Legal conferences and training group Central Law Training has published the results of a survey it conducted in October looking at the fears of small to medium sized High Street firms (defined as between 4 and 12 partners - there are about 1800 of them in the UK) in the light of the proposed changes to legal aid and legal services.
The key conclusions found were the following:
- 97% of respondents thought that running a small to medium legal practice over the coming 5 years was going to become more difficult.
- The entry of new entrants, as facilitated by the proposed Legal Services Act, and the further commoditisation of services were seen as the two largest threats to small to medium sized law firms.
- 57% of respondents thought that branded, household name new entrants were the single biggest threat.
- 41% thought that retailers and supermarkets would be the most likely to enter the legal services market.
- Conveyancing and wills and probate were considered to be the areas of practice most at threat.
- The most considered responses to these threats were to move out of low margin areas of practice that are prone to commoditisation, and to move into higher margin, niche areas of legal service provision.
- Marketing and practice planning were identified as the greatest challenges within business practice management.
- 80% thought that the Law Society was failing to both fight their corner at the political level and provide adequate support and advice on business planning.
- Although Multi-disciplinary Practices have yet to feature highly on the list of strategic options for law firms, 82% of respondents say that the advent of Home Information Packs might prove to be a catalyst for the development of MDPs in the future.
The Future of Small to Medium Law Firms in the UK