A legal document preparation business is a type of business that provides assistance to individuals who need help preparing legal documents. These businesses offer services such as drafting and formatting legal documents, preparing legal forms, and reviewing and editing legal documents.
Typically, legal document preparation businesses are not law firms and do not provide legal advice. Instead, they assist clients in filling out forms and other legal documents correctly and in compliance with applicable laws and regulations. They can help with a variety of legal documents such as wills, contracts, deeds, and divorce papers, among others.
Legal document preparation businesses belong to the legal services industry and available data shows that the global legal services market grew from $787.28 billion in 2022 to $838.92 billion in 2023 at a compound annual growth rate (CAGR) of 6.6 percent.
Steps on How to Start a Legal Document Preparation Business
Table of Content
Conduct Market Research
To conduct market research for a legal document preparation business, it is important to identify the target market and understand its needs and preferences. This can be done through surveys, focus groups, and analyzing industry trends. It is also important to research competitors and their offerings, as well as pricing strategies.
Social media can be a valuable tool for gathering insights on consumer behavior and preferences. Once the research is conducted and concluded, it can be used to develop marketing strategies and tailor services to the target market.
a. Who is the Target Market for Legal Document Preparation Business?
- Individuals going through a divorce or separation who need help preparing legal documents related to property division, child custody, and spousal support.
- Small business owners who need help preparing legal documents related to contracts, agreements, and business formation.
- Landlords and property owners who need help preparing legal documents related to leases, rental agreements, and eviction notices.
- Individuals who need help preparing estate planning documents such as wills, trusts, and power of attorney documents.
- Immigrants who need help preparing legal documents related to visas, green cards, and citizenship.
- Non-profit organizations who need help preparing legal documents related to formation and compliance with state and federal regulations.
b. Is a Legal Document Preparation Business a Profitable Business?
Yes, the legal document preparation business is a profitable business. Available data shows that the global legal services market grew from $787.28 billion in 2022 to $838.92 billion in 2023 at a compound annual growth rate (CAGR) of 6.6 percent.
c. Are There Existing Niches in the Industry?
No, there are no clear-cut niche ideas when it comes to legal document preparation business simply because legal document preparation business is a niche idea in the legal services industry.
d. Who are the Major Competitors?
- Nuance Communications, Inc.
- Anacomp Inc.
- Planet Depos, LLC
- American Shredding Inc
- DRS Imaging Services LLC.
- We The People
- Phoenix Legal Document Preparer
- The Law Offices of Michael Burgis & Associates
- Grant Shenon Law Firm
- Guzman Paralegal Services
- Rocket Lawyer
- Reliable Document Services
- Easy Solutions Paralegal Services
- Razavi Law Group
- Affordable Legal Document Service
- One Stop Legal Shop
- All About Legal Forms.
e. Are There County or State Regulations or Zoning Laws for Legal Document Preparation Business?
In the United States, regulations and zoning laws for a legal document preparation business can vary depending on the state, county, and city where the business is located. In general, legal document preparation businesses are considered professional services and can typically be located in commercial areas or office buildings.
It is important to check with local authorities to ensure compliance with zoning regulations and any necessary business licenses or permits. Additionally, legal document preparation businesses must comply with federal, state, and local laws related to employment and hiring practices, such as anti-discrimination laws and regulations related to background checks.
f. Is There a Franchise for Legal Document Preparation Business?
No, there are no franchise opportunities for legal document preparation businesses.
g. What Do You Need to Start a Legal Document Preparation Business?
- Business plan
- Legal structure
- Licenses and permits
- Standard office facility in a suitable location
- Marketing and advertising plans
Choose a Memorable Business Name
When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.
Some of the catchy business name ideas suitable for a legal document preparation business are;
Creative Legal Document Preparation Business Name ideas
- Jeff Johnsons and Partners® Legal Document Preparation Firm, Inc.
- Gerrard Allen® Legal Document Preparation Firm, LLC
- Corinne Casper™ Legal Document Preparation Firm, Inc.
- Moses Godsent® Legal Document Preparation Firm, LLC
- Andrew Anderson and Partners® Legal Document Preparation Firm, Inc
- John McLee® Legal Document Preparation Firm, Inc.
- Lawrence Lugard® Legal Document Preparation Firm, Inc.
- Laura Bannock™ Legal Document Preparation Firm, LLC
- Freda Williams© Legal Document Preparation Firm, LLC
- Nancy Jones® Legal Document Preparation Firm, Inc.
- Jon Errickson™ Legal Document Preparation Firm, Inc.
- Anne Pelzer® Legal Document Preparation Firm, Inc.
- James Kingsley® Legal Document Preparation Firm, LLC
- Fiona Anthony® Legal Document Preparation Firm, LLC
- Ian Wenger® Legal Document Preparation Firm, Inc.
- Shannon Ferguson® Legal Document Preparation Firm, Inc.
- Ben Markson© Legal Document Preparation Firm, LLC
- Linda Humphrey® Legal Document Preparation Firm, Inc.
- Kings Court® Legal Document Preparation Firm, Inc.
- Westminster Abbey© Legal Document Preparation Firm, Inc.
Register Your Business
a. What Type of Business Structure is Best for a Legal Document Preparation Business?
The best business structure for a legal document preparation business depends on several factors, including the size of the business, the number of owners, and the level of personal liability exposure the owners are willing to accept.
However, we usually recommend a limited liability company (LLC). An LLC is a popular choice for startup businesses because it offers personal liability protection for the owners while allowing them to be taxed as a pass-through entity. This means that the profits and losses of the business are passed through to the owners’ personal tax returns, avoiding double taxation.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Legal Document Preparation Business?
- Business License
- Building permit
- Fire safety license and permit
- Fictitious name registration
- Professional license (if you offer legal advice or services that require a law license)
- Zonal permit.
d. What Type of Certification is Needed to Open a Legal Document Preparation Business?
- Certified Legal Document Preparer (CLDP)
- Certified Paralegal (CP)
- Certified Legal Assistant (CLA)
- Accredited Legal Professional (ALP)
- Certified Legal Secretary Specialist (CLSS).
e. What Documents are Needed to Open a Legal Document Preparation Business?
- Business plan
- Business License
- Fictitious name registration
- Employer Identification Number (EIN)
- State-specific licenses and permits
- Building permit
- Fire safety license and permit
- Professional licenses and certification
- Zonal permit
- Insurance policies
f. Do You Need a Trademark, Copyright, or Patent?
Whether you need a trademark, copyright, or patent for your legal document preparation business will depend on the specific intellectual property you want to protect. If you want to protect your business name, logo, or other branding materials, you may want to consider registering a trademark with the US Patent and Trademark Office (USPTO).
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Legal Document Preparation Business?
When it comes to starting a legal document preparation business, the startup costs can range from as low as $5,000 to over $80,00. Please note that the cost of securing an office facility, equipment, furnishing, and the salary of your employees are part of this cost.
b. What are the Costs Involved in Starting a Legal Document Preparation Business
- Business Registration Fees – $750.
- Legal expenses for obtaining licenses and permits – $1,800.
- Marketing, Branding, and Promotions – $2,000.
- Business Consultant Fee – $2,500.
- Insurance – $2,800.
- Rent/Lease – $30,000
- Other start-up expenses include commercial satellite TV subscriptions, stationery ($500), and phone and utility deposits ($1,800).
- Operational Cost (salaries of employees, payments of bills et al) – $45,000
- Store Equipment (cash register, security, ventilation, signage) – $2,350
- Equipment, Furniture, and Software – $10,000
- Website: $1,200
- Opening party: $5,000
- Miscellaneous: $5,000
c. What Factors Determine the Cost of Opening a Legal Document Preparation Business?
- The size of the legal document preparation business
- The choice of location
- The required licenses and permits
- The cost of hiring and paying a business consultant and attorney
- The cost of branding, promotion, and marketing of the legal document preparation business
- The cost of furnishing and equipping the legal document preparation office facility
- The cost of the insurance policy covers
- The cost of registering the business
- Cost of recruiting and training your staff
- The cost for the grand opening of the legal document preparation business.
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
No, you don’t need to build a new facility for your legal document preparation business. This is because the business can operate from a rented or leased office facility.
e. What are the Ongoing Expenses of a Legal Document Preparation Business?
- Employee Salaries and Benefits
- Office Rent and Utilities
- Technology and Software such as computer hardware, software subscriptions, and cloud storage.
- Marketing and Advertising
- Office supplies and equipment such as printers, copiers, and office furniture.
- Professional Memberships and Certifications
- Legal and Accounting Fees.
f. What is the Average Salary of your Staff?
- Chief Executive Officer (Owner) – $58,000 per year
- HR Manager- $45,000 per year
- Account Manager – $42,000 per year
- Marketing Officers – $42,000 per year
- Legal Document Preparers – $40,000 per year
- Administrative Assistant – $35,000 per year
- Customer Services Executive – $32,000 per year
g. How Do You Get Funding to Start a Legal Document Preparation Business?
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Pitching your business idea and applying for business grants and seed funding from the government, donor organizations, and angel investors
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Jeff Johnsons and Partners® Legal Document Preparation Firm, Inc. is a legal document preparation business located in New York City, New York. Our company provides affordable and reliable legal document preparation services to individuals, families, and small businesses.
Our company is committed to providing our clients with a seamless and hassle-free experience. Our team of experienced and knowledgeable professionals is dedicated to providing our clients with personalized attention and exceptional customer service.
With over 10 years of experience in the legal document preparation industry, our company has built a strong reputation for quality and reliability. Our competitive pricing and convenient location make us an ideal choice for clients seeking affordable and convenient legal document preparation services.
We believe that our company is well-positioned for growth and success in the legal document preparation industry. With a focus on customer satisfaction and quality service, we are confident that we can continue to expand our client base and increase our revenue.
b. Products and Service
We offer a wide range of services, including document preparation for family law, immigration, real estate, and business law matters. In addition to our core services, we offer a variety of value-added services such as notary public services, document translation services, and virtual document preparation.
c. Mission Statement
At Jeff Johnsons and Partners® Legal Document Preparation Firm, Inc., our mission is to provide affordable and reliable legal document preparation services to individuals, families, and small businesses. We are committed to delivering exceptional customer service and personalized attention to each of our clients.
Our vision is to become the leading provider of legal document preparation services in the United States. We aim to achieve this by continuously improving the quality of our services and expanding our offerings to meet the changing needs of our clients.
d. Goals and Objectives
The goals and objectives of a legal document preparation business are to offer services such as drafting and formatting legal documents, preparing legal forms, and reviewing and editing legal documents.
e. Organizational Structure
- Chief Executive Officer (Owner)
- HR Manager
- Account Manager
- Business Development Manager
- Legal Document Preparers
- Administrative Assistant
- Customer Services Executive.
a. SWOT Analysis
- Experienced team with knowledge of legal document preparation and related laws and regulations
- Affordable and competitive pricing compared to law firms
- Convenient location for clients to access services
- Value-added services such as notary public and document translation services
- Strong reputation for quality and reliability.
- Limited range of services compared to full-service law firms
- Limited marketing and advertising budget
- Dependence on the local market.
- Expanding services to other regions or states
- Developing online services and virtual document preparation
- Partnering with other businesses or organizations to offer bundled services
- Developing a referral program to increase word-of-mouth marketing.
- Competition from other legal document preparation businesses
- Changes in laws and regulations that may affect the industry
- Economic downturns that may reduce demand for legal services
- Lack of consumer trust or negative perceptions of legal document preparation businesses.
b. How Do Legal Document Preparation Businesses Make Money?
Legal document preparation businesses typically make money by charging clients fees for their services. These fees may be structured in a variety of ways, including hourly rates, flat fees per document, or a combination of the two.
c. Payment Options
- Credit or Debit Card
- Electronic Payment Systems such as PayPal or Venmo
- Bank Transfers.
d. Sales & Advertising Strategies
- Create a website and social media profiles to showcase your services, pricing, and other relevant information.
- Use search engine optimization (SEO) techniques to make your website more visible in search engine results.
- Use targeted online advertising to reach potential clients. This can include pay-per-click (PPC) advertising on search engines or social media platforms, as well as display advertising on relevant websites.
- Attend local events such as business conferences and networking events to promote your services and connect with potential clients.
- Encourage satisfied clients to refer (word-of-mouth referrals) new business to you by offering discounts or other incentives for referrals.
- Create valuable content such as blog posts, infographics, and videos that provide valuable information for your target audience.
- Offer package deals for clients who need multiple documents prepared.
- Participate in relevant online forums and communities to share your expertise and connect with potential clients.
a. How Much Should You Charge for Your Product/Service?
Generally, legal document preparation firms charge either a flat fee or an hourly rate for their services. Flat fees may range from $50 to $500 or more depending on the type of document being prepared. Hourly rates can range from $50 to $200 or more depending on the experience and expertise of the firm’s staff.
b. How Much Profit Do Legal Document Preparation Business Owners Make a Year?
The earning potential of legal document preparation businesses can vary based on their level of experience, the size of their client base, and their ability to market and promote their services effectively.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the legal document preparation business
- The service offerings of the legal document preparation business
- The location of the legal document preparation business is covering
- The management style of the legal document preparation business
- The business approach of the legal document preparation business
- The advertising and marketing strategies adopted by the legal document preparation business.
- The number of years the legal document preparation business has been in business
d. What is the Profit Margin of a Legal Document Preparation Business?
On average, the profit margin of legal document preparation businesses range from 25 percent to 35 percent, depending on the location, and service offerings.
e. What is the Sales Forecast?
Below is the sales forecast for a legal document preparation business. It is based on the location of the business and other factors as it relates to such startups in the United States.
- First Fiscal Year (FY1): $240,000
- Second Fiscal Year (FY2): $350,000
- Third Fiscal Year (FY3): $480,000
Set Up your Shop/Office
a. How Do You Choose a Perfect Location for a Legal Document Preparation Business?
- The demography of the location
- The demand for legal document preparation services in the location
- Accessibility of the location
- The number of legal document preparation firms in and around the location
- The local laws and regulations in the community/state
- Traffic, parking, and security et al
b. What State and City is Best to Open a Legal Document Preparation Business?
- New York City, New York
- Los Angeles, California
- San Francisco, California
- Washington, DC
- Seattle, Washington
- Miami, Florida
- Chicago, Illinois
- Atlanta, Georgia
- Boston, Massachusetts
- Dallas, Texas.
c. What Equipment is Needed to Operate a Legal Document Preparation Business?
- Computer and software
- Phone and Internet service
- Accounting software
- Office equipment such as computers, printers, scanners, and office supplies to manage bookings and finances.
When it comes to a legal document preparation business, it is safe to say that the business can be operated by an individual. But the idea behind the business is perhaps to start small and grow big. In essence, if you are looking to start a document preparation business, then you should make plans to hire some key employees that will help you build the business.
Launch the Business Proper
Organizing an opening party for a new legal document preparation business is a fantastic idea as it that will help you introduce the business to the community and create awareness about your services. But, it is important to note that for this type of business, you may decide not to organize a launch party especially if you are operating on a shoestring budget.
a. What Makes a Legal Document Preparation Business Successful?
- Being consistently reliable
- Excellent customer service
- Efficient operations
- Compliance with regulations
- Hiring skilled and knowledgeable employees and providing ongoing training that will ensure you deliver high-quality services.
b. What Happens During a Typical Day at a Legal Document Preparation Business?
- The office is open for the day’s work
- Routine staff meetings, briefing, and de-briefing
- The core duties are carried out which may include sourcing for clients, drafting and formatting legal documents, preparing legal forms, and reviewing and editing legal documents.
- Administrative tasks such as scheduling appointments, billing, invoicing, and managing supplies and equipment are carried out.
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Legal Document Preparation Business?
- Legal knowledge
- Attention to details
- Excellent customer service skills
- Human resources skills
- Time Management skills
- Organizational skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Organizational skills
- Work experience in the legal services industry
- Experience in managing people
- Experience in business administration.