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Why Do Small Law Firms Feel Pressure from Clients?

September 04, 2020

Dealing with clients in a professional and effective manner is an important aspect of the legal profession. Investing in and valuing client relationships is critical to having low client churn and successful small law practice. However, the legal market is quickly shifting from a seller’s market to a buyer’s market. As a result, keeping clients satisfied has become more of a priority for your bottom line than ever before—and attorneys everywhere are feeling the pressure.

Why Do Small Law Firms Feel Pressure From Clients?

Firms often feel the greatest amount of pressure from their clients during the billing and invoicing processes. Clients are constantly demanding increased transparency, greater customer service and more work at reduced fees. For a small firm, this often creates a high demand and carries a high cost. 

Today’s clients want firms to provide immediate communication that delivers transparent customer service, but this isn’t always possible. Furthermore, clients typically want to know what deliverables were accomplished during the billable time they were charged for and to be provided with an itemized list that helps them understand the progress that was made on their claim. 

All this takes time, and many small firms struggle to find the perfect balance between ensuring client satisfaction and growing their business. Fortunately,  there are many ways of dealing with clients that address these challenges without diminishing the quality of your work product.

3 Reasons Why Small Law Firms Feel Increased Pressure From Clients

If your firm is seeing a lack of new business, referrals or a diminished client rapport, it’s a clear sign that you need to make changes to your operations. Here are a few of the main reasons small law firms feel pressure from clients, and what they can do to avoid these issues:

1. Lack of availability

For small law firms, the level of communication and transparency clients demand can be daunting. It requires individualized and personalized attention to each client on each task. Small firms often simply do not have the bandwidth to provide the kind of customized service and attention modern clients crave, as it requires a lot of time and resources to meet every demand. This lack of time and resources can be quite costly, so it is not surprising that small law firms feel the pressure from clients. To address this issue, small firms should prioritize efficiency. Evaluate where your firm’s non-billable hours are being dedicated, as this will be a clear indication about where you need to improve your firm’s practices. Take this information and use it to improve your efficiency and increase your availability.

2. Competition from the internet

Small firms and solo practitioners have always had to worry about being the small fish in a big pond. However, today’s legal market has been inundated by self-help options that have both increased access to legal services and decreased the billable time law firms can expect from clients with less complicated claims. The internet has provided clients with access to legal resources that may cause them to question whether they want to hire an attorney at all. This can be challenging for any attorney, particularly when clients come to them with heads full of inaccurate or imprecise legal knowledge that they read online. When this occurs, an attorney must both convince clients of the importance of hiring an attorney and take the time to thoroughly explain why a certain strategy is more effective than the one their client found online. To address this issue, the best defense may be a good offense. Be sure your law firm has its own online resources, and publish articles to your firm’s blog or resources pages often. And of course, always be sure to drive home the importance of pursuing legal help from a licensed professional.

3. Working with difficult clients

Small firms, solo practitioners and lawyers just starting out in a new field often must deal with the pressure of taking on any business they can get. This often means dealing with difficult clients that other firms may refuse to deal with. Larger firms have the flexibility to take cases with higher profit margins and to screen clients, but small firms may not have this luxury. Working with difficult clients may take more time and energy than you expect, so be sure to build this risk into your billable rate. By padding your margins, you’ll be fairly compensated for the work you do for difficult clients while maintaining the capacity to provide a discount for others.

How Are Client Expectations Changing In The Legal Industry?

Modern clients want detailed information, and they want it immediately. These demands are hard to meet when small firms are also faced with deadlines and other clients competing for their attention. Transparency builds trust and loyalty among customers, but meeting every demand can easily become stressful and sometimes unmanageable. Over time, this can seriously threaten the success of a firm.

Firms need to find a way to find a balance between client satisfaction and fulfilling their bottom line. Building interpersonal skills and maintaining effective expectations is important in this regard, but efficiency is also key. By adopting new technologies, small law firms can achieve the efficiency they need to maintain success. Small firms will benefit tremendously by embracing all that technology has to offer to improve their business and administrative tasks. Improving your firm’s technology is also a good strategy to keep you in fair competition with other firms.

In today’s competitive legal landscape, it is especially important that small firms adjust their practices to reflect modern clients’ needs. In addition to top-notch legal services, clients value transparency, price predictability and access to information.