Office choices speak louder than words

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Published on 12/10/07

Our previous look at a sound financial footing for the new firm creates the foundation for determining the nature of its infrastructure — bricks and mortar, computers and software. Each element is essential, but choices should reflect practical analysis and decision.

Your office space will speak loudly and clearly to clients and lawyers about what kind of firm you are. A start-up entrepreneur might prefer going to a strip mall location with ample free parking. A large office with conference rooms speaks to the potential for team meetings and collaboration; small and simple offices suggest simpler, less adversarial approaches.

Lawyers' personal taste and professional style are also reflected in office space. Some small firm or sole practitioners like being in a diverse professional environment, sharing space with accountants, brokers and other nonlawyers. Others may be comfortable with an office sharing arrangement where lawyers share the expense of a reception area, conference rooms, clerical staff and office equipment.

Real estate costs that are lower than average make a statement about the law firm itself — that it is sensitive to the cost structure for the benefit of not only its equity partner owners, but also its clients (since lower overhead could well translate into a lower fee structure).

Would your current and prospective clients think you too expensive if you had better quarters? Or would their respect increase and allow you to take on better cases and charge more for them? The answers lead to conscious choices consistent with the goals of your practice.

A similar thought process applies to technology. Particularly for new solo practices, substantial spending on new computer hardware and software may simply not be possible. Certain tactics can provide a high return-on-investment on very modest technology spending, while still offering adequate capabilities from the standard of care viewpoint.

Rather than buying a new laptop or PC, try starting with a refurbished one. Or go with open source software and a free e-mail management program instead of Microsoft Office and Outlook. Purchasing an expensive online research service can also be postponed by regular visits to the library at the most convenient courthouse or law school.

Any such tactics can give the benefits of technology to a lawyer newly in practice, without the big initial expense. But they are, at best, stopgaps, making a real investment in new technology necessary.

Determining the optimum ROI for this investment depends on the source of funds or financing used. Paying cash eliminates finance charges, but means a big up-front expense. Leasing equipment provides tax advantages, but typically only covers hardware.

A third alternative is to borrow money from a bank or the Small Business Administration. The length of a bank loan for equipment will usually be less than the several-years depreciable life of the equipment and software.

The needs and resources of the new firm will determine the choice. Your marketing strategy, our final topic in this series, will reflect the results.

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