September 12, 2006
Top 25% of Law Firms Earn Margins Above 40%
Larry Bodine’s Professional Services Marketing Blog is well worth checking daily. In a recent post, he asks, "Is Your Firm’s Profit Margin 40%?” Then he points out that if it isn’t, it could be, based on his experience working with law firms.
Larry was one the folks who teamed up with Juris, Inc. to encourage midsized law firms to participate in the Juris Law Firm Economic Survey conducted earlier this year. The results are in and Larry Bodine and participants should receive copies of the 55-page survey results and analysis within the next two weeks. The report will be available to others after September 30 for $375.
Firms in the top 25 percent measured by per-partner income had an average margin greater than 40 percent. They didn’t get there by cutting costs or by having a higher than average realization. In fact, their cost per head is higher than the remaining 75 percent of firms. How can they spend more and still outpace other firms in terms of margin? They do it by concentrating on revenues rather than expenses. They generate more fee dollars per head through higher effective rates and better utilization of their legal team.
The Juris Law Firm Economic Survey of midsized U.S. law firms for 2005 identifies 10 important factors that influence law firm financial performance and partner earnings. For more information about the survey or to purchase the 55-page click on the image below.
Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.
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Filed under Blog by Tom Collins