This long-time solo has found a way to switch the focus of her practice in response to the changing needs of her clients. Prior to the economic downturn, her practice consisted largely of advising clients on buying and selling homes, including reviewing contracts of sale and other documents associated with the purchase of a home. Now that the housing market is down, she finds herself consulting with clients on how to handle problems with their existing mortgages, preparing deeds in lieu of foreclosure, and handling mortgage modifications.
She describes the shift in her practice to be a general shift to damage control by her clients. The type of work she is now needed to handle is very labor intensive, with a steep learning curve and constantly changing rules. Clients find her via referrals from other attorneys and real estate professionals. Although she has increased her networking with other attorneys, she does no other marketing of her practice. The volume and income from her practice have remained fairly steady over the past few years.
This sole practitioner, who handles real estate matters in addition to probate and some litigation, believes solos can do fine in a down economy. He believes solos can be more flexible and responsive to potential areas of practice. One must, however, pay attention to what people need.
In his own practice, after the real estate downturn, Jones began advertising his availability for evictions. This foray was successful and has resulted in a number of “routine” evictions. He charges a flat fee with additional set fees if a hearing or additional complication is required. The fee was carefully set to be attractive to landlords but not so high as to encourage landlords to handle it pro se. This practice generates fair income and, in addition, increases his client base for other potential work such as drafting or revising leases.
White River Junction, Vermont
This solo represents debtors in bankruptcy and handles criminal defense and tax matters. Until several years ago, she and her husband practiced law together. When he departed the practice to take a job with the state, she was left with high overhead and staff. Keeping up with expenses became more challenging, and Kainen found herself taking on more clients who were difficult to deal with just to meet overhead. When the office lease came up for renewal, she gave up the large space in favor of a small space and no staff. She considers the downsize to have been successful. Now bills are paid more easily, and she can be more selective about clients. No longer is there a concern about meeting overhead. Although sometimes she feels extra space and the work of an assistant would be nice, overall her quality of life is much improved, and she has no plans to expand either space or staff until the economy improves.
Some 1,400 miles west, this solo maintains a practice in juvenile and criminal law along with some estate planning and probate. He describes the changes he made in response to economic changes below:
I went spartan about four years ago—gave up a beautiful but expensive office, dropped expensive memberships, and virtually quit networking. I took a small office downtown in an old, nearly empty building for $300 a month and focused on making a full-time business out of doing court-appointed work. I became very selective about taking private clients and still turn down or refer away more clients than I accept. I had to move when they decided to remodel my office building and took a more expensive office one block from the courthouse—a nice corner office with an equally nice conference room. The conference room makes it much easier to work with clients, and my office has become progressively messier now that I don’t need to clear my desk every time a client comes in.
I scan everything that comes into the office and give originals to clients. I keep no paper files—I don’t even own a filing cabinet. I use SugarSync to keep my office computer, home computer, iPad, and iPhone in sync with all client files. I back up my home and office computer to a hard disk. I use Fastcase on my iPad and iPhone, Casemaker on my iMacs.
Volume-wise, my practice is about 75 percent appointed work, but by revenue it is about 50/50. Court-appointed clients are much easier to work with than private clients. I only work about 20 hours a week and make a pretty decent income. I wouldn’t mind being a little busier, but most of the time I just get more selective about which clients I take on. There are a few other lawyers I see regularly who are doing pretty much the same thing.
This patent and trademark attorney has clients that run the spectrum from one-person businesses to Fortune 500 companies. Grierson has noticed a slowdown in business in recent years. He finds that there is more competitiveness in fees and that clients are looking much closer at bills. His firm’s primary adjustment in response to the economy is an increase in the use of fixed fees. No matter the size of the fee, he has found his clients appreciate more predictability. Offering fixed fees allows Grierson to emphasize his firm as a low-cost alternative to big firms. Most of his clients are the result of referrals from other attorneys and former clients.
What about family law? Surely family law practitioners have been hard hit by the economy. True enough, according to Gienapp (who is licensed and practices in both Massachusetts and New Hampshire). Gienapp has been handling family law matters as a solo for more than 20 years. What used to be a staple of her practice—amicable, simple divorces—are more and more being handled by the parties pro se. This trend is driven by the economy and the decreasing hours the courts are open. Many courts provide forms to assist pro se clients. In addition to the increase in pro se divorces, many people are postponing divorces simply because neither party can afford to live separately.
Thus, Gienapp is seeing a significant increase in complicated and adversarial divorces. Most involve custody disputes. The parties are not necessarily more affluent; in many cases, the fees are paid by the parents.
Gienapp’s clients find her through referrals from other attorneys, former clients, and her yellow pages listing. Although the practice is as busy as ever, net income has remained unchanged in recent years. The cutting back of court hours and staff also contributes to the increased costs of her cases because it is more difficult to obtain timely hearings.
Redwood City, California
This solo’s practice includes commercial litigation in both state and federal court, transactions, and acting as a general counsel to small businesses. Winghart, who graduated from law school in 1999, opened his solo practice in February 2009, arguably the low point in the recent economic slowdown. He started out on a shoestring budget, keeping expenses lean.
Winghart states that the pace of litigation, economic downturn notwithstanding, has not slowed. Many of the cases he is handling are a result of failed business deals. For about a year to a year and one-half after the recession hit, he had to offer more and extended payment plans to his commercial clients, rather than the standard retainer and monthly billing. That practice has mostly ceased, however, and most of his clients are now paying according to his standard hourly rate on a monthly basis. Most of his clients are keeping current with their billings. Winghart’s transactional practice was slow for the past couple of years but has recently picked up. More clients are willing to take risk and embark on business opportunities. His outside counsel services for small businesses has stayed fairly constant. Most of his clients are referred by other attorneys, although he obtains some business from third-party aggregators such as Avvo.com, Yelp, and LawPivot.
As a result of lessons learned in the recent slowdown, Winghart now requests more substantial retainers, is more selective in client choices, and keeps a close eye on receivables and on overhead costs. Although he is seeing more potential clients shopping attorneys as to fees, Winghart’s fees are competitive enough that he describes his practice as constant and growing.
According to this solo, the local economy around Harrisburg, Pennsylvania, seems to be on an upswing—her practice has been humming along all year:
My practice is primarily small business and nonprofit work, along with some estate planning and administration. New clients keep calling, both through referrals and Internet searches, and I’ve had a good amount of repeat business from previous clients. I also have monthly subscription clients, where I serve as the equivalent of an in-house counsel to those who can’t afford that luxury.
Networking groups, both local and online, have been key to my practice. It took me some time initially to figure out that networking is more about making connections and helping each other with referrals, rather than trying to sell legal services to your contacts.
I work at connecting people in my networks and client base who seem to be good matches, regardless of whether the connection has an immediate impact on my practice. Helping others to make meaningful connections pays dividends later, when those you’ve helped recommend you to others who need your services.
One of the hardest things about solo practice is having to be your own rainmaker in addition to all of the other things you have to do as a solo: accounting, billing, and other administrative work; keeping on top of your schedule; and, oh, yes: doing the actual legal work. It’s easy and tempting to let it slide, but spending time on promoting your practice and being a good resource to others lead to real rewards. It won’t happen instantly, but if you keep at it, your practice will benefit.
Monks operates a criminal law practice with his brother. His brother handles general criminal defense with a large number of DUI cases, while Monks’ practice is primarily representing truckers in traffic ticket and related cases. Many of Monks’ clients are trucking companies, which hire him directly to represent their employees. The tightening of the cash flow has meant that many of his clients have revised their agreements to more flat fees and sliding scales and, in some cases, no payment until the final disposition of the case. Because most of the companies Monks represents are clients of long standing with good payment histories, such agreements have been acceptable. The firm’s individual criminal defense clients have, in recent times, been less able to pay retainers, requiring payment plans and sometimes financing of fees.
One of the most innovative changes the firm has implemented to deal with the volume traffic ticket practice and overhead is to put in place a “pooling” agreement with a small group of local lawyers who also handle traffic tickets. They share the dockets in the multiple municipal trial courts in Houston and surrounding cities for appearances and resets. Each attorney handles his or her own trials, for the most part, although each will handle the trial of another “pool” member for a set fee. This arrangement allows for handling a greater number of cases and has substantially reduced the firm’s overhead. Without the pooling arrangement, they would have had to hire another associate. [Note: readers should consult and comply with their states’ ethics rules prior to putting in place “pooling” or other “sharing” arrangements.]
About a third of the firm’s clients are from existing company clients, a few from legal plans, but the major source of clients is from former clients or client referrals. Monks posts fairly regularly on Facebook and LinkedIn to reinforce his presence with existing clients and encourage client referrals. Net income for the firm has remained fairly constant over the past couple of years.
Lessons for the New Normal
So, what have we learned from our visit with a few solos and small firm lawyers? Are there any common factors? Anything to learn from their experiences?
It must be acknowledged that this is only a very general overview. The practice areas and geographic areas vary greatly; some factors may be limited to practice areas or regional circumstances. Despite that limitation, I believe there are a few commonalities and some lessons to be taken.
First, it seems that almost all the lawyers interviewed receive the bulk of their business as referrals from other attorneys and/or clients. From that, we see a reinforcement of the importance of doing good work for our clients so they will come back and refer others to us, as well as the importance of networking with other attorneys.
Further, it should be no surprise that most solos and small firm lawyers are keeping a close watch on overhead, including staff, with some cutting expenses more substantially than others. Another common theme is the offering of alternative payment arrangements to clients. Interestingly, few seem to have formal marketing plans or programs, although a couple have newsletters and some are active on social media. Not all of the featured lawyers have websites. Most are sensitive to the market and to current client needs, and they have tweaked their practices accordingly.
Most encouragingly, it seems most are at least holding their own and many are even thriving, despite the grim economic times. The lawyers featured here seem to have found a way to make the needed changes to meet current conditions in order to succeed and have, in fact, been successful in their efforts.