When a country’s economy does not run efficiently for an extended period of time, it is inevitable that the country will enter into a recession – a period when interest rates fall, profits plunge, unemployment rises and there is a feeling of overall uncertainty. Mostly all businesses will feel a pinch at some point or another, including law firms. Whether its due to a decrease in clients, possibly due to mergers or acquisitions, competition from other firms or a reduction in budget spending, firms may suffer. Here are a few ways to help give some protection and help your firm remain somewhat recession-proof.
- Keep Client Relationships Strong
Client relationships are hugely important, but even more so in a down turn. When business is slow, competition gets fierce and so it’s important for every firm to maintain relations with companies and people they do business with. By focusing on top clients through regular visits, firms remain engaged and a bit of hand-holding in turbulent times can build tremendous client loyalty.
- Determine Profitable Practice Areas
Focus on practice areas where your firm has the greatest ability and aim to target these sources of revenue. For example, property developers may have issues and disputes surrounding contracts or employees and if you can demonstrate expertise and can assist clients quickly, many firms will benefit. Reviewing expenses and revising budgets are also important steps to consider whilst waiting for the economy to return to better times.
- Review Marketing and Business Development Plans
Marketing is often one of the first things to be cut in a recession, although it can be a costly mistake. Develop a marketing plan to bring in new clients, ensuring it is specific and followed. Market your practice, build referrals and even improve your skills for a hot new area of practice you may have identified. Communicate your expertise via letters and mailers, email and possibly social media to various referral sources as well as clients present and past and explain the potential economic problems they may face and what your firm can do to help.
- Establish a Referral Group
Pay attention to re-establishing relationships with businesses that may refer your firm to others. For example, ask your clients which organisations they belong to and inquire if you can attend a meeting with them. Not only does this help with introductions to new clients, but allows for the opportunity to expand existing relationships.
- Look for New Opportunities
Find out how you can provide assistance to civic and charitable organisations in your area as this may lead to developing relationships with a whole new group of clients. By networking within your local area or offering conferences or seminars on hot topics of interest, you are providing the best client service in your community.
When recession hits, businesses slow down. To help prevent your law firm from feeling the effects of a downturn in the economy, focus on your most important assets and spend time re-evaluating internal marketing and business development plans. Just remember that a recession will usually run its course and over time the economic outlook will be positive again.