Cutting costs as a way to improve the bottom line in the law office
Warren Buffett (one of the world’s richest persons) operates a company called Berkshire Hathaway which was a textile manufacturer and now owns many businesses that you would know such as See’s Candy, Dairy Queen Ice Cream, the Pampered Chef, and GEICO Insurance to name a few.
Mr. Buffett takes a “hands off” approach to running the large corporation and leaves the running of the businesses to the managers of the individual businesses. The only requirement that the parent corporation has for the owned businesses is that they grow in profitability at 15% per year.
This 15% hurdle can be achieved by growing the revenue of the business by 15% or by decreasing costs by 15% or some combination of the two techniques. The reason I mention this is that in order to grow our businesses, we often think about bringing more clients and money into the office, but we forget that by cutting costs, the same goal is available. The goal is to have more profit at the end of the month. Mr. Buffett has grown Berkshire Hathaway by this method and we can use it as well. So from time to time I will be teaching cost cutting techniques for Building your Bankruptcy Business.
Cost Cutting Ideas
Quality Control for Bankruptcy Petition
The nature of the Consumer bankruptcy business is that the flat fee earned does not allow for extra time and effort on the petitions once the bankruptcy petition is filed. If amendments have to be done after the filing of the original paperwork, this takes time and staff effort which is difficult to recoup from a client. The goal then is to be a efficient as possible so that re-work does not have to be done.
One efficiency method I have seen is to have two people do a “Quality Control” review on each petition. Usually one staff person works on a petition with the client and assists the attorney with signing of the paperwork. As it is difficult for a person to proof read his own work, mistakes often slip through. This mistakes are usually caught by the trustee and amendments are asked for at the meeting of creditors and cases are needlessly continued.
In the “Quality Control review” method, one person still prepares the petition from the office and gets the petition ready for filing. Prior to the filing, another person does a quality control review prior to the filing. The second person goes over the entire petition with fresh eyes. This “double check” often finds minor and major problems with the petition and schedules that can be fixed prior to the filing. While it takes extra effort to go over a petition twice, it saves time and money in the long run and increases the profit for you office by not having to do needless double work.