Often, but not always, midsize businesses do not have internal legal departments, but are large enough that they need sophisticated legal guidance on a variety of day-to-day issues that arise. This requires midsize businesses to have a knowledgeable, experienced and cost-effective outside legal resource that supports the midsize business and its operations.
Smart Business spoke with Eric C. Springer, Managing Shareholder and Director at Sherrard, German & Kelly, P.C., about the unique legal needs of midsize businesses and what businesses should consider as they choose a law firm.
What options do midsize businesses have for getting the legal representation they need?
There are as many options as there are midsize businesses out there because one size does not fit all.
In-house counsel can provide the kind of daily legal service that is needed, but not all businesses can support the cost structure of adding this person as a full-time employee. For many companies, the better option is to develop and maintain a close relationship with one or more outside lawyers capable of addressing those issues, when needed, but without a full-time cost component.
In short-term situations or specific initiatives or transactions, the cost of outside counsel might be perceived as a more significant expense. When viewed over the long term, however, these relationships may prove less costly and more efficient for the midsize business —given the breadth and depth of knowledge, resources and practice areas available from the attorneys from a broad-based, general practice law firm.
What are some questions midsize businesses should be asking as they look to establish a relationship with a new firm?
Is the firm a fit with you, your management team and your business? Will the firm be engaged and responsive to your needs and requests? Are the attorneys knowledgeable about your business sector and the issues you tend to confront more regularly? What other practice areas and resources does the firm have that you may need? Do they work with a number of similar sized businesses in your industry?
Once that connection is made, put trust in your law firm’s advice and keep them in the loop on a timely basis regarding issues that are popping up. Trying to minimize costs by compressing the time the lawyer has to work out an issue or keeping counsel on the sidelines as to issues that you are facing may be counter-productive. Getting your legal counsel involved early will often lead to better and more cost-efficient advice and results.
How does a legal firm’s size affect its ability to service a business?
Cost structure is a big feature that tends to fluctuate greatly with the size of the firm. This leads to concerns about costs or whether to reach out to outside legal counsel at all.
Midsize firms are a better match for midsize businesses as the cost structure allows for more accommodating rates and fee arrangements, but offers the variety of high-level, experienced legal resources that a midsize business needs in order to quickly address the legal issues it frequently faces in the commercial, corporate, employment, tax and litigation disciplines.
When interviewing firms, what are some key factors businesses should look for in choosing which will represent them?
Look for a connection with your main point of communication with the firm — the legal point person for your business, so to speak.
Engage them on whether they have an appreciation for and experience in the issues involved with your business and market segment, and how they structure their communications, delegation of work and billing. All these items should help you gain a better feel for the firm and whether building a long-term relationship is a real possibility.
Midsize businesses and midsize law firms share a common focus on knowledgeable, experienced and practical advice in order to make decisions. This common connection can result in a valuable partnership and a cost-effective, long-term relationship.
Insights Legal Affairs is brought to you by Sherrard, German & Kelly, P.C.