CategoriesBusiness

The Mother of All Recoveries (The Sequel)

Fasten your seatbelts. Our cryogenically-frozen economy, though in tatters, will recover at a never before seen pace. As an SME-owner here in Yorkshire, let me explain.

Last week brought confirmation – as if it was needed – that the economy took a 20% fall in April. The only surprise was that it was only 20%. Of course, some businesses are booming, but the majority have been hit, just as my law firm has suffered. Large swathes of businesses are in stasis, never to be seen again, when (word of the year) furlough is ushered out.

With our economy heavily dependent on the pursuit of pleasure, our economy ought to be permanently poleaxed. A 1930s-style depression – not just a recession – ought to be a sure thing, right?

The Bank of England defines a recession as 6 months – i.e. two quarters – of concurrent negative economic growth. Q1 – January to March – saw a small Covid-caused contraction, which won’t be a patch on what awaits us in Q2, taking us to the end of June. But will the recession be a continuous feature as many argue?

Brexiteers should be quick to recall “Project Fear’s” warnings, some say led by Bank of England economists, that a guaranteed Brexit-induced recession would commence at 10pm on 23 June 2016 if the people dared to vote against “The Experts”.

Like many Remainer Economics grads, I was convinced that a recession was here to stay. As the economy tanked, “We told you so,” was going to be the refrain to every Brexiteer. Although post-Referendum the Pound took a pummelling, there was no recession.

Which leads me to the failure of economists. On the left, there are Marxist economists, and on the right, we have Thatcher’s and Reagan’s go-to economists at the Chicago School, with every shade in between. Science, medicine and law do not suffer such polars. Economists agree on little. Despite our fetishisation for the opinion of demi-god economists, we must remember that economics simply isn’t a science. And we now know that scientists aren’t always right!

In forecasting what economic fortune awaits, economists frequently miscalculate likely consumer behaviour. People rarely act as anticipated and our economy is powered by this unpredictable force. Economically, Brexit was like the Millennium Bug: we survived it and thrived. Post-Referendum, confidence – the currency of capitalism – was not dented. As the queues I saw outside Sports Direct in Harrogate attest, the confidence gained from the opening of shops will power us out of the carnage.

Whilst my colleagues trickle back to (socially distance) join me at work, Yorkshire’s economy awakens. Listening to my SME clients and witnessing all around my town, I can feel the most powerful economic positive multiplier spinning into action. As a result, Quarter 3 must be better than Quarter 2. If so, recession over, second wave or not.

Though for millions the economic misery will be devastating, unlike when a typical recession hits, such devastation will play out in a rising economy. Capitalism which got us into this mess, through its intrinsic creative and dynamic juices, will get us out of it. The AC – After Corona – economy won’t resemble the BC – Before Corona.

Like pulling back a giant elastic band for three months, either the band will snap, or fly. Fly it should. April’s collapse in GDP wasn’t caused by the economic cycle, which Gordon Brown told us he would conquer, rather it was a choice we had to make. Consumers will ignore the war-era debt mountain and the inevitable tax hikes, and buy that coffee.

Shortly unimpeded by EU State Aid rules, given the need to shorten supply chains, manufacturing will return. With our lower cost base, Northern areas should benefit most. And assuming the Prime Minister survives, we will have a leader oven-ready for the good times. Like him or not, he will be better at getting the country going than in mastering Covid minutiae. My only hope is that in recovery austerity is confined to the ash-heap of history.

From Boris to Karl Marx, accurately bogeyman Marx, in a little-read passage, explained how crime had economic utility, arguing that crime caused better locks, and locksmiths, police, lawyers, judges, law books and law tutors etc. Already, Covid has been the midwife to numerous businesses. More will follow. Excitingly, some of the largest companies were founded in recessions.

In closing, in the US Fed Reserve Chairman Alan Greenspan used to study male underpant sales. Why? The theory was that men – and their partners on their behalf – would only buy new underpants when they were feeling confident about the economy – i.e. the ultimate discretionary spend. I don’t know about you, but I’m off to M&S.

CategoriesBusiness

My business journey

A wonderful lawyer business coach – Ann Page – helped me in my early years of my law firm. Ann interviewed me for her new book Business Skills? Don’t be daft I am a lawyer. Due to illness, I was unable to attend the book launch. What follows is my speech, which was kindly read out by my colleague.

Since Ann conducted her interviews, I have tried some psychotherapy. Everyone should. Trawling through my past, it’s easy to see where TL came from.

My parents ran businesses, in fact, my dad at 77 still runs a business. They discussed business at the table. These things just soak in. I guess what soaked in most of all was that it was “normal” to work for yourself.

My first business was aged 9, selling coke cans at school. I would go to the wholesalers with my folks. Borrow the money for a crate of cans, then sell the cans at school during the summer.

The second business was washing cars, which was much harder work.

I didn’t much enjoy school, and despised law school so much so that I asked for my money back. I don’t go out of the way to break the rules, but I really didn’t like following others’ rules.

My interest in politics, particularly left-wing politics, developed on my degree, killed my business instinct. Left-wingers simply didn’t discuss business, even ethical business.

Fast forward to 2007, I qualified and took a job at Ford and Warren, now Weightmans. I hated it. Before I was 1 year PQE, I got my dream job at Thompsons – which was very left-wing trade union law firm. So left-wing was I that I was the elected as the trade union rep for the lawyers – and I organised a strike!

After a few years, I became incredibly disillusioned, because the firm which was meant to look after the working person became hypocritical. The nail in the coffin was when my second child was born, my firm wouldn’t let me take the two weeks of paternity leave over two periods! I’m still narked about that.

So with two kids under two, my wife on mat leave, I resigned. It was a toss-up between being a stay-at-home dad, or setting up my firm. I’m glad I set-up, as my children wouldn’t have made it their second birthdays!

My business plan was on one page, and like any business plans, they don’t survive their first meeting with a customer. I costed that the firm would cost 30k in year. Doing predominantly No Win, No Fee personal injury work, I knew that cashflow was going to be my biggest headache.

A funny story is that, when costing our family’s outgoings for year one, I came to the conclusion that if we made some savings, that we could get by. I genuinely broke down in tears – and I’m not a crier – when I realised that I forgot to take the mortgage payments into account.

I borrowed 30k from my folks. I still owe 10k!

In terms of bringing work in, although I am not “techy” I realised that there was very little content online about “assaults at work” – an area of personal injury law that I had specialised in.

My first day at work was 30 April 2012, but I wasn’t allowed by the SRA to practice until 15 August 2012. It’s weird starting a firm, because you start with no legal work! But I was busy – very busy – writing content, policies, etc. During this time, I went on Ann’s management course.

Work came from all sorts of areas. Other lawyers. People in the virtual office. A friend of a friend. The very odd thing about running a law firm is that, before you went solo, friends and family wouldn’t ask you a question or send you a case. When I was alone – without any structure or supervision – then people send you all sorts.

A wonderful lawyer and person, Angela Davies, invited me a BNI networking event. I remember that 6am start more than any other event over the years. The penny dropped for me. I felt like Neo in the Matrix. Harrogate is full of networks – and that’s how most of the work is won.

Networking taught me business: learning and listening to others. Watching businesses succeed and fail. Teaching you how to spot a charlatan. Teaching you how to give an elevator pitch.

Year one I made a loss, and of course was down the 40k salary I was on in Leeds. Year two, Georgina Parkin came along as our first trainee solicitor, because I was rammed with work and she had had the good sense to send lots of letters demanding a training contract. Georgina earned more than I did for the first few years. That’s something they don’t tell you. You borrow money to put in, then make a loss, but pay your staff AND lose the salary that you would have had in your old job.

My ingrained, innate plan was always to hire staff and to hire brilliant staff. I was always worried about going under a bus and leaving my clients high and dry. As I had rough health as a kid, I also knew that I needed a decent-sized team because I was going to be ill at some point – and sure enough that has happened.

Podcasts have honed by business acumen, particularly podcasts emanating from the US. I now run three podcasts. Our brand and website was inspired by a US marketing legend called Seth Godin. He came up with the Purple Cow theory of marketing. Truth Legal was a purple cow. It had to stand out online, particularly in a world of some dodgy “have you had a claim in the last three years” cowboys.

As a Quaker, I was inspired by some of the Quaker business legends of the past: Rowntrees, Cadburys, Lloyds, Barclays, Waterhouse, Clarks etc etc. Studying what they did, they treated their people well, their customers trusted them, and as a result their businesses flourished. Those Quakers were, I would argue, some of the first ethical business leaders. I’ve tried to follow their principles.

I would finish with a few points I’d like to make:

  1. Luck is a massive factor in any success. For me, the largest PI firm in the area was shut down by the SRA into our second year..
  2. As you grow, give people the work that they thrive at. We now have people who are far superior at their jobs than I now am at those jobs. I think a business owner should do themselves out of a job.
  3. Law firms have historically had massive profit margins and law firm owners have been historically super greedy. It doesn’t need to be that way. Businesses like Aldi survive on a 1% profit margin.
  4. Do we need business skills? Yes, as most of us don’t have any, but the good news is that we lawyers are good at learning and so we can learn new skills. The challenge is to de-programme ourselves from our business ignorance that our educational establishments, particularly law school, have bequeathed us with.
  5. A hard part for a lawyer business person is having to make decisions with imperfect information, quite the opposite as to how we advise our clients.
  6. Finally, lawyers have been under attack for a decade now. Legal Aid has been all but killed. Advice centres have been hammered. Miscarriages of justice are rife. Employment Tribunal fees were adjudged to be unlawful, just like the prorogation. The changes to the personal injury world, coming soon, are an affront to the rule of law, and just wait for the politicisation of the judiciary. Us lawyers need to stick together. We have huge constitutional importance and we should never forget that.
CategoriesBusiness

My personal statement

I want to be the best person that I can be, using all my God-given and nurture-generated, attributes, whether I am at home or at work. At home, I want to be a dad who is around as much as possible (and available should an emergency present itself) as well as being able to financially provide in both the short and longterm.

I want justice. I want to give birth to a company. I want to control my destiny. To make a journey. To maintain the highest standard of integrity with all my inter-personal dealings. To stop manager-caused anxiety. I want to provide an outstanding, cheap and fast legal service to those who have been wronged.

I want to work smarter: to work close to home, in an area I adore, at a pace that I choose, when I want. I don’t crave vast riches; I just want to be rewarded fairly.

I want to work in relative quiet. I want to properly research legal issues. I want to write a book. I want to be able to mould future lawyers. I want to be part of a team in which all staff don’t mind coming to work; where the staff share in the success of the enterprise – be that with financial rewards or with other dividends such as good career development.

I want to be dynamic. To be creative. To improve my presentation and advocacy skills. To develop other skills. To grow as a human. To become more rounded.

I want to use the law firm for political ends, in terms of helping the needy or by raising my own standing so that I can help the needy from my privileged position.

Too often the little guy, who finds himself embroiled in a dispute, is either priced out of obtaining legal advice, pays for lawyers he can barely afford or has appointed lawyers, whom he didn’t properly choose.