Serving Small Clients Profitably

Ed Wesemann in his book, THE FIRST MYTH OF LEGAL MANAGEMENT IS THAT IT EXISTS, suggests that small clients disproportionately drain the resources of law firms while providing a disproportionately small contribution to firm profits. I agree that the size of the client is important; everyone wants to serve larger clients.

I am all in favor of seeking larger clients with more money and more interesting challenges. This effort, however, must be balanced to assure that the firm doesn’t wind up with only a few clients, larger though they may be, who put the firm at risk if they should leave.

But, be sure that no long-term capital or other expenditures are made at the behest of such larger clients without some type of assurance or guarantee that the business will stay with you until at least the amortization for the new expenditure is completed. In the longer term, a strategy based on fewer, larger clients will almost always lead to disaster.


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