Disclaimer
The publisher of this newsletter is not engaged in rendering legal, accounting, financial, investment advisory or other professional services, and this publication is not meant to constitute legal, accounting, financial, investment advisory or other professional advice. If legal, financial, investment advisory or other professional assistance is required, the services of a competent professional person should be sought.
Improving Law Firm Profitability Without Working Longer Hours or Raising Rates
Last month, in Part One of this article, I discussed three major approaches to enhancing law firm profitability: expanding your client base; assertively managing billing, receivables and payables; and unbundling operating costs from bills for fees. Previously, in the August 2003 edition of this newsletter, I described a fourth major profitability approach: management of alternative billing strategies. This month's article concludes my overview of profitability improvement methods by summarizing 10 more techniques.
Selling a Law Practice: Prospects and Pitfalls
Large firms have long had well-defined methods for transferring ownership interests in a practice via "mergers," "retirements," "breakups," etc. Attorneys in larger firms have also always had mechanisms in place that provided them and their heirs with funding for the value of their individual interests in the firm. By contrast, the outright "sale" of a law practice from one attorney to another was prohibited for decades. In 1991, however, the ABA dropped its opposition. California had already permitted such sales since 1989, and more states have now followed suit; so the mechanisms for selling a practice have been developing, albeit slowly. These changes are economically vital for small-firm and sole practitioners. Many of these attorneys tend to conclude their law practice without any transfer of ownership, by just closing their office doors one day and never returning. By doing so, an attorney forgoes "cashing in" on a valuable asset that has taken many years to build. That no longer has to happen. Like their counterparts in large firms, sole and small-firm practitioners ' and their heirs ' can now reap the rewards of years of effort. This levels the economic playing field for retirement and estate planning.
Tenant Concerns When Drafting Accessibility and Visibility Protection Provisions
Often in leases, particularly retail leases, the tenant seeks to protect the accessibility and visibility of the area immediately in front of its store location. For that purpose, landlords and tenants create language that prevents the landlord from placing any retail operation, structure or obstruction in front of the tenant's store within a certain number of feet or a designated area in the common area (often referred to as a "Restricted Area"). However, very often due to the vagueness of the language included in this type of a provision, as well as due to the limited nature of remedies available in this type of a provision, the tenant does not receive the type of accessibility and visibility protection that it thought it had negotiated. As a result, tenants should consider the following factors when negotiating accessibility and visibility protection provisions in their retail leases: (i) include a picture or site plan designating the "Restricted Area"; (ii) identify any specific remedies attributable solely to this provision; and (iii) limit competing uses for stores in the Restricted Area, if the existing retail tenants in the Restricted Area ever relocate from their existing locations or vacate the retail facility.
