“To increase revenue whilst saving, boutique law firms can look into collaborations and joint venture advertising. Since boutique law firms are often specialised, they could combine their offering with another boutique law firm or another professional service that serves the same target market,” she said.

“For example, corporate law and accountants or family law with mortgage brokers. Client referrals through creating a referral program is another great option as it is economical and very effective. Another option, is to host an information evening where you can show that you are a subject matter expert. It will require time and effort plus a small investment but the return is usually significant.

“If this then creates an influx in work that the law firm cannot manage, hire temporary employees or independent contractors until you can see the consistency. For administration and research overload, hire students as interns.”

Such approaches are preferred at this point in time, Ms Lesley outlined.

With the stimulus and support that was provided by the government over the past year for both businesses and individuals ceasing, she said, “we are starting to see people monitor spending more and more”.

“The seemingly everlasting uncertainty we currently have is also contributing to this. Right now, people are looking for trust and reliability more than ever,” she noted.

All boutique law firms, she continued, should be using financial ratios and key performance indicators to track progress.

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“Whether a law firm is wanting to grow or not, they need to monitor their finances simply for sustainability and longevity,” Ms Lesley said.

“Law firms, in particular, need to keep track of their unbillable time whilst assessing profitability ratios, solvency ratios and efficiency ratios. Depending on the size or your law firm and the stage of the business cycle you are in, you should be assessing aspects of your financials anywhere from weekly to monthly.”

Ultimately, cash flow will improve a firm’s capacity to allow timely payments to all stakeholders, and will also help ensure more profit for the business as a whole, she opined.

“This will allow partners to decide whether they would like to earn more personally from the profits or invest in company growth, whether it be hiring employees, paying for advertising, increasing assets etc.,” she explained.

What boutique firm owners must remember, Ms Lesley concluded, is that “even the best, most experienced lawyer” will be unable to run a successful law firm if it is not fiscally viable.

“For the law firm to be sustainable, it needs to be treated as a business first,” she said.

“Unfortunately, if you do not make sure the company’s financials are in order, you will not be able to help any clients with their matters, regardless of the lawyers’ legal capabilities.”