Getting Back On Your Feet
The loss of a major client can be devastating to your practice. Perhaps a
client-company's reorganization or bankruptcy was the event that
precipitated such a loss. Regardless of the cause, the result can be a
substantial and sudden shrinkage in your firm's revenues.
Restructure or Rebuild
Unfortunately, cutting attorneys, support staff or possibly both are
potential solutions to offset reduced revenue stemming from the loss of a
major client. If you choose the staff-reduction route, be sure to consider
not only individual productivity and present position and responsibilities
but also how retraining and reassigning certain key staff members may fit
into your restructuring plan. Find an attorney-to-support-staff ratio that
maximizes efficiencies. Lastly, communicate openly with your staff regarding
short- and long-term goals and the reality of staffing changes.
Alternatively, consider a longer term approach that focuses on rebuilding
your billings. Cultivate active prospects through ongoing outreach efforts.
Refine your marketing plan and take some time away from practice matters to
identify and nurture contacts with the best potential to generate increased
billings over time.
Play Preventive Defense
Having sustained the loss of a major client, the last thing that a law
practice wants to experience is a repeat occurrence. Take steps to reduce
the risk of the loss of another major client that could be considered "too
big to lose." Consistently track the percentage of your firm's revenues
attributable to each large client. And consider balancing any relationship
that's growing "too large" with business from other clients by:
- Targeting new clients that will diversify your base
- Attracting new partners whose clients will broaden your base
- Striving to expand the billing of clients other than your major client(s) for a better balance of revenue generation
This newsletter is provided by
Somerset for our clients and other interested persons upon request.
Since technical information is presented in generalized fashion, no
final conclusion on these topics should be made without further review.
For additional information on the issues discussed, please contact
Steve Riddle,
Tom
Thieme,
Rex Collins,
Ken
Stalcup or
Doug
Ayres
of our
Litigation, Valuation & Forensic Team.
This document is not intended or written to be used, and cannot be used,
for the purpose of avoiding tax penalties that may be imposed on the
taxpayer.
Somerset CPAs,
P.C.
3925 River Crossing Parkway, Third Floor
Indianapolis, Indiana 46240
317.472.2200 • 800.469.7206 • FAX 317.208.1200
www.somersetcpas.com
info@somersetcpas.com
