Addition by Subtraction: Law Firms Should be Focused on Profit

Lots of law firm owners are driven by revenue; and, there’s nothing wrong with that – so are lots of business owners. 

 

But, looking at that top-line number, with such a laser focus, can be problematic. 

That’s because the number that matters the most, involves an equation: it’s your profitability = how much do you make, minus how much you spend.  That is truly the measure of a successful business. 

 

The problem becomes that, if you’re too focused on what your gross revenue is, your expenses can creep up and up & you’ll lose your safety net (revenue). 

 

Law firm business owners should be looking at their profit & loss statements, at least every month, in order to bring this point home.  And, they should be scrutinizing those reports, with an eye to limiting expenses and increasing profitability, at least every year. 

 

. . . 

 

Let’s talk big picture law firm financial management!  Just reach out! 

 

Through a unique partnership between the bar association and Jared Correia's Red Cave Law Firm Consulting, Vermont Bar Association members have access to experienced law practice management consultants at a special discounted rate.

To get started, visit Red Cave's Vermont Bar Association landing page, and start running your law practice like a business.