Author: Richard Farrell, is the driving force behind our mission to help process servers achieve consistent quality in service of process. His extensive experience in training and education development brings a modern approach to finding practical solutions to the process service industry.
There are a lot of factors that can contribute to your process service business’ chances of success, but none are as important as financial management. You may have decided to open a process service business because you have military or law enforcement background, or because you’re great investigating and locating people. Regardless of the reasons you started a process service business, it won’t automatically turn you into an accountant or make you financially savvy. Here are five ways that can help you manage your finances when it comes to starting and running a process service business:
1. Budgeting is Your Best Friend
The most important part of any financial plan is a budget. But how do you budget when you have no clue what’s going to come in? One of the easiest places to start is to minimize your expenses as much as you can while building and growing your process service business. A budget shouldn’t be considered a plan for where to spend every dollar, but rather the framework to help you make rational decisions about how your money is going to be spent.
Create categories that include office rent (if renting an office), transportation, office supplies, memberships in process server organizations, like PROServer Center, process service management software and marketing, and then come up with ways to reduce costs in each category as much as possible. Once you’ve done that, figure out how much you’ll need to make to cover those costs and still have money left over to save or invest back into your process serving business. This should be your goal for profitability.
Holly Black, a process server in Minnesota, has spent her time as an entrepreneur learning how to manage her finances after deciding to pursue a career in process service. She has found that a budget should be used as a guide, allowing yourself the flexibility to make adjustments when and where necessary as you go along. “But,” she says, “never abandon the budget. Always know what’s coming in versus what’s going out. Make sure your essential overheads are covered, or that they can be covered by an emergency fund if there’s a revenue dip.” That bring us to our next tip:
2. Maintain an Emergency Fund
What do you do if (or more likely, when) your process service business goes through a slow period and you can’t turn a profit? Or, if your worst nightmare comes true and your business isn’t successful and you can't attract enough legal professional clients? These are scary thoughts, but the reality is they’re very common scenarios for a lot of small business owners who can’t ensure a steady or consistent income. This is perhaps one of the most common concerns process servers share.
An emergency fund can help you get yourself out of a tough situation. Once you’ve figured out how much money you’ll need to cover your process service business and personal expenses for one month, multiply that by six, and make sure you always have that much in your emergency fund. During slower months, or when you come across unplanned expenses, you may need to draw upon your emergency fund. That’s fine, (that’s what it’s there for!) but make sure you’re always replenishing those funds to protect yourself against future unforeseen costs or circumstances.
Izabela Szydlo, a process server in Florida, has been running her process serving and courier business for over five years, and has maintained an emergency fund regardless of how the business was doing financially. “I always ensure that I have a certain amount [of money] in the bank that makes me feel safe should things slow down. When I was still in school, a professor told me that if I wanted to freelance, I should get myself a good line of credit as a safety net. I have one of those too, just in case. Obviously, the goal is to never have to use it.”
3. Hire Professionals When You Need Them
Chances are, if you’re reading this list you’re probably not an accountant. While it’s common for process servers to try and handle everything on their own (especially when trying to minimize costs), attempting to manage your own books or file your own taxes could actually end up costing you far more in the end. Spending money on a professional will often help you save money (and will always help you save the headache). Accountants will not only find you more deductions and tax savings, but will also ensure you remain penalty-free and don’t get yourself into trouble inadvertently.
Tara Gosling opened her process serving business over five years ago. Although she is confident in her skills as a process server and investigator, she has never been confident with her bookkeeping. “The hardest part for me has always been staying organized with my bookkeeping, and it’s something I still struggle with now. It makes a huge difference and relieves a lot of stress, especially come tax time, to have everything written down clearly. If taxes, bookkeeping, or numbers are not your strong points, pay a professional to help you! I wish I had done that my first year.”
4. Set Money Aside for Taxes
Getting your ducks in a row for tax season can be challenging, frustrating, and a few other adjectives we’d rather not spell out. Something as minor as a lost bill or receipt can have a damaging effect on your tax filing process and may even get you into big trouble.
Nobody likes paying taxes but the reality is, none of us can avoid it. The government isn’t forgiving; when you owe, you owe, and you don’t want to be blindsided by an expense you didn’t expect or see coming. Your rates will be different depending on your location, but the general rule of thumb is to set aside at least thirty-five percent of your income for taxes.
“Don’t neglect your taxes. I can’t stress that enough. It’s tempting to think, ‘I’ll just write off a bunch of expenses and that will cover it.’ Sometimes it won’t, and you should definitely be putting money aside for [your taxes],” says Izabela. Holly agrees. “Do your taxes as early as possible, that way there will be no nasty surprises and you can forecast how much extra income you may need to cover when the payment is due.”
5. Make Sure You’re Getting Paid
There’s nothing that feels as good as knowing you’ve made a client happy with your services. Except of course, knowing that they paid their invoice for said services on time.
When you’re running your own process service business, client payments are your lifeline. If your invoices don’t get paid, your bills don’t get paid, and if your bills don’t get paid, your business can’t run. One of the most important things you can do as a process server is to have a clear and defined payment policy in place. Your clients should know what payments are due, when they’re due, how they can be paid, and what happens if payments are late or missed. You can’t force anyone to make a payment, but what you can do is:
Ancil Payne, who runs a process service business in Texas, helps us understand why getting your clients to pay on time is so important. “The hardest part financially of running your own process serving business is the unpredictability of client payments. In the beginning, when clients aren’t paying on time, you find yourself paying out everyone else, leaving you with just enough to keep your doors open. [When clients pay you late] you may find yourself incurring debts because you’re paying your own loans or bills late.”
Running a process service business isn’t easy; that’s why not everyone can do it. Successful entrepreneurship requires focus, dedication, and passion, and of course, a few ways to deal with the ups and downs of your cash flow. We’ve tried to help with the latter so you can spend more time focusing on the former.
Author: The Process Server Center | PROServerCENTER is a legal professional organization whose mission is to set a national standard for the process service industry in the United States.
Have you tried to find a process server who can serve your legal documents promptly and correctly? If you have ever needed one, most likely you know that it is not so easy to find a good and reliable process server. It becomes even more complicated if you are looking for a process server who can handle a larger volume of services on a regular basis. How about when you need a process server in another county or state? Finding a good and reliable process server can quickly become difficult and time consuming. All you need, after all, is to quickly reach out to a process server who is ready, available and willing to work with your legal team and efficiently deliver your legal documents.
When you are trying to find a process server, most likely you are doing one of the following:
What these methods have in common is that you may or may not find a process server who covers the specific area you are looking for or you end up with a list of process servers, sometimes even several pages of names, without a reliable way to sift through the names and select the best and most reliable one. You have to spend valuable time to call or email each process server and using very little information, you must decide who to hire to serve your legal documents. Yet other times you end up finding someone who seems reliable only to discover that they are miles away from the zip code of the service address and later on they have a hard time providing status on your service. If you are lucky, another legal professional may refer you to a good process server whom they have successfully used before. That's where reviews and referrals could be extremely helpful in saving you time and valuable resources when looking for a process server.
When it comes to reviews, there are a couple of ways they can help your legal team when looking for a process server:
If a process server or a process service business have a website and a Google listing, then most likely they have or are trying to build their reviews online. Of course, there are many other search engines, general business and legal services directories where process servers may have a profile and accept reviews. Are you wondering why reviews are important? Are they trustworthy? Do you need them whether or not they are completely real? Online reviews have created a new field in marketing and communication that bridges the gap between traditional word-of-mouth and a viral form of feedback that can influence your clients’ opinion. Maybe you are already on board, collecting reviews about the level of the service you provide and responding to the valuable feedback of your clients but let’s take a step back to enumerate some reasons that make client reviews so important.
Reviews are an important indicator to consumers as to whether or not to purchase a service. Here’s why:
Some of the reasons reviews are important for your process service businesses:
Almost every paralegal you talk to has a story about their unpleasant experience of dealing with a process server. It is common to hear that it took them hours to just find one single process server. Or they sent their legal documents to a process server who seemed reliable, only to never hear back from him again. Or the story of another paralegal whose documents were served fast, but had the hardest time trying to get an affidavit from the process server. Behind many of these stories, frustration is a common thread.
Fortunately nowadays, there are better ways to find a process server for any type of legal documents, anywhere in the United States. While some legal professionals still prefer to take a risk with search engines, Craig’s List, online forums, or the increasingly insignificant yellow pages, a much better avenue for finding the process server you need is PROServer List.
In fact, when a paralegal needs a process server in Orange county, California, he or she may quickly find the top 3 process servers using PROServer List. How about a process server in the Atlanta, Georgia area? If you have ever tried to find a process server in some of the large metropolitan areas, you are familiar with the long lists of names of process servers some of the nationwide directories throw at you. As a busy paralegal, you certainly do not have time to call each and every process server from three or four pages showing 25 or more servers per page. And how do you even begin to find out whom you can trust to get the service done on time and correctly?
Equipped with PROServer List, legal professionals may now skip the long line and instead focus only on the top 3 process servers included in each county in every state. Built on the foundation of more than 100,000 successfully completed service of process, PROServerLIST connects government agencies and legal professionals directly to its online directory of Pre-Screened and Certified Process Servers in order to improve the legal support services experience for both legal clients and process servers.
PROServerLIST is an exclusive Directory designed to provide client rankings of process servers in order to:
The Process Server Center holds its process servers to the very highest standards of consistent quality of their services, sustainable record of services completed correctly, and continuous training and improvement. PROServerLIST is the only Directory in the United States where government agencies and legal professionals hire Certified and Pre-screened process servers.
Think of PROServer List as the Client Reports for process servers.
You can log-on to the site any time of the day to do some searches for highly recommended process servers as well as read all the unbiased and verified reviews on them provided by legal professionals who have recently used their services. In fact, PROServer List is the only place of its kind that provides unbiased reviews and other-related information that are focused on process servers in the United States. Think of PROServer List as the Consumer Reports for process servers nationwide, represented by the top three process servers in any given county.
Process Servers are rated on the site based on various criteria that includes professionalism, quality, responsiveness, punctuality, and of course, price. Each process server who takes one of the 3 tops spots has successfully completed the Certification Exam and/or Training program for process servers. Paralegals find this rating system and client reviews very helpful. They definitely save time, valuable resources, eliminate delays in legal case proceedings and of course, they eliminate frustrations from improperly served legal documents. With PROServer List, legal professionals have a much better chance of weeding out unprofessional and low quality process servers as client members provide their feedback on their actual experiences with these process servers. Furthermore, in order to guard against unscrupulous legal professionals from reporting positively on themselves or negatively on others, reviews are only accepted by current client members, then verified and checked prior to being included as part of a process servers' online resume.