and fax it. Still, it squeaks. You grease it enough, it starts to move along, nice and quiet. Eventually, you and the squeak get to your destination, the case ends, and then you realize the third reason.
3. You lose money. Putting aside clients who get quiet, and then slink away without paying, that’s bad enough. All that squeaking, all that time, your time, and in the end you made $10 an hour. It happens, and if you don’t pay attention, it happens a lot.
4. Bad karma. When you are a solo lawyer, your clients and their cases are your life. When you have a lot of cases, you always have a certain “mix”. I first realized this one afternoon at 4 o’clock, while talking to one of my lawyer friends, another solo. It was a typical “can you top this” of problems, commiserating in our misery, when he asked, “Why are you so down today?”, and without hesitating I answered “Bad mix right now”. He knew just what I meant and said, “Yeah, that’s a bad thing” Since then, we always start our afternoon calls with “How’s the mix?”
5. A bad mix, that you don't fix, makes you hate your practice. And if your practice is YOU, well, you know where this leads.
I have blogged previously about general practice vs. specializing. We are all bound to dabble in certain areas of law. Once you do more than a few of something, either really do it, or STOP. Here is my short list of bad kinds of cases, and the reasons they are bad:
a. Real estate closings: fixed fees with no control over your time; clients who are generally not business people, suddenly under pressure and needing you. (see previous blogs entitled "Perils of Real Estate)
b. Accident cases with minor injuries: You end up working your tail off for years, spending your own money, and the insurance company fights you every step of the way. Now, it is true that every so often you hit a home run with an accident case. But sometimes there are no home runs in the mix, just some very squeaky wheels.
c. Landlord-tenant cases: Unless you do a lot of them, so it would make sense to hang around in Housing Court all day. Hanging around in Housing Court all day on one case, is bad business.
d. Debt collection cases: a percentage of nothing is nothing. Never forget this. Yeah, you can collect once in awhile, but on all the ones where you get nothing, you never get back your time.
e. Purchase and sale of a small business: Unless you are really tough, and a super smart businessman, and ruthless, and heartless. As a young attorney, you find out right away, that compared to other small business owners, you are a wimp. A nothing. You may be able to do the papers for the deal, but you don’t even know what the deals are really about. I’m not talking about corporate mergers here. I’m talking about representing someone buying a coffee shop. If you really knew the coffee shop biz, and all the details of what went on, maybe you could effectively represent someone buying or selling a coffee shop. The problem is, if you knew that, you’d be IN the business, not “doing the papers”.
It is really easy to market for, and get, bad business. Place an ad in the yellow pages, pay to be on lawyer internet sites, do speaking engagements in the community, join organizations. These things all work, you will get business, lots and lots of bad business.
Of course, if you get enough bad business, bad becomes good, you become the specialist, and you are the bad business go-to person.
Bottom line: bad is bad, bad can become good, if you don't know bad when you are in it, bad is VERY bad. If you can figure out what good is, skip all this bad stuff, and go for good from the git-go. Get me?