News

4 Mistakes to Avoid When Expanding Your Business

By Mary Ellen Hickman, Hickman Consulting Partners

June 9, 2017

Mary Ellen Hickman, Hickman Consulting Partners

Ready to grow your practice? Before you do, beware of the typical pitfalls of expanding your business and how they could impact your services and clients:

1) Trying to be all things to all people.
Meaning, attorneys will either offer services beyond their true area of expertise, or they’ll recruit other attorneys/partners who have non-competing areas of expertise. Much, much better is to recruit those with overlapping areas of expertise (overlapping is even better than complementary). A strong focus in a particular area or in particular services results in a much stronger point of differentiation versus other firms. A stronger point of differentiation will attract a higher level of clients and enable attorneys to charge more for their services, and rightly so.

2) Expanding too quickly. A small practice needs a strong, well-trained support staff. Those who expand too quickly see a drop in the quality of the services and lose clients—and reputation—as a result. It’s difficult to grow at the same rate that you add quality support staff, but we help clients do this every day.

3) Paying for the wrong kind of marketing. Typically, it’s SEO or SEM (search engine optimization or search engine marketing, including Google ads), online listings, and sponsorships of (the wrong kind of) events. When we start working with a client, we review their marketing activities to determine what is effective and what isn’t. We typically cut at least 50 percent, and in many cases, up to 95 percent of the dollars budgeted for marketing. You’re better off taking the money home than spending it on ineffective marketing.

4) Trying to do it all themselves. Attorneys are used to being some of the smartest people in the room. But it doesn’t make them experts in marketing, strategic growth, or increasing profitability. I can write my firm’s business agreements, but I’m smart enough to know that an attorney who specializes in contracts will always do a better job at it than I will, so I'm happy to pay our attorney to do so (and she’s worth every dollar). I’ve seen attorneys do their own bookkeeping (even journal entries), file their own taxes, write their own messaging, and even design their own business cards—always to their own detriment.

Lawyers should also consider whether expansion is right for their business. It’s all about the numbers and the bottom line. A practice is much better off keeping the top line (revenue) flat, year over year, while increasing the bottom line (profitability). What that means: the same or less work for more money.

As mentioned above, expanding too quickly often results in delivering a lower quality of work or being less responsive. It’s difficult to find and train support staff, and these individuals are critical to your practice.

At the end of the day, though, it depends on what the attorney or partners want. We have attorneys who want to create and manage large practices, and others who want to work part-time or retire early. Most critical is to define what you want in terms of compensation, hours worked per week, and size of firm. Then we can create a strategic plan to get you there, including estimating the exact number of clients you need to support it and the specific marketing tactics and investment you need to attract those clients or referrals. An efficiently structured practice results in more billable hours and higher margins, and more take-home pay (or fewer hours) for the lead attorneys.


Hickman was a presenter at one of the D.C. Bar Practice Management Advisory Service’s Lunch and Learn sessions. Learn more about PMAS and its various offerings to help solo and small firm lawyers.