Five Ideas for Cutting Overhead Costs at Your Law Firm
Adam M. Levine
Even if your law firm runs “lean,” you may be missing these opportunities to cut overhead and improve profitability:
1. Renegotiate Your Office Lease — Does your firm need every square foot it currently occupies? Perhaps you have recently laid off staff or digitized paper files and no longer need as much desk or storage space. Talk to your landlord about giving some of it back in exchange for extending your existing lease. If you cannot reduce your footprint, try to negotiate a lower lease rate.
2. Outsource Services — Almost any law firm function can be outsourced: Copying and scanning, word processing and administrative support, billing, IT support — even legal work in the form of contract lawyers. Although outsourcing can save money, you need to consider quality, too.
3. Buy Smarter — Whether you are purchasing office supplies or food services, your firm may qualify for discounts if you consolidate orders, buy in bulk and purchase from a limited number of vendors. For example, if you host a catered lunch meeting every Tuesday, contract with one or two local restaurants for reduced costs in exchange for regular business.
4. Review Employee Benefits — Although benefit cuts can be controversial, you may be able to make cost-saving changes that everyone can live with. Consider increasing health insurance deductibles or offering a basic plan that employees can “upgrade” by paying higher premiums. (Note of caution: Beginning in 2015, your firm could face penalties if it is a “large” employer and does not provide sufficient coverage.) Also look for benefits and perks that are underused and less likely to be missed, such as subsidized parking or life insurance policies with larger values.
5. Make the Most of Your Technology — New technology offers law firms greater efficiencies. But chances are your firm has not fully realized the potential of the technology you already have. Many in-person meetings that require lawyers to travel can be conducted as effectively by teleconference or even via applications such as Skype (which is free). And with a basic remote access set-up, attorneys may be able to telecommute full-time, reducing your firm’s office space and utility costs.
For help implementing any of these ideas at your law firm, or for more information, contact Adam Levine at [email protected] or call him at 312.670.7444.