What is a reasonable revenue goal for an attorney's business development program? A quick search of the Internet does not yield much in the way of specific suggestions on this topic.
The Rainmaking Lady's suggestion is to start with a simple minimum calcuation of one times the attorney's annual salary, plus a 25% factor for benefits.
Payscale.com identifies average attorney salaries starting at $57,500 in Year 1, climbing to $114,958 in Year 20. Details at:
www.payscale.com/research/US/Job=Attorney_%2F_Lawyer/Salary
For purposes of an example, let's make it simple and work with a 10-year attorney who is earning about $100,000 per year. This number jumps to $125,000 with basic benefits. An annual rainmaking goal of 1.25 times salary translates into just over $10,000 per month in new business development. Looked at in terms of billable hours, it is 50 hours at $200 per hour, or 25 hours at $400 per hour.
Is this a reasonable business development goal? Maybe. Maybe not. Depends on the firm and the attorney. It is certainly a stretch goal, rather than a slam-dunk goal. One new $10,000 account per month most likely means there have to be about nine other leads that did not convert to new business yet. Which means that an attorney has to maintain a continuous, focused effort on finding qualified prospects and converting them to clients.
Since business development time is so precious, it is easy to see the importance of creating and implementing an effective business development plan and sharpening one's selling skills. Where will new leads be found? Knowing the profile of your ideal client will help. What services are worth $10,000, particularly when transactions are slowing to a trickle? The attorney who offers an effective solution to known problems faced by those ideal clients is in the best position to make the $10,000 sale.
As stated, the above example of 1.25 times salary is a minimum goal. Three times salary is better ... 1 multiple to cover the attorney's expense, 1 multiple to cover overhead, and a 1 multiple profit contributor.
By the way, some other interesting (albeit dated) law firm management statistics were identified in researching this post. For example, see "Fiscal metrics to gauge a law firm's health," published by Altman Weil in 2003:
http://www.altmanweil.com/dir_docs/resource/5d291e17-a814-4091-9d87-3bb8fc664102_document.pdf
Subscribe to:
Post Comments (Atom)
Posts
1 comment:
When you say three times salary - are you talking about gross revenue per lawyer or new business generation?
Post a Comment