At first thought, starting a law firm during COVID-19 may seem like an impossible task. There are, however, many benefits to take advantage of if you choose to start your law firm during the current pandemic. With many practitioners facing salary cuts, reduced business and even unemployment, now may just be the perfect time to channel your energy into something you’ve always wanted to do – start a law firm.
The perfect conditions for starting a business, particularly a law firm, will never exist. There will always be hurdles to overcome, whether they’re financial, economic or personal. Think about the law firms you’ve previously worked at or the firm you currently work at. They were all start-ups at some point. They each faced, and more importantly, overcame a range of hurdles to get where they are today. Waiting for the ‘perfect’ time to start a law firm will likely never come. The success of any start-up is ultimately rooted in the ambition, persistence and dedication of its founder and their entrepreneurial drive to succeed. Economic factors will never be solely responsible for your firm’s long term success.
If you’ve been considering starting a law firm or going out on your own as a sole-practitioner, we’ve explored some of the key concerns you may have about taking the plunge during (or even after) the COVID-19 pandemic.
There’s no denying that staring any type of business involves a considerable outlay of funds. If you can afford to outlay these funds now, however, it’s far more likely that you’ll get greater value from that initial outlay – more bang for your buck!
Think about the resources (tangible or otherwise) that you’ll need as a minimum to get your firm up and running. You’ve probably considered many of the following:
You’ll notice that a physical office space has not been included in this list. The last few months have proved for good that law firms can remain productive and maintain their client service without the need for a permanent, physical office space. Starting a firm during a pandemic further reduces the need for a permanent or physical office. Opting to work from home or to utilise a flexible (hired) office space on selected days or for face-to-face meetings can save you a considerable amount of money.
Once you and your firm have found your feet, there’s nothing stopping you from expanding into a permanent office space. For now, however, adopting a more flexible arrangement won’t impede your ability to get your firm up and running. Simply opting for the right practice management software and dedicating some time to creating client service processes will give your firm everything it needs to succeed, irrespective of where you choose to work from.
An added bonus of starting a firm now is the savings to be made on the likes of office furniture (such as a comfortable chair and desk), computers and software. Healthy competition between technology retailers, for example, means there are unprecedented savings to be secured as prices continue to be reduced. The Australian Government has also announced an extension to the instant asset write-off scheme, which will now run until 31 December 2020. Under the scheme, eligible businesses can claim an immediate deduction for “…the business portion of the cost of an asset in the year the asset is first used or installed ready for use.”
In the beginning, working for yourself can be unpredictable – cash flow can be slow to start and it may take some time before you’re making a solid profit and have recouped your initial outlay. This reality is only short term though when you compare it to the success your firm could have in the years to come. This is why starting a law firm now will help minimise this impact – saving on resources like those discussed above will mean you have less to recoup before you can start making a profit.
Running your own firm, at least in the beginning, will mean that you won’t necessarily have the security of a pre-determined pay check each month. However, if this global pandemic has taught us anything, it’s that no job is secure, regardless of how large or established your current (or previous) employer is, or how senior and experienced you are. This uncertainty shouldn’t stop you from setting up your own firm and securing the success, flexibility and work-life balance that you may ultimately be chasing.
Contrary to popular belief, many businesses (including law firms) were started during times of economic downturn and recession. Why? Because times like this prompt people to reconsider their current working arrangements as they navigate a reduced income, difficult working conditions and even unemployment.
You’re not alone if you feel like work in your particular practice area(s) has slowed since the advent of COVID-19 and related restrictions. You may even be considering moving into other areas of practice, whether out of necessity to increase incoming work or to pursue an area of law you believe will be more rewarding or enjoyable.
If you’re nervous about pursuing another a practice area, finding a mentor can be a great place to start. While the current restrictions are still in place and many practitioners have more spare time on their hands, now is the perfect time to seek guidance from other practitioners. Online forums across LinkedIn and Facebook, for example, are currently full of practitioners across varied practice areas connecting and sharing advice for pursuing other areas of law.
If you’re struggling to find a mentor or are looking for additional support and reassurance as you pursue a new practice area in your start-up firm, having reliable legal guidance can prove invaluable. By Lawyers is a prime example of this. As Australia’s leading library of up-to-date legal content, they’ve proved to be invaluable particularly for sole practitioners and new law firms as they navigate day-to-day practice. By Lawyers will always be there to provide guidance if you’re unsure about a particular area of law, with helpful commentaries, precedents, forms, guides and links to relevant legislation and case law. By Lawyers is a must-have resource for any new firm or first-time sole practitioner looking to expand their practice knowledge.
Starting a law firm may seem like a daunting task. With proper planning, however, it can become achievable. Before you take the plunge and begin purchasing equipment, take some time to review the checklists available in the recently revised 10 Step Guide to Starting a Law Firm. If you’re looking to start practising without a traditional brick and mortar office, take a read of The Lawyers Guide to Working Remotely. Both of these resources have been carefully crafted to provide sole practitioners and start-up firms with guidance as they establish their practice.