The key mistake that many small law firms make, that once understood, changes everything.

Many, many principals of small law firms do not generate a great cash flow,  that adequately rewards then for the time, effort and stress of their work, let alone the money they have invested and risk they are taking on by investing in the firm.

Is it that the lawyers in these law firms are just not very good?

Is that the reason why they generate such poor results?

I suggest to you that almost certainly that is not the case with the majority of law firms.

So what is it?

The sentence that I just wrote, is part of the problem.

If a law firm is chronically underperforming, it is easy to simply say, they mustn’t be very good lawyers and that must be the problem.  Now, while that may be true in some rare cases, by and large that is not the problem.

I believe that the key mistake that many, many small law firm principals are making that is leading them to significantly underperform financially, is that they assume that when dealing with clients, it is all about the quality of their advice.

If that was in fact the case, great lawyers would always make a superior return to poor lawyers.

Now I am sure that you can think of a firm , probably one of your competitors, where you have seen some of their work and know that you can do a much better job, yet, they are much more successful that you.

Why is it so?

It hardly seems fair does it?

I will suggest to you that that firm has made a stunning discovery.

They have realised that generally their clients are not lawyers.

This almost certainly applies to your firm as well, but you may not have thought about it much.

Not thinking about that is costing you big-time. Try millions over your career.

Now read on.  I know I am stating the obvious, but by not recognising the obvious, it is costing you big time and the firm down the road is cashing in. The principals in that firm are enjoying the fruits of their labour, while you worry how you are going to maintain your lifestyle.

Once you understand that your clients are not generally lawyers, it all starts to become clear doesn’t it why the firm down the road who aren’t as good as you, are leading the lifestyle that you deserve.

If your clients are not lawyers, do you think they know whether your work could have been a bit better?

Whether your contract would have taken in the new changes to the law that the other more profitable firm down the road had overlooked?

So if they are not judging you on that, what are they judging you on?

The things they do understand.

–       If you don’t return their telephone call or email,

–       If your receptionist  plays 20 questions in his or her interrogation before they get to speak with you, if in fact they do.

–       The receptionist will check if you are available FOR THEM ( note the emphasis- that is important to belittle the client for maximum effect).

NB Try ringing your firm and pretend to be a potential client: are you embarrassed and ashamed of the experience?

–       Did you make them feel important, especially after they had been belittled by the receptionist?

–       Did you empathise with their problem?

This is the sort of thing that your client will judge you on.

If you still think it is about the skills you bring to the table, think that at your peril.

Does that mean that you can do poor technical work? Of course not, that is clearly not what I am suggesting.

Once you grasp that your clients are not lawyers and that they judge you on all the none technical stuff they do understand, you can really can start to put in place the changes you need to ensure that your clients have a great experience when they deal with your firm.

While it is simple it is not necessarily easy, but once you grasp the concept, your required actions become much clearer.

It is my belief that what I have explained in this article is one of the absolute keys for you to unlock the profits you deserve.

Do I think it is fair that the less technically skilled firm down the road is earning double or triple what you are?

No I don’t and I want you to do something about it.

My mantra is that great profits in small law firms are a choice. You either make a choice to earn them, or unfortunately like most, you don’t make any choice at all, which is a default choice to not earn them.

Try explaining to your spouse when you realise that you can’t afford to retire, that you made a choice to be in that financial situation. See what sympathy you get.

Mostly in Western countries, we get what we choose in life , so choose great profits and start earning the profit you deserve today.


Colin Ritchie passionately believes in the future of the legal profession and knows that helping firms to dramatically improve profits and practice valuation is his way of ensuring that the legal profession has a bright future.

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