How Profitable Is A Legal Services Business? (Updated for 2024)
So you want to start a legal services business?
And the first question that came to your mind was, “well, are legal services businesses actually profitable?”
With a market size of $66B - there’s plenty of business to go around.
Especially considering:
- You could start a legal services business with as low as $200
- Based on our data, legal services businesses generate an average of $2.79M per year
- You could see gross margins as high as 40% with legal services businesses
There’s money to be made. Don’t worry.
But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a legal services business.
Let’s dive in!
Is a legal services business profitable?
Yes, a legal services business is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.
For instance, since average revenue is $2.79M per year with an estimated gross margin of 90%, you could expect to recover your investment within 7 months or even less.
But of course, it all comes down to how much you earn compared to the potential revenues of your legal services business.
To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.
Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your legal services business is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.
Is a legal services business worth it?
If you’re wondering if a legal services business is worth it, the answer is a big YES. With legal services businesses, you have the potential to earn $2.79M per year (this is based on data reported by real founders).
Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.
With a market size of $66B, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.
Of course, you must learn and understand every aspect of running a legal services business to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.
You might want to consider reading more specifics about successful legal services businesses case studies.
Examples Of Profitable Legal Services Businesses
Here are a few examples of profitable legal services businesses, and a few more details about them:
1. Notary Training Network ($54K/year)
recognize the value you bring, but that doesn't define your worth. Surround yourself with like-minded individuals who believe in your vision and continue to push forward.
Is it profitable? Yes
How much money it makes: $54K/year
How much did it cost to start: $0
Notary Training Network, the first state-approved notary education program mandated by law in Maryland, founder Michol Bobb shares her journey of starting the brand and how she achieved full classes of 30-40 students every month through a strong foundation and being hands-on in her business.
2. HMW Law ($3M/year)
Brandon Henderson, the founder of HMW Law, started the business out of his apartment in 2002 with no money. Through a direct mail campaign, sales skills, and a focus on client satisfaction, he built a strong reputation and grew the business into a multi-million dollar-a-year enterprise. Now, he has his sights set on reaching eight figures by 2025 and expanding the firm to other cities in Ohio.
Is it profitable? Yes
How much money it makes: $3M/year
How much did it cost to start: $200
This case study follows the growth from scratch of a Personal Injury and Criminal Defense law firm that started from direct mail campaigns and has now expanded into a multi-million dollar-a-year business with the goal of becoming an 8 figure firm, while maintaining a customer-centric approach and fostering a culture of innovation and excellence.
3. Dabdoub Law Firm ($9M/year)
Edward Dabdoub, leveraging his family's legal background, found his calling in disability insurance law during law school. After winning a life-changing case for a client, he launched Dabdoub Law Firm, now generating $500,000-$700,000 monthly.
Is it profitable? Yes
How much money it makes: $9M/year
How much did it cost to start: $250K
A disability insurance law firm founder saw sustained growth from $100,000 to $500,000-$700,000 fees per month, serving 200+ clients yearly, through a client-focused model emphasizing quality work and nationwide representation with online reviews, tracking of leads, and a dedicated marketing strategy.
Learn more about starting a legal services business:
Where to start?
-> How much does it cost to start a legal services business?
-> Pros and cons of a legal services business
Need inspiration?
-> Other legal services business success stories
-> Legal services business Instagram captions
Other resources
How much can you make with a legal services business?
With a legal services business, you can make an average of $2.79M revenue per year (based on data reported by real businesses).
You can start with an initial investment as low as $200. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 7 months.
How much does a legal services business make a week?
Based on our data, average weekly revenue for a legal services business ranges around $58.2K. As such, you could see monthly revenues of $233K.
To know if your legal services business achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.
Learning your weekly profit can also show whether you're hitting your target goal for your legal services business.
How much do legal services businesses owners make?
The income of a legal services business owner can vary depending on various factors such as location, size, competition, and the owner's business skills.
But to give you some idea, the weekly revenue of an established legal services business is about $58.2K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.
While the potential for earning a good income as a legal services business owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.
Legal Services Business Profit Margins
Generally speaking, a legal services business can expect profit margin of around 90%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of a legal services business, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.
However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, legal services business owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, legal services business owners can ensure long-term sustainability and profitability for their business.
Legal services business owner salary
The salary of a legal services business owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established legal services business, in a prime position, might see an average weekly salary around the ballpark of $52.4K.
But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.
Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.
Conclusion
In a nutshell, based on many of our examples, a legal services business may be a promising business to start - but the success of your legal services business mostly depends on your effort and your approach.
If you focus on these, you'll have a much higher chance of a profitable legal services business.
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Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
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