{"id":129104,"date":"2025-07-30T22:07:00","date_gmt":"2025-07-31T06:07:00","guid":{"rendered":"https:\/\/xira.com\/p\/2025\/07\/30\/law-firm-profits-5-ways-you-may-be-sabotaging-your-firms-growth\/"},"modified":"2025-07-30T22:07:00","modified_gmt":"2025-07-31T06:07:00","slug":"law-firm-profits-5-ways-you-may-be-sabotaging-your-firms-growth","status":"publish","type":"post","link":"https:\/\/xira.com\/p\/2025\/07\/30\/law-firm-profits-5-ways-you-may-be-sabotaging-your-firms-growth\/","title":{"rendered":"Law Firm Profits: 5 Ways You May Be Sabotaging Your Firm\u2019s Growth"},"content":{"rendered":"<p>Today\u2019s lawyer-entrepreneurs want to move fast\u2014and they&#8217;re frustrated, says Brooke Lively. Focus on these five things to keep your growth from stalling.<br \/>\nThe post Law Firm Profits: 5 Ways You May Be Sabotaging Your Firm\u2019s Growth appeared first on Articles, Tips and Tech for Law Firms and Lawyers.<\/p>\n<p>Not growing fast enough? Here are five common things that can slow your practice\u2019s growth and stall law firm profits.<\/p>\n<div class=\"wp-block-group cust-audio-set\">\n<div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<div class=\"exemag-video-wrapper\"><iframe loading=\"lazy\" width=\"100%\" height=\"180\" frameborder=\"no\" src=\"blank\" data-rocket-lazyload=\"fitvidscompatible\" data-lazy-src=\"https:\/\/share.transistor.fm\/e\/483a8d08\">[embedded content]<\/iframe><iframe loading=\"lazy\" width=\"100%\" height=\"180\" frameborder=\"no\" src=\"https:\/\/share.transistor.fm\/e\/483a8d08\">[embedded content]<\/iframe><\/div>\n<\/div>\n<\/div>\n<div class=\"wp-block-yoast-seo-table-of-contents yoast-table-of-contents\">\n<h2>Table of contents<\/h2>\n<ul>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-the-new-law-firm-owner\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">The New Law Firm Owner<\/a><\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-five-things-that-sabotage-law-firm-growth\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">Five Things That Sabotage Law Firm Growth<\/a><\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-1-nbsp-the-theory-of-jit-cash\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">1.\u00a0The Theory of \u201cJIT\u201d Cash<\/a>\n<ul>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-you-must-closely-monitor-your-cash\" data-level=\"3\" rel=\"nofollow noopener\" target=\"_blank\">You must closely monitor your cash.<\/a><\/li>\n<\/ul>\n<\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-2-nbsp-no-specific-plans-for-growth\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">2.\u00a0No Specific Plans for Growth<\/a>\n<ul>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-to-get-more-you-have-to-plan-for-more\" data-level=\"3\" rel=\"nofollow noopener\" target=\"_blank\">To get more, you have to plan for more.<\/a><\/li>\n<\/ul>\n<\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-3-nbsp-random-unmonitored-marketing\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">3.\u00a0Random, Unmonitored Marketing<\/a>\n<ul>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-to-turn-a-profit-you-must-have-a-specific-marketing-plan-and-budget\" data-level=\"3\" rel=\"nofollow noopener\" target=\"_blank\">To turn a profit, you must have a specific marketing plan and budget.<\/a><\/li>\n<\/ul>\n<\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-4-failure-to-plan-for-capacity\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">4. Failure to Plan for Capacity<\/a><\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-5-no-mechanism-to-course-correct\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">5. No Mechanism to Course Correct<\/a>\n<ul>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-create-a-feedback-loop-for-projects-and-everyday-business-operations\" data-level=\"3\" rel=\"nofollow noopener\" target=\"_blank\">Create a feedback loop for projects and everyday business operations.<\/a><\/li>\n<\/ul>\n<\/li>\n<li><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-profit\/#h-accelerating-your-law-firm-profits\" data-level=\"2\" rel=\"nofollow noopener\" target=\"_blank\">Accelerating Your Law Firm Profits<\/a><\/li>\n<\/ul>\n<\/div>\n<h2 class=\"wp-block-heading\" id=\"h-the-new-law-firm-owner\">The New Law Firm Owner<\/h2>\n<p>Lately, I\u2019ve been meeting a new breed of attorney. They see their firms more as a means to an end than the end itself. Their goals are expansive; they start their firms younger than their parents might have, and their expectations are significantly higher. They are entrepreneurs.<\/p>\n<p>This leads to some problems. These lawyers are easily frustrated when the firm doesn\u2019t grow at the expected pace. They\u2019re frustrated because they are not achieving their financial and growth goals. Many are barely making a living. And they feel demoralized if they believe they\u2019re lagging behind their law school classmates. <\/p>\n<h2 class=\"wp-block-heading\" id=\"h-five-things-that-sabotage-law-firm-growth\">Five Things That Sabotage Law Firm Growth<\/h2>\n<p>When attorneys ask for strategic financial advice on improving their law firm profits, we invariably look at these five things that slow firm growth.<\/p>\n<h2 class=\"wp-block-heading\" id=\"h-1-nbsp-the-theory-of-jit-cash\">1.\u00a0The Theory of \u201cJIT\u201d Cash<\/h2>\n<p>Cash is the air that any business needs to survive.\u00a0Without it, no firm can function for more than a couple of weeks, much less grow. Like a lot of business owners, my father had a theory about <a href=\"https:\/\/corporatefinanceinstitute.com\/resources\/accounting\/just-in-time-jit-method\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">JIT<\/a> cash \u2014 cash will always show up \u201cjust in time.\u201d For a lot of firms that isn\u2019t always true.<\/p>\n<h3 class=\"wp-block-heading\" id=\"h-you-must-closely-monitor-your-cash\">You must closely monitor your cash. <\/h3>\n<p>How much cash do you have now, and how much will you have at the end of every week for the next six to eight weeks? This is called a cash flow forecast. It tells you what\u2019s coming in and what\u2019s going out week to week. Until you have a reliable balance of three (or more) months of operating cash in the bank, your bookkeeper needs to prepare this forecast every week \u2014 <em>and you need to look at it.<\/em> <\/p>\n<p>In addition, every business needs a line of credit. Banks only like to give them to people who don\u2019t need them, so apply when you don\u2019t need one. And every time you have a good year, make sure you apply to have it increased. <\/p>\n<p><em>Related: <a href=\"https:\/\/www.attorneyatwork.com\/7-words-to-learn-before-you-apply-for-your-next-loan\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">\u201cSeven Words to Know Before You Ask for a Loan.\u201d<\/a><\/em><\/p>\n<h2 class=\"wp-block-heading\" id=\"h-2-nbsp-no-specific-plans-for-growth\">2.\u00a0No Specific Plans for Growth<\/h2>\n<p>Many business owners seem to think their businesses will grow simply because they declare they want them to grow. And they might. At a whopping 5% to 7% per year.\u00a0But the entrepreneurs I meet want something more in terms of law firm profits. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-to-get-more-you-have-to-plan-for-more\">To get more, you have to<em> plan<\/em> for more. <\/h3>\n<p>What is your BHAG (Big Hairy Audacious Goal)? Where are you going to be in 10 years? Three years? At the end of this year? To get there, you need to make it so real you can touch it, feel it, smell it, taste it and see it. You need to write down your goals and make them SMART:<\/p>\n<ul class=\"wp-block-list\">\n<li><strong>S<\/strong>pecific<\/li>\n<li><strong>M<\/strong>easurable<\/li>\n<li><strong>A<\/strong>chievable<\/li>\n<li><strong>R<\/strong>elevant<\/li>\n<li><strong>T<\/strong>ime-bound<\/li>\n<\/ul>\n<h2 class=\"wp-block-heading\" id=\"h-3-nbsp-random-unmonitored-marketing\">3.\u00a0Random, Unmonitored Marketing<\/h2>\n<p>I can\u2019t tell you how many firms I have seen do what we call \u201cRandom Acts of Marketing.\u201d They \u201ctry something out\u201d with no plan, no goal and no idea what will happen or how many clients will come from it. They do no tracking or measuring, so there\u2019s no way to tell if something succeeds or not. These firms are throwing away good money. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-to-turn-a-profit-you-must-have-a-specific-marketing-plan-and-budget\">To turn a profit, you must have a specific marketing plan and budget.<\/h3>\n<p>Spend on activities that have a specific expected return and measure their actual return on investment to evaluate their effectiveness. How else will you know where to put your money?<\/p>\n<h2 class=\"wp-block-heading\" id=\"h-4-failure-to-plan-for-capacity\">4. Failure to Plan for Capacity<\/h2>\n<p>I\u2019ve watched so many lawyers market intensely, get a bunch of cases and spend so much time working those cases, they have no time for marketing. With no new cases in the pipeline, they start marketing <em>again<\/em> \u2014 and the cycle repeats itself.<\/p>\n<p>As your firm grows, it can be harder to see what\u2019s happening \u2014 it takes a slightly different form than when you were smaller. How it looks is work stacks up, people get overloaded, you hire somebody new, the workload drops, and then it starts to pile up again. You lose people (firms often lose good employees during the overload period), you hire more people, and the cycle continues. <\/p>\n<p>It\u2019s a capacity problem, and until you solve it, it will be impossible to sustain real growth.<\/p>\n<ul class=\"wp-block-list\">\n<li>You must understand the capacity of each person or team. <\/li>\n<li>You must know how long each case takes and how much work it requires, in detail. <\/li>\n<li>And you must know what\u2019s in the pipeline \u2014 how much work your marketing will generate \u2014 so you can plan for the future.\u00a0<\/li>\n<\/ul>\n<p>Once you know this, you can look three, six, or even nine months into the future and staff up or down <em>ahead<\/em> of the curve.\u00a0<\/p>\n<p>Wouldn\u2019t it be nice to know that cases won\u2019t stall because you are over capacity? To increase your law firm\u2019s profits, you must have trained people ready to work when you need them.<\/p>\n<p><a href=\"https:\/\/www.attorneyatwork.com\/law-firm-cost-of-employee-turnover\/\" rel=\"nofollow noopener\" target=\"_blank\"><em>Related: The High Cost of Turnover: Your Employees Cost Too Much to Lose<\/em><\/a><\/p>\n<h2 class=\"wp-block-heading\" id=\"h-5-no-mechanism-to-course-correct\">5. No Mechanism to Course Correct<\/h2>\n<p>As entrepreneurs, we are all moving quickly and are often off to the next thing before the last one is finished. I get it.\u00a0However, it\u2019s imperative that you <em>stop<\/em> to look at what\u2019s working and not, and figure out the underlying reasons for both. Once you find those reasons, you can fix what is broken and make sure you repeat whatever brought you the best results \u2014 and do so every single month. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-create-a-feedback-loop-for-projects-and-everyday-business-operations\">Create a feedback loop for projects and everyday business operations. <\/h3>\n<p>Using a scorecard or dashboard that allows you to quickly see what is on track and what is off track will allow you and your firm to make the changes that impact your bottom line.<\/p>\n<h2 class=\"wp-block-heading\" id=\"h-accelerating-your-law-firm-profits\">Accelerating Your Law Firm Profits<\/h2>\n<p>Recently, I had a conversation with a mother-daughter pair who epitomized the divide between the traditional and the new entrepreneurial attorney. The mother likes the firm just the way it is, but the daughter\u2019s eyes lit up when we talked about tripling the number of attorneys.<\/p>\n<p>Today\u2019s entrepreneurs want to move fast. There isn\u2019t a magic pill that fixes everything, but focusing on these five things can accelerate your growth and help you build the firm you envision.<\/p>\n<hr class=\"wp-block-separator has-alpha-channel-opacity\" \/>\n<p class=\"has-small-font-size\">Image \u00a9 iStockPhoto.com. <\/p>\n<div class=\"wp-block-media-text alignwide is-stacked-on-mobile has-white-background-color has-background\">\n<figure class=\"wp-block-media-text__media\"><a href=\"https:\/\/www.attorneyatwork.com\/subscribe\/\" rel=\"nofollow noopener\" target=\"_blank\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" width=\"372\" height=\"106\" src=\"https:\/\/i0.wp.com\/www.attorneyatwork.com\/wp-content\/uploads\/2023\/06\/AttorneyatWork-Logo-%C2%AE-2021-1.jpg?resize=372%2C106&#038;ssl=1\" alt=\"\" class=\"wp-image-100019522 size-aaw-full-width-no-crop\" title=\"\"><\/a><\/figure>\n<div class=\"wp-block-media-text__content\">\n<p><strong>Sign up for Attorney at Work\u2019s daily practice tips newsletter <a href=\"https:\/\/www.attorneyatwork.com\/subscribe\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">here<\/a> and <a href=\"https:\/\/feeds.transistor.fm\/attorney-at-work-today\" rel=\"nofollow noopener\" target=\"_blank\">subscribe to our podcast<\/a>, Attorney at Work Today.<\/strong><\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Today\u2019s lawyer-entrepreneurs want to move fast\u2014and they&#8217;re frustrated, says Brooke Lively. Focus on these five things to keep your growth from stalling. The post Law Firm Profits: 5 Ways You May Be Sabotaging Your Firm\u2019s Growth appeared first on Articles, Tips and Tech for Law Firms and Lawyers. Not growing fast enough? Here are five [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[17],"tags":[],"class_list":["post-129104","post","type-post","status-publish","format-standard","hentry","category-legal_matters"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/posts\/129104","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/comments?post=129104"}],"version-history":[{"count":0,"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/posts\/129104\/revisions"}],"wp:attachment":[{"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/media?parent=129104"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/categories?post=129104"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/xira.com\/p\/wp-json\/wp\/v2\/tags?post=129104"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}