Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Accounting and Financial Planning for Law FirmsFeaturesLaw Firm ManagementLaw Firm Marketing and Business DevelopmentLegal Operations

The Business Benefits of Leasing When Combatting the Increasing Costs of Operating a Firm

By Mike Henderson, Whitney Jones and Bill Pitcairn
July 01, 2023

The cost of operating a law firm is becoming more expensive. From increases to associate pay, to rising costs of recruiting, to the additional costs of hybrid operations and increased cyber security needs, there's a variety of reasons as to why overhead expenses have been steadily increasing quartile by quartile, with Q1 of 2023 ending at an 11.7% increase, according to the Citi Law Firm Group Q1 2023 Report.

Even more challenging is that — for most firms outside the top 50 — incoming revenue is not meeting this steady increase in expenses. This year as of the end of Q1 2023, expenses were outpacing revenue by 6.3% across the industry, mainly for firms outside the top 50 firms which reported revenues outpacing expenses through record breaking rate increases, according to the Citi report.

While challenging overall, firms are stable, profitable businesses posting solid profitability projections through the end of 2023 — but not quite breaking the records as was the case in 2020 and 2021. Profitability is important, however, when recruiting high value laterals into the firm, and so protecting every inch of the firm's margin is key — especially when the macroeconomic outlook is volatile with whispers of recession and a heated political environment heading into the fall.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Overview of Regulatory Guidance Governing the Use of AI Systems In the Workplace Image

Businesses have long embraced the use of computer technology in the workplace as a means of improving efficiency and productivity of their operations. In recent years, businesses have incorporated artificial intelligence and other automated and algorithmic technologies into their computer systems. This article provides an overview of the federal regulatory guidance and the state and local rules in place so far and suggests ways in which employers may wish to address these developments with policies and practices to reduce legal risk.

Is Google Search Dead? How AI Is Reshaping Search and SEO Image

This two-part article dives into the massive shifts AI is bringing to Google Search and SEO and why traditional searches are no longer part of the solution for marketers. It’s not theoretical, it’s happening, and firms that adapt will come out ahead.

While Federal Legislation Flounders, State Privacy Laws for Children and Teens Gain Momentum Image

For decades, the Children’s Online Privacy Protection Act has been the only law to expressly address privacy for minors’ information other than student data. In the absence of more robust federal requirements, states are stepping in to regulate not only the processing of all minors’ data, but also online platforms used by teens and children.

Revolutionizing Workplace Design: A Perspective from Gray Reed Image

In an era where the workplace is constantly evolving, law firms face unique challenges and opportunities in facilities management, real estate, and design. Across the industry, firms are reevaluating their office spaces to adapt to hybrid work models, prioritize collaboration, and enhance employee experience. Trends such as flexible seating, technology-driven planning, and the creation of multifunctional spaces are shaping the future of law firm offices.

From DeepSeek to Distillation: Protecting IP In An AI World Image

Protection against unauthorized model distillation is an emerging issue within the longstanding theme of safeguarding intellectual property. This article examines the legal protections available under the current legal framework and explore why patents may serve as a crucial safeguard against unauthorized distillation.