Crafting an Effective Legal Budget for Your Business
Starting Your Legal Budget: Three Key Suggestions
Creating a legal budget for your business can be a daunting task, especially if you're not sure where to start. Thankfully, a Fractional Chief Legal Officer (CLO) can help.
Unlike outside general counsel attorneys or in-house legal counsel attorneys, Fractional CLOs focus on providing guidance and support to help businesses create and implement effective legal strategies. This includes helping businesses create a legal budget that is tailored to their specific needs and goals.
Here are three powerful suggestions for starting to create a legal budget for your business:
Identify your legal needs. Before you can create a legal budget, you need to know what legal services you need and how much they will cost. This might include things like contracts, trademarks, patents, or litigation. To get a better idea of your legal needs, consider conducting a legal audit or working with a Fractional CLO.
Set specific goals and priorities. Once you know what legal services you need, you can start setting specific goals and priorities for your legal budget. This might include things like reducing legal expenses, improving compliance, or protecting your business's assets. By setting clear goals and priorities, you can ensure that your legal budget is focused and effective.
Create a plan and stick to it. Once you have identified your legal needs and set specific goals and priorities, you can start creating a plan for your legal budget. This might include things like setting aside a certain amount of money each month for legal expenses, negotiating flat fee arrangements with attorneys, or outsourcing certain legal tasks to save money. It's important to stick to your plan and regularly review and adjust it as needed.
The Role of Fractional CLOs in Budgeting
By working with a Fractional CLO, you can get the support and guidance you need to create a legal budget that is tailored to your business's specific needs and goals. This can help you save money, improve compliance, and protect your business's assets, so you can focus on what you do best.
Moreover, Fractional CLOs can be a cost-effective alternative to traditional CLOs. The average total compensation for a Chief Legal Officer in the United States is approximately $342,000 per year. In comparison, the annual cost of Profit from Legal™ is around one-third of the cost of a full-time CLO, saving businesses 66% on the cost of their Chief Legal Officer's total compensation. (Very small businesses may pay even less!) By opting for a Fractional CLO, businesses can access high-quality legal expertise and support while optimizing their legal spend and directing resources to their most efficient use.
It's important to note that the goal of working with a Fractional CLO is not necessarily to reduce overall legal spend but rather to optimize it. By strategically allocating legal resources and leveraging the expertise of a Fractional CLO, businesses can ensure that their legal budget is being used effectively to support their growth and success.
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