Top 4 Challenges a Small Law Firms Has to Overcome on Its Path to Success

Top 4 Challenges a Small Law Firms Has to Overcome on Its Path to Success

Photo by Pixabay:

Small law firms struggle with obstacles different from what big law firms might battle with. For example, a small law firm might only employ two to 10 lawyers, but the fewer workers often lead to a unique set of challenges that a large law firm won’t face. Let’s look at the biggest challenges that small law firms face and how to overcome them.

#1: Wasting Time on Administrative Tasks

Due to fewer employees, administrative tasks fall on the lawyers and paralegals to complete them. That can eat up 40 percent of your time. In other words, you lost 40 percent in potential profits.

Easing the administrative burden was a problem for 74 percent of lawyers, according to the Small Law Firms survey. A further 20 percent of law firms call it a significant challenge.

What can you do about it? Most small law firms turn to technology to manage their administrative tasks better. Look for technologies that focus on easing your administrative burden. Some of the available technologies that can help with this include:

  • Cloud-based legal calendars
  • Practice management software
  • Mobile applications

#2: Issues with Bill Collection

When a client has issues with the bill, it becomes your issue—because you may not get paid. An estimated 53.9 percent of small law firms struggle to collect the bill from clients. Some of this has to do with an inefficient system, but other times, it has to do with a struggle on the client’s end.

How do you address it? Many small law firms invest in legal billing software to collect payments on time efficiently. You can use it to automate billing to make it much faster and lower the administrative burden.

What about when the client can’t pay? We have found how law firms that switch to a flexible payment plan will have a much easier time getting their money from clients. Small law firms can increase their client pool in this way as well.

#3: Controlling Costs

The overhead costs at a small law firm will take more out of them than a large law firm. For best practices law firm management, learn how to control your costs better. You need to learn where to spend and where to save to keep your law practice afloat.

Let’s take a look at the best practices to cut costs:

  • Reduce salaries—a last resort
  • Eliminate less important benefit programs
  • Outsource less important services
  • Renegotiate lease for a lower rate
  • Review marketing investments
  • Develop a budget

Once you eliminate wasteful spending practices, look for easy ways to increase revenue. Decreasing your costs will directly impact your spending.

#4: Client Pressure, More for Less

Small law firms already must navigate troubled waters compared to large law firms. Another big issue that small law firms face is clients who want more for less, cutting profits. Especially when desperate for clients, you may struggle to negotiate a better price.

Clients today are better informed and will compare the services that they receive from one law firm over to the next.

How do you address a competitive world where other law firms will undercut your price? To deal with this issue, raise your service quality so that they can’t get the same quality from the other law firms even if they charge less.

Good communication promotes a positive relationship with clients. Deliver personalized customer service, communicate frequently, and set the right expectations.


This shows you some ways to overcome the most common issues facing small law firms. First, take action and advise your clients without legal jargon. Winning more clients to your law firm will help you to grow, but they will also begin to see you as an authority in your field. One of the best strategies for a small law firm is to become a member of an industry association. By doing so, you can differentiate your small firm from large competitors. In addition, by joining an industry association, you can reach out to clients in that industry. Moreover, external management might help you gain a competitive advantage, especially in the beginning—food for thought.