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30 July 2013

Law firms look to make changes as ABS makes impact

Alternative Business Structures (ABSs) have forced law firms to review their level of client service and increase marketing spend, according to a new study.

By Charlotte Mullen


The research, by accountants Armstrong Watson, polled 36 small firms in the UK, mostly in the North of England, and found that two-thirds of firms questioned saw ABSs as negatively impacting traditional firms. However, when it came to measuring the impact on clients, 40 per cent of respondents believed that lower prices and more streamlined services that the ABSs would provide would be a positive aspect for clients, Legal Futures reports.

Ethical standards

The survey noted a belief that the quality and ethical standards of ABSs do not stand up to those of traditional structures, with almost two-thirds citing lower ethical standards in new entrants.  Half of respondents also claimed that service would be impaired due to a lack of face-to-face contact and levels of service depending on the fee.  In terms of the way firms are responding to the Legal Services Act, the survey found that three-quarters of respondents are thinking about changing the way they provide services, improving IT systems and implementing new methods of working. Spending more on marketing may also be in the pipeline for many firms, along with attaching fixed fees to certain types of work. The survey found most respondents believe traditional law firms lack external investment opportunities, but were positive about their own firm’s prospects to do so.

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