economics of practicing consumer law 2012

The Economics ofConsumer Law Practice

Houston 2012

Ronald L. BurdgeThe Law Coach .com

© 2012 RLBurdge

Do Good

© 2012 RLBurdge

Do Good

You have to

Do Well

If you want to

© 2012 RLBurdge

Planning Nowfor a Practice Later

“Personal Life” Social Media

- vs –

“Law Life” Social Media

Rules to Remember

Knowing Your Numbers

© 2012 RLBurdge

Tips on Starting a Practice

Tips on Starting a PracticeTips on Starting a Practice

Starting a Consumer Law Practice Without Clients

(and Without Starving)

© 2012 RLBurdge

Tip #1 on Starting a PracticeTip #1 on Starting a Practice

Read

Jay Foonberg’s

Book

© 2012 RLBurdge

Tip #2 on Starting a PracticeTip #2 on Starting a Practice

Market yourself to other lawyers

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Tip #3 on Starting a PracticeTip #3 on Starting a Practice

Avoid costly phone book display ads

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Tip #4 on Starting a PracticeTip #4 on Starting a Practice

Get an easy-to-remember

phone number

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Tip #5 on Starting a PracticeTip #5 on Starting a Practice

Publish a Professional Announcement

In local bar newsletter

and newspaper

© 2012 RLBurdge

Tip #6 on Starting a PracticeTip #6 on Starting a Practice

Write articles

on Consumer Law

for bar newsletter

© 2012 RLBurdge

Tip #7 on Starting a PracticeTip #7 on Starting a Practice

Give speeches to

Bar Organizations

and civic groups

© 2012 RLBurdge

Tip #8 on Starting a PracticeTip #8 on Starting a Practice

Hire a support staffer

who has the aptitude

to research people and records

© 2012 RLBurdge

Tip #9 on Starting a PracticeTip #9 on Starting a Practice

Set up your own web site yourself

And use a catchy name and then blog, blog, blog, blog

Work Social Networking

© 2012 RLBurdge

Tip #10 on Starting a PracticeTip #10 on Starting a Practice

1 + 1 + 1 + 1 + 1 = 1

© 2012 RLBurdge

Tip #11 on Starting a PracticeTip #11 on Starting a Practice

Pick an easy-to-find location

for your new office

© 2012 RLBurdge

Tip #12 on Starting a PracticeTip #12 on Starting a Practice

Set up your office in same Building

with other attorney offices,

For referrals and mentoring

© 2012 RLBurdge

Tip #13 on Starting a PracticeTip #13 on Starting a Practice

Pay referral fees in cookies

to referring attorney’s secretary

© 2012 RLBurdge

Tip #14 on Starting a PracticeTip #14 on Starting a Practice

Write a column

on Consumer Law

for local newspaper

© 2012 RLBurdge

Tip #15 on Starting a PracticeTip #15 on Starting a Practice

Limit contingency fee cases

to ½ your case load

© 2012 RLBurdge

Tip #16 on Starting a PracticeTip #16 on Starting a Practice

Remember: the best advertising you will ever get is from a happy client.

Make your client’s case your case … make it personal.

© 2012 RLBurdge

Bonus Time !

© 2012 RLBurdge

www. The Law Coach .com

© 2012 RLBurdge

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© 2012 RLBurdge

www. The Law Coach .com

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The Practice of Law ?

© 2012 RLBurdge

Riches to Rags

© 2012 RLBurdge

Riches to Rags

TheKingofTorts

Melvin Belli

© 2012 RLBurdge

Rags to Riches

© 2012 RLBurdge

Rags to Riches

© 2012 RLBurdge

Old RuleOld Rule

$ in$ in-Bills paid outBills paid out

== $ Left Over $ Left Over (your profit)(your profit)

© 2012 RLBurdge

© 2012 RLBurdge

New Rule

It’s a Business

Run it like one

The Name of the Game: Profit

© 2012 RLBurdge

“What do you mean, my paycheck will be a little late this week?”

© 2012 RLBurdge

New Rule

Be a Lawyer

Not a Business Manager

© 2012 RLBurdge

TheProblem

Solution?

New Rule

Hire a Business Manager

And Pay them Well

© 2012 RLBurdge

SCORE.org

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New Rule

Have a Budget

And Live by it

© 2012 RLBurdge

Time Management Matters

© 2012 RLBurdge

Time Gobblers

Email

Confusing Priorities

“Paper” Shuffling

Interruptions

© 2012 RLBurdge

New Rule

Have a Budget

And Live by it

© 2012 RLBurdge

New Rule

Know Your “Break Even” Number

© 2012 RLBurdge

New Rule

Know Your Daily Numbers

© 2012 RLBurdge

New Rule

Recalculate Your Hourly Rate

Reverse Calculate it

© 2012 RLBurdge

Know Your Numbers

EGN / IGN = Hourly Rate

Expense Generating Numbers

Divided by

Income Generating Numbers

= Hourly Rate© 2012 RLBurdge

Expense Generating Numbers

Taxes Rent

Salaries Telephone

Utilities Debt Retirement

Supplies Equipment

Repairs Advertising

Maintenance Insurance© 2012 RLBurdge

Income Generating Numbers

Total Firm Billable Hours

Whose hours ?

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Total Firm Billable Hours

Attorney

Paralegal – Law Clerk

Secretary

© 2012 RLBurdge

Weight the Rates

0

0.25

0.5

0.75

1

AttorneyParalegalSecretary

© 2012 RLBurdge

Weekly Billable HoursWeighted

RateAvailable

HoursBillable Hours

Attorney 1 45 45

Paralegal .5 40 20

Secretary .25 20 5

Total 70© 2012 RLBurdge

Reverse Calculating Hourly Rate

Example:

1 Attorney - $100 k Salary

1 Paralegal - $42 k Salary

1 Secretary - $30 k Salary

© 2012 RLBurdge

Reverse Calculating Hourly Rate

Expense Generating Numbers

Divided by

Income Generating Numbers

= Hourly Rate

© 2012 RLBurdge

Expense Generating Numbers

Taxes Rent

Salaries Telephone

Utilities Debt Retirement

Supplies Equipment

Repairs Advertising

Maintenance Insurance

= $7,000© 2012 RLBurdge

Reverse Calculating Hourly Rate

$7,000 + 15% = $8,050 (EGN)

Divided by

70 – 15% = 59.5 hours (IGN)

= $ 135.29 Hourly Rate

© 2012 RLBurdge

New Rule

It’s a Business

Run it like one

The Name of the Game: Profit

© 2012 RLBurdge

New Rule

The Cost of Losing Billable Time:

15 min/day = 1.25 Hr/wk

= 65 Hr/yr

65 Hr x $150 ………... = $9,750

© 2012 RLBurdge

Bonus Time !

© 2012 RLBurdge

Top 3 New Rules

To Really Succeed

1. Be a Lawyer, not a Manager

2. Know Your Numbers

3. Give it Back

© 2012 RLBurdge

Business Helpers

© 2012 RLBurdge

You have to

Do Well

If You want to

Do GoodHouston 2012

Ronald L. BurdgeThe Law Coach .com © 2012 RLBurdge