Hidden Costs of Keeping Paper Files
by Paul Ruby
In recent months, we've discussed how converting your paper files into digital ones by scanning can streamline your practice and save you money. Here are two ways that your paper files are stealing from you every month.
1. Real Estate
With today's technology, it is no longer necessary to keep paper files. Those files take up valuable real estate. Think of the square footage of your office. How much of it is taken up by banker's boxes full of your old client files? How many file cabinets are full of concluded client files? Now estimate how much of your total floor space those papers takes up or make otherwise useless. 5%? 10%? 15%? 20%? 25%? More?!?!?
I'd guess it's not an insignificant amount. So, let's do some math. We'll use very modest, conservative dollar amounts to show you how much money our service can save you.
Let's say you're a small firm and your rent is two thousand dollars a month. One small office, occupying 20% of your usable floor space serves as a file room. As a fraction of the whole, that office costs you four hundred dollars a month. You're wasting almost five thousand dollars a year - year after year - on that office!
Let's now pretend all your files have been scanned and digitally archived. You can rent that office out to a solo practitioner or an accountant. Because your office infrastructure is already in place, you can easily add a phone line and give that person access to other office amenities for a very modest incremental price increase; it wouldn't be difficult to create an office you could sublease. That office could easily bring in much more than four hundred dollars a month in rent. Conservatively, let's say you can sublease it out for seven hundred dollars while the additional costs you incur come to one hundred dollars, for a net of six hundred dollars a month. This is a big financial swing. You were wasting four hundred dollars, but now you're netting six hundred on that office. In this scenario, scanning your documents would put a thousand dollars a month in your pocket! Another way to picture it is that you're out-of-pocket rent has become one thousand four hundred - scanning your documents can cut the rent you pay by 30%!
Even if your current filing system is fairly organized, human error is inevitable. How much time does your staff waste looking for lost files, for misplaced files, and just digging around for properly-placed files on a weekly, monthly, or yearly basis? If you think carefully, it's probably not an insignificant amount of time. If four people in your office spend a half hour looking for files twice per month, you've wasted almost fifty hours of time per year. To put it a different way, you've wasted more than one entire week's worth of output from one of your staff members. That's a lot of time (and a lot of money)! Wouldn't it be easier to just go into your server, search for or find a name that's been alphabetically indexed, and have immediate access to those documents? Of course it would! And, as you can see, it would be much cheaper too. That's yet another way scanning can add value to your practice.
Paul Ruby is General Counsel at ILW.COM. Mr. Ruby is based out of ILW.COM's New York headquarters after several years in private practice in Milwaukee, Wisconsin. Mr. Ruby is a graduate of Brown University and Marquette Law School. He is a member of the State Bar of Wisconsin.
The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.