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If something unexpected happened to you this week, what would your clients experience? Do you have a law firm contingency plan or succession plan in place that could be seamlessly implemented? Or would chaos reign, causing your clients (rightfully) to panic about their legal matters?

A small firm owner in a mid-sized city spent months secretly exploring the sale of his practice. He had a strong client base, a stable referral network, and an intimate team that he had built over three decades. When a potential buyer expressed serious interest, he agreed to meet.

Rule 1.17 of the Model Rules of Professional Conduct states that after a sale, sellers must “cease to engage in the private practice of law.” Does that mean you must hand over the keys, walk out the door, and immediately ride off into retirement sunset? And if the answer is yes, how is that realistically possible?

Personal injury law firms are different from other types of firms in terms of practical economics. Here are three reasons why. Part of the firm’s value is relatively easy to determine and find buyers for; Insider deals for these firms can be problematic; and Outside investors are a new pool of potential buyers. Let’s take a closer look at these factors.

One retirement exit strategy often considered by solo practitioners and small law firm owners is the "recruit your successor" one. The idea behind this strategy is to find a young, inexperienced lawyer who is then groomed to take over the practice.

Last month, I went out to dinner with some friends. One friend announced to the group that, after working for a large telecommunications company for more than 25 years, he was being offered an opportunity to retire early with some very nice incentives. He further informed us that he had intended to retire within the next year. So, the offer was not going to change his planned retirement date in any significant manner.

If you’re like most lawyers, you didn’t go to law school because you loved spreadsheets and financial reports. For most small firm owners, financial reporting receives only the level of attention needed to keep the firm operating. But when the time comes to sell the practice, clear financial records suddenly become very important. Financial clarity can be the difference between a smooth, professional transaction and a serious buyer losing interest. If your books are clean, consistent, and understandable, you strengthen your negotiating position. If they are messy or unclear, the purchase of even a strong practice can appear risky for a potential buyer to undertake.

I recently wrote about how private equity is in the very early stages of exploring the law firm marketplace to disrupt it and, of course, make money. Here’s what these investors will find when they begin their journey to acquire law firms. Simply put, they have their work cut out for them. The law firm marketplace is immature, underdeveloped, and difficult to navigate.