A Survival Guide for Legal Practice Managers

A Survival Guide for Legal Practice Managers

Innovative payment technologies and how your business can benefit

Tuesday, April 25, 2017

Compu-stor ad

By Bessie Hassan, Money Expert, finder.com.au


New payment innovations have created a cashless society where customers can now make payments using their wallets or mobile devices. As these modern payment methods become the norm, it’s essential that businesses adapt quickly in order to remain competitive.

Whether it’s contactless payments, mobile wallets, or providing the infrastructure for in-store finance, there are now multiple ways customers can make transactions to suit their needs and it’s up to businesses to make these readily available.

While these payment technologies provide greater convenience for the customer, they also provide businesses with higher conversion rates and rich insights related to customer behaviour. Combined with this, the payment methods also allow businesses to provide a higher level of customer service with greater security.

Here are a few new ways to pay, and how your business can benefit.

1) Higher conversion with interest-free payments & in-store finance


Providing interest-free payments means your customer can make purchases either online or in-store that they pay back interest-free. Both Afterpay and Openpay have partnered with countless retailers, so it’s worth jumping on board if you haven’t already done so.

With in-store finance, you can partner with credit providers or you can offer your own finance in-store. For instance, you can promote credit offers such as CreditLine from Latitude Finance that’s currently available at several retailers.

Having the option of interest-free payments and in-store finance could see your sales volume grow as customers may be more likely to convert. It removes friction of a complicated and lengthy checkout process and providers customers with the resources to complete a transaction.

2) Value-add with ‘tap and go’ mobile payments 

Updating your payment technology to accept contactless and mobile payments is a good way to appeal to customers’ changing spending habits.

This is how it works: for purchases valued under $100, customers can ‘tap and go’ using their debit or credit card, and if they have Apple Pay or Samsung Pay, they can pay using their mobile phone.

There are some features of mobile payment systems that provide you with valuable information, such as WAP billing. Online purchases made through WAP billing can provide richer media to customers such as games and apps, and it can provide additional features including previews and delivery details. Providers such as Bango and Netsize are the most common players in this space.

3) Tailored marketing with digital wallets


As you can access consumer’s credit card information, shipping address, and other payment data, supporting mobile payments will give you greater consumer behaviour insights.

What’s their preferred payment method? How much are they spending, on average? Where do they live? This information can help you target your marketing communications at a higher level which allow for a more efficient allocation of resources.

In the next few years, new payment methods will only become more advanced so it’s important that you’re across new developments in this area. Whether it’s providing in-store finance options through instalment plans or providing the technology to facilitate mobile phone payments, there are many ways you can embrace new payment methods to provide a superior customer experience and reap the financial benefits.

About our Guest Blogger


Bessie HassanBessie Hassan is the Head of PR Australia and Money Expert at finder.com.au - Australia's most visited comparison site - and often features on national radio, TV, and throughout online publications sharing her best money-saving hacks and property advice. Bessie is passionate about helping Australians find better, whatever it is they're looking for.








Marketing for the modern firm

Tuesday, April 18, 2017

Compu-stor advert


By Rafe Berding, Manager of Brand and Communications, GlobalX


Many traditional law firms continue to rest on their laurels and well earned goodwill when it comes to generating new business. However, more than ever firm growth and new client acquisition can be attributed to having a sound digital marketing strategy. Whether you work in a top-tier or boutique firm, these strategies are integral to assist in driving continuous business development and growth.

In saying this, digital strategies are not autonomous in their application, and must be collaboratively combined with traditional marketing elements to achieve true multi-channel marketing communications.

Indeed, the Australian legal landscape is continuing to evolve faster than ever, with innovation in the sector delivering challenges and opportunities at every corner. The emergence of new technology and integration capabilities is presenting disruption as we adopt and change. Technology is also changing the way we offer legal services, creating new forms of competition and changing client expectations on how we do business.

That said, law firms must also stay on top of the latest ways to reach clients and showcase their unique value proposition.

Multi-channel marketing to the modern-day consumer


Both traditional and digital marketing must be implemented as a unified strategy.

Multi-channel marketing and communication establishes a broad presence across a myriad of platforms to reach prospective clientele. With Australians consuming more information than ever across multiple platforms in shorter cycles, it is essential we have targeted and diverse marketing and advertising activities.

5 tips to boost your multi-channel marketing communications


1. Be Present – Have an online presence


If you haven’t already built an online presence for your business, it’s time to start. Having an online presence is critical for your business - no matter how large or small. It is imperative you have a modern website that reflects your brand, it is up-to-date with your services, contact details and overall unique value proposition.

2. Be reached – Invest in Search Engine Optimisation (SEO)


There is no point in having the best website and social media platforms in town when you have no traffic being directed to your brand. To put it in perspective Google processes over 40,000 search queries every second, which translates to over 3.5 billion searches per day and 1.2 trillion searches per year.

Approximately 90% of consumers use search engines to research a product or business. Here is a breakdown of the search engines used.

Australian Search engine usage snapshot:

Google: 94.4%

The rest: 5.6%

To ensure you are ranking on page 1 of Google or any other search engine for that matter you need to invest in Search Engine Optimisation (SEO).

What is SEO?

Search Engine Optimization (SEO) is the process of influencing the visibility of your website in a web search engine's unpaid results — often referred to as "natural," "organic," or "earned" results. In layman's terms this means being higher up the search results listing, preferably at the top of page 1!

Find out more by visiting Google’s free Search Engine Optimisation Starter Guide.

3. Be Social – Implement Social Media


With over 65.8% of the Australian population actively using Facebook each month it is important your business is set up on the social media platforms your clients use.

*Australian Social Media usage:

  1. Facebook – 16,000,000 active users

  2.  Instagram – 5,000,000 active users

  3. LinkedIn – 3,600,000 active users

  4. Twitter – 2,800,000 active users

Setting up social media accounts for your business are free and easy to do.
Learn how you can set up a free Facebook business Page in a matter of minutes, from a mobile device or a computer.

*All figures represent the number of Unique Australian Visitors [UAVs] to that website over the monthly period – unless otherwise stated above. Source – SocialMediaNews.com.au

4. Be consistent with your message - Have a Communication Strategy


Having a web and social presence is one thing, but consistent and palatable content via these platforms is the kicker. A mix of thought and industry leadership, product and service announcements and telling your business story is essential across all platforms.

Planning and measurability of this regular content ensures consistency and that you understand the mix, message and value. Communication is constant through technology. Because of this, information should never be delayed in getting to its intended recipient. Providing consistent and current communication means your clients will stay informed and educated. In return, your business will earn their respect, trust and opportunity to win their business.

5. Be agile with paid promotion – boost your digital presence as required


AdWords
Once you have established your web and social media presence and have your content strategy in place you have the option to boost your visibility with paid promotion or advertising.

AdWords is an advertising service by Google for organisations wanting to display ads based on key words to get to the top of search results on Google. The Adwords program enables you to set a budget, with users only paying when people click on the respective ads.


LinkedIn
LinkedIn offers the ability for you to promote or “sponsor” posts.

These campaigns are on a Pay Per Click (PPC) basis and can be easily targeted or displayed based by several demographics:

  • Location
  • Age
  • Company – by name or category (industry or size)
  • Job Title
  • Education
  • Skills
  • Group – all or a particular group, or exclude
  • Gender

Facebook

Facebook offers businesses “Promoted Posts,” these are an advertising option enabling the promotion of selected posts.

A Promoted Post is like any other regular post made on your Facebook business Page. From there you set a budget on a Pay Per Click (PPC) model. The post will then be shared and promoted to a set number of Facebook members.

Embrace digital tools to your advantage


Australia’s legal services market continues to change with the advent of modern-day technology. Today’s technology is indelibly changing the way we do business - from the services we offer, our pricing structure, all the way to how we communicate and prospect for new business.

Equally, our customers’ behaviour is dramatically changing from the way they appoint us, to the way in which the relationship communicates. By leveraging the latest digital tools and strategies in conjunction with traditional marketing and business development activities you can ensure your business is in the best position to be present, reachable and relevant.


About our Guest Blogger



Rafe BerdingRafe Berding is Manager of Brand and Communications at GlobalX. GlobalX is one of Australia’s leading technology and legal support services companies - developing and supporting workflow software solutions for conveyancers and lawyers including Matter Centre and Open Practice.

GlobalX’s online, software and legal support services are used by thousands of law firms across the nation each day. Rafe is part of a team of 250 dedicated professionals driving technological and industry change to empower the daily productivity of Australia’s leading legal professionals.







A powerful, cost-cutting IT solution for legal firms

Tuesday, April 11, 2017
Compu-stor advert


 By Shane Muller, Founder and Managing Director, OBT


With the rise of the digital transformation, “disruption” has become the new norm in the legal industry. But often, the biggest innovations come from improving, and “future proofing,” current systems. Savvy legal firms are doing just that, by adopting virtual IT solutions that cut costs, streamline operations and provide remote access securely. Gone are the days of enterprise solutions laden with features that staff simply don’t use.

Demand has made Desktop-as-a-Service (DaaS) a $30 billion worldwide market, and it’s only going to grow as enterprise platforms continue to drain IT budgets. More businesses in the legal space are embracing app and desktop virtualisation to give them a competitive edge in the rapidly changing legal landscape.

Here are 4 reasons why legal firms are making the shift to DaaS—and saving time and money in the process.

Streamlined pricing



DaaS is priced using a simple subscription model. Firms get predictable monthly costs, without the capital expense and time required to build everything yourself. In fact, businesses report 70% savings when using low-cost, thin clients to replace outdated PCs. Free yourself from costly enterprise platforms, and free up budget for more important undertakings in the process.

Simplicity



Enterprise solutions often require costly training, as well as an army of IT support staff to troubleshoot when something goes wrong. This takes away time and resources from more pressing projects and growth priorities. With DaaS, application updates are handled automatically and security is built into the solution.

Accessible, secure information



Private IT solutions silo information to devices. When devices are lost, all of the data is lost, too. Virtual desktops store everything securely in the cloud, which means the teams you manage have the freedom to work where they want, at the office or from home—without the risk of data breaches.

Flexibility



To grow and meet demand, businesses need IT solutions that provide agility. Being flexible saves you money by allowing you to scale up or down to match your firm’s current demand. DaaS provides firms with the flexibility to add applications and users at a moment’s notice.

As the legal industry embraces the digital transformation, four capabilities will hold the key to success: ability, stability, affinity and agility. To stay agile in the new tech landscape, firms are opting for a streamlined solution that maximizes budget, security and productivity.

About our Guest Blogger


Shane MullerShane Muller is a business industry pioneer who has more than 25 years’ experience in the IT industry. Since Shane established OBT in 1999 it has grown exponentially to become a leading private cloud services provider. OBT is a multiple winner of the Microsoft Australian Hosting Partner of the Year award, and the 2017 CRN Impact Award for Optimising Investments. Shane is married and in his spare times enjoys the outdoors, fine wine and his involvement in a range of community activities.









How do you financially rate your firm?

Tuesday, April 04, 2017

ICON visual marketing ad


By Andrew Chen, Partner - Business Advisory, Crowe Horwath


“On a scale of 1 to 10 how would you rate the financial performance of your firm?” 

It is interesting the variety of responses that I receive when I ask partners and firm management this question and then ask them “why?”.

Typically, the responses are given in the context of the current economic conditions the firm is facing, internal issues or a partner’s objectives.

How would the partners of your firm rate the financial performance of the firm? Do some of the following responses sound familiar?

  • We grew revenue by 10% again
  • Partner profits exceeded expectations at $600,000 per partner
  • The firm was valued at $5 million
  • Staff productivity is at 85%
  • Profit per point is on budget
  • Cashflow is great our firm lock-up is now 60 days.
  • We just hired a new a partner and opened a new office in Brisbane

In contrast, for a firm not travelling financially well, the responses typically centred around the firm not meeting budgeted fees, the reasons why and the level of partner profit draws not being quite where they should be.

Understanding how your firm rates financially is important so that you know the true financial picture. This can be achieved by using a composite of measures that highlight the strengths and weaknesses of the firm, but also provides the firm with actionable insight to change its future direction.

Most firms produce monthly and annual financial statements including a Profit and Loss Statement and a Balance Sheet in order to comply with tax and other record keeping requirements. But we tend to analyse them in isolation, and track measures specific to particular balances or reports. While there is nothing wrong with that in itself, it does not show the true picture of a firm’s performance.

It is important to analyse the financial relationship between a profit and loss and balance sheet together to truly know how your firm financially rates.

I have come across a number of similar instances where a partner has said: “The profit per partner was $350,000 and we had a great year, but each partner had provided effectively $800,000 of equity funding to the firm”. In my book, that’s not a particularly good outcome.

Create a firm scorecard



Create a firm scorecard with your firm’s key KPI’s with targets and compare them to benchmarks from the recent ALPMA/Crowe Horwath Financial Performance Benchmarking Study ‘Financially propelling innovation & growth’. From the results summary,you can rate the performance of your firm, and assess if it is above expectations or performs poorly.

1) Gross Profit Margin % (GP)



I was quite surprised at the number of firms that do not budget or report their gross profit margins. This may have something to with how a firm’s accounting system and payroll systems are initially set up, and an acceptance of the reporting produced by these systems.

It is an ideal measure to see how profitable the firms legal service are produced, which then should direct you to whether you can afford those pay rises, increase productivity or change staff mix or simply need to grow fees.

The recent ALPMA/Crowe Horwath Benchmarking study results indicate that the average GP in June 2016 was 57.8% and it has hovered around this percentage for the prior 3 years.

2) Profitability % (before interest and tax)



Everyone looks at the bottom line, but not always before interest and tax. This measures the operating performance of the firm as a return on revenue. It enables your firm to be compared to the performance of other firms regardless of how the firm is funded.

3) Return on the funding capital %



This measure is also commonly known as the return on capital employed. [Profit before Interest & Tax / (Working capital + Non-Current Assets)]

Is the profitability percentage an adequate return for the amount the partners have invested in the firm and the firm has borrowed from the bank? If the answer to this question is no, then this could be a reflection of large work in progress and debtor balances, low gross profit or excessive overhead costs.

This measure provides your firm visibility on whether the partners are leaving excessive profits in the firm; bank debt is growing due to poor working capital management of WIP and debtors; or whether there is a committed investment for growth.

4) Revenue generated on funding capital % (Financial Resilience Index)



We see this measure as an indicator of a firm’s financial resilience and how effectively the firm is able to grow fee revenue off the back of the funding from the bank and the partners. That is the firm’s ability to support fee growth with no extra funds from the bank or profits left in the firm by the partners. On average, firms in the ALPMA/Crowe Horwath study generated for $2.7 of fee revenue for every $1 of funding.

Increasing the value of the firm

 

If these four key measures are moving in the right direction year on year, the value of the firm increased which is a reflection that the firm’s strategic plans are working!

Other measures and indicators improved such as lock-up days, partner draws increased, bank debt reduced and overheads were contained.

For participants in the ALPMA/Crowe Horwath study that rated highly in the above four measures relative to their peers, it was no surprise that the results also showed they were being innovative and were also investing in marketing campaigns and new technology.

How does your firm financially rate on these measures?

Editor's Note


2016 Financial Performance Benchmarking Study Results
For further insights, download the results summary from 2016 ALPMA/Crowe Horwath Financial Performance Benchmarking Study of Australian Law Firms, "Financially Propelling Innovation & Growth".













About our Guest Blogger


Andrew ChenAndrew Chen is a Partner of Crowe Horwath’s Business Advisory team and has provided business advisory, taxation and accounting services to a broad range of clients for 25 years.

Andrew helps business owners identify key financial issues affecting their businesses and then develops tailored solutions to make their businesses more profitable and sustainable.

Andrew’s significant experience in advisory and tax accounting services comes from working with businesses of all sizes. He specialises in advising legal and professional service firms on establishing business structures; financial management in areas of internal accounting functions and tax administration; financial reporting and KPI performance measurement; budget and cash flow forecasting; tax planning; salary packaging; and tax return preparation.

Andrew is a regular speaker on financial management and taxation issues at industry events. He was a key speaker for Macquarie Bank’s National Legal Firm roundtables. Andrew lectures at the College of Law and also contributes to industry publications including those for the Australian Legal Practice Management Association and Australian Dental Association.



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