Law Firm Business Plan Template
If you want to start a Law Firm or expand your current Law Firm, you need a business plan.
The following Law Firm business plan template gives you the key elements to include in a winning Law Firm business plan.
Law Firm Business Plan Example
I. Executive Summary
Business Overview
[Company Name] is a law firm in [insert location here]. The Company primarily focuses on litigation law, but also provides a wide range of legal services as requested by clients. [Company Name]’s legal services range from mergers and acquisitions to product liability, to intellectual property to real estate. Our team of lawyers works with each client to ensure successful outcomes. The Company’s goal is to become one of the leading law firms in the area.
Services
[Company Name] will provide the following legal services to its clients:
- Arbitration & Mediation
- Business Formation
- Business and Commercial Transactions
- Collections and Credit Matters
- Commercial Real Estate Law
- Construction Law
- Corporate Governance and Compliance
- Creditor’s Rights
- Employment Law
- General Counsel Services
- Immigration Law
- Insurance Law
- Real Estate Consultancy and Advisory Services
Customer Focus
[Company Name] will primarily serve service sector businesses and individual clients within a 20-mile radius of its location. Potential customers in this area include:
- 1,500 private businesses with annual payroll exceeding $1 million
- 120,000 individuals
Management Team
[Company Name] is led by [Founder’s name], who has been in the legal industry for [x] years. [Founder’s name] graduated from the University of ABC, where he majored in law. During his apprenticeship in the legal industry, he acquired in-depth skills in practicing law and is well aware of the practices related to the legal industry. Additionally, he worked in a law firm alongside a professional, learning how to manage and run a law firm before starting [Company name].
Success Factors
[Company Name] is qualified to succeed due to the following reasons:
- There is currently a high demand for legal services within the community. In addition, the company surveyed the local population and received highly positive feedback pointing towards an explicit demand for the services, supporting the business after launch.
- The Company’s location is in a high-volume traffic area and will thus be highly convenient for a significant number of people visiting nearby.
- The management team has a track record of success in the legal business.
- The upscale legal business is a proven business and has succeeded in communities throughout the United States.
- Market trends such as high disposable income and spending power are propelling the demand for legal services.
Financial Highlights
[Company Name] is currently seeking $170,000 to launch its law firm. Specifically, these funds will be used as follows:
- Office design/build: $60,000
- Working capital: $110,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Top line projections over the next five years are as follows:
| Financial Summary | FY 1 | FY 2 | FY 3 | FY 4 | FY 5 |
|---|---|---|---|---|---|
| Revenue | $560,401 | $782,152 | $1,069,331 | $1,379,434 | $1,699,644 |
| Total Expenses | $328,233 | $391,429 | $552,149 | $696,577 | $776,687 |
| EBITDA | $232,168 | $390,722 | $517,182 | $682,858 | $922,956 |
| Depreciation | $7,000 | $7,000 | $7,000 | $7,000 | $7,000 |
| EBIT | $225,168 | $383,722 | $510,182 | $675,858 | $915,956 |
| Interest | $6,016 | $5,264 | $4,512 | $3,760 | $3,008 |
| Pre Tax Income | $219,152 | $378,458 | $505,670 | $672,098 | $912,948 |
| Income Tax Expense | $76,703 | $132,460 | $176,985 | $235,234 | $319,532 |
| Net Income | $142,449 | $245,998 | $328,686 | $436,864 | $593,416 |
| Net Profit Margin | 25% | 31% | 31% | 32% | 35% |
II. Company Overview
Who is [Company Name]?
[Company Name], located in [insert location here], is a new, upscale law firm that provides a wide range of legal services to both individual and business clients. The Company has built an impressive reputation for providing superior legal advocacy and delivering consistently exceptional results to the area’s companies, businesses, and professionals. As a solution-oriented law firm, the Company makes it their primary objective to support, guide, and protect their clients.
[Company Name]’s History
[Founder’s Name] is an entrepreneur who has worked extensively with law firms & lawyers to enhance his business development skills on a personal and commercial level. He has restructured the firm to keep pace with the legal developments in the regional and international community by creating ethical, legal practices with a highly qualified legal team focusing on providing comprehensive, professional, and creative legal solutions to fully meet the confidence and expectations of the clients locally and internationally.
Upon surveying the local customer base and finding the potential retail location, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].
[Founder’s Name] has selected an initial location and is currently undergoing due diligence on each property and the local market to assess the most desirable location for the Law Firm.
Since incorporation, the company has achieved the following milestones:
- Found office space and signed Letter of Intent to lease it
- Developed the company’s name, logo, and website
- Created the list of services to be offered
- Determined equipment and inventory requirements
- Began recruiting key employees with experience in the legal industry
[Company Name]’s Products/Services
[Company Name] will provide a variety of legal services ranging from mergers and acquisitions to product liability, from intellectual property to real estate. The Company’s services are listed below:
- Arbitration & Mediation
- Business Formation
- Business and Commercial Transactions
- Collections and Credit Matters
- Commercial Real Estate Law
- Construction Law
- Corporate Governance and Compliance
- Creditor’s Rights
- Employment Law
- General Counsel Services
- Immigration Law
- Insurance Law
- Real Estate Consultancy and Advisory Services
III. Industry Analysis
The market size of the law firm industry in the U.S. is expected to increase 5.3% to reach $330 billion. The law firm industry in the US is the 2nd ranked professional services industry by market size in the US.
Growth in the historic period resulted from strong economic growth in emerging markets, increased mergers and acquisitions (M&A), a rise in consumer spending/increase in disposable income, and deregulation of the legal industry. Moreover, increasing demand for transactional practice areas, the growing legal tech industry, and globalization will drive the growth.
The increasing number of transactional practices in the upcoming period is expected to drive the legal services market. Transactional practice includes research, preparations, and review of documents for individuals and companies for corporate, tax, and real estate work and mergers and acquisitions.
IV. Customer Analysis
Demographic Profile of Target Market
[Company Name] will provide its services to businesses within a 20-mile radius of its location.
The following numbers of businesses operate within 20 miles of our headquarters:
| Total Businesses | 38,124 |
|---|---|
| Forestry, Fishing, Hunting, and Agriculture Support | 0.29% |
| Mining | 0.35% |
| Utilities | 0.23% |
| Construction | 9.64% |
| Manufacturing | 4.16% |
| Wholesale Trade | 5.62% |
| Retail Trade | 14.54% |
| Transportation and Warehousing | 2.83% |
| Information | 1.81% |
| Finance and Insurance | 6.56% |
| Real Estate and Rental and Leasing | 4.75% |
| Professional, Scientific and Technical Services | 11.36% |
| Management of Companies and Enterprises | 0.69% |
| Admin, Support, Waste Mgt, Remediation Services | 5.15% |
| Educational Services | 1.20% |
| Health Care and Social Assistance | 10.80% |
| Arts, Entertainment and Recreation | 1.66% |
| Accommodation and Food Services | 8.59% |
| Other Services (Except Public Administration) | 9.78% |
Customer Segmentation
The Company will primarily target the following customer segments:
- Individuals: [Company name] will target individuals who require assistance in terms of legal processes.
- Businesses: The Company will provide its services to businesses within a variety of sectors that require legal consulting services in [Location].
V. Competitive Analysis
Direct & Indirect Competitors
Gold Law Partners
In business for 15 years, Gold Law Partners is a leading full service/multi-disciplinary law firm offering transactional, regulatory, advisory, dispute resolution services. With its principal offices in Washington and New York, the firm advises a diverse clientele, including domestic and international companies, banks and financial institutions, funds, promoter groups, and public sector undertakings.
The Company was set up with a desire to bring client service into sharper focus, to provide commercially viable legal advice and committed legal representation to the clients across all sectors. The firm has successfully been able to establish its identity outside its origins, dealing with significant depth in complex domestic and international matters.
Premiere Legal
Premiere Legal is an international full-service legal practice that serves the needs of many of the largest multinational corporations. The company aims to combine the highest international standards with local expertise so it can provide seamless assistance to the top corporations in their most important and challenging assignments. Through the network, the company offers a full range of commercial legal services, combined with an in-depth knowledge of local practices, in a total of 18 countries in four continents, including some of the most challenging and fast-growing emerging markets.
R&R Legal
R&R Legal is a growing consortium of local law firms, providing a consistent standard of outstanding legal expertise and a considerate, personal service to clients throughout the US. Whenever required, the company will suggest input obtained from specialist barristers and other suitably qualified third-party advisors. The company has good relationships with many accountants, barristers, estate agents, bankers, surveyors, and other professionals, both locally and further afield. This adds depth to the service the company would provide when support and collaboration are needed.
Competitive Advantage
[Company Name] enjoys several advantages over its competitors. These advantages include:
- Management: The Company’s management team has xx years of business, legal consulting, and marketing experience that allows them to market and serve customers in an improved and sophisticated manner than the competitors.
- Relationships: Having lived in the community for xx years, [Founder’s Name] knows all of the local leaders, newspapers, and other influencers. As such, it will be relatively easy for [Company Name] to build brand awareness and an initial customer base.
- Great service at an affordable price: The wide range of legal consulting services offered by [Company Name] nearly equals the most prestigious positioned competitor, [Competitor Name]. However, [Company Name] will offer its services at a much more affordable price.
- Personal Service: The Company will tailor its service to the client’s requirements. Individuals can choose the way they wish to communicate with us either by email, phone, or fax, and the company will work closely with you to achieve the best result for individuals or the business.
VI. Marketing Plan
The [Company Name] Brand
[Company name] seeks to position itself as a renowned, upper-middle-market competitor in the law firm industry. Customers can expect to receive effective and efficient legal consulting services.
The [Company Name] brand will focus on the company’s unique value proposition:
- Expert Management Team
- Industry Relationships
- Great Services at an affordable price
- Providing excellent customer service
Promotions Strategy
[Company Name] expects its target market to be residents and service sector businesses within a 50-mile radius of the [location]. The Company’s promotions strategy to reach the audience includes:
Website
The Company will create a professional website for domestic and international business prospects, which will provide easy access to essential information about the company offerings, contact details, and other information. The website will be updated and optimized to enhance the company’s online presence.
Advertisement
Advertisements in print publications like newspapers, magazines, etc., are an excellent way for businesses to connect with their audience. The Company will advertise its offerings in popular magazines and news dailies. Obtaining relevant placements in industry magazines and journals will also help in increasing brand visibility.
Public Relations
[Company Name] will hire an experienced PR agency/professional(s) to formulate a compelling PR campaign to boost its brand visibility among the target audience. It will look to garner stories about the company and its offerings in various media outlets like newspapers, podcasts, television stations, radio shows, etc.
Social Media Marketing
Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The Company will use social media to develop engaging content in terms of different jewelry designs and post customer reviews that will increase audience awareness and loyalty. Engaging with prospective clients and business partners on social media platforms like Twitter and LinkedIn will also help understand changing customer needs.
Word of Mouth Marketing
[Company name] will encourage word-of-mouth marketing from loyal and satisfied clients. The Company will use recommendations and word-of-mouth marketing to grow the customer base through the network of its existing customers. The Company will be incentivizing its existing customer base to encourage their friends to come and try their service for the first time.
Pricing Strategy
[Company Name]’s pricing will be moderate, so customers feel they receive great value when availing of the services they are paying for. The customer can expect to receive effective and efficient legal services at a far more affordable price than what they pay at an already well-established law firm.
VII. Operations Plan
Functional Roles
To execute on [Company Name]’s business model, the company needs to perform several functions, including the following:
Administrative and Service Functions
- Lawyers
- Legal Aides
- General & administrative functions including legal, marketing, bookkeeping, etc.
- Executive Assistant
- Human Resources
Milestones
The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:
| Date | Milestone |
|---|---|
| [Date 1] | Finalize lease agreement |
| [Date 2] | Design and build out [Company Name] |
| [Date 3] | Hire and train initial staff |
| [Date 4] | Kickoff of promotional campaign |
| [Date 5] | Launch [Company Name] |
| [Date 6] | Reach break-even |
VIII. Management Team
Management Team Members
[Company Name] is led by [Founder’s Name], who has been in the legal consulting industry for xx years. While [Founder] has never operated a legal firm himself, he has worked extensively with domestic and international clients for different projects. [Founder’s name] graduated from the University of ABC, where he majored in law. During his apprenticeship in the legal industry, he acquired in-depth skills in practicing law and is well aware of the practices related to the legal industry.
Additionally, he worked in a law firm alongside a professional, learning how to manage and run a law firm before starting [Company name].
Hiring Plan
[Founder] will serve as the CEO. To launch the law firm, the company will need to hire the following personnel:
- Lawyers [Number]
- Legal Consultants [Number]
- Accountant
- Marketing & Sales Executive [Number]
IX. Financial Plan
Revenue and Cost Drivers
[Company Name]’s revenues will come from the legal services offered to its customers. The major costs for the company will be salaries of the staff, rewarding them for performance and making specialists will be an active part in business retention and development. In the initial years, the company’s marketing spend will be high, as it establishes itself in the market. Moreover, rent for the prime location is also one of the notable cost drivers for the [Company Name].
Capital Requirements and Use of Funds
[Company Name] is currently seeking $170,000 to launch its law firm. Specifically, these funds will be used as follows:
- Office design/build: $60,000
- Working capital: $110,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Key Assumptions
The following table reflects the key revenue and cost assumptions made in the financial model:
| Number of Clients | Average |
|---|---|
| FY 1 | 120 |
| FY 2 | 150 |
| FY 3 | 180 |
| FY 4 | 200 |
| FY 5 | 220 |
5 Year Annual Income Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
| Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
| Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
| Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
| Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
| Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
| Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
| EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
| EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
| Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
| PRETAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
| Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
| Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
| NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
| Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
| Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
| Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
| Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
| Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
| TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
| Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
| Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
| Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
| Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
| CASH FLOW FROM INVESTMENTS | |||||
| Investment | ($246,450) | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 |
| Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| SUMMARY | |||||
| Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
| Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
| Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
