ABS: No crystal ball required

So just what is going to happen to the legal services industry (and in particular the retail end of the market) once ABSs are with us at the end of this year?

Looking at how the conveyancing industry has evolved over the course of the last decade provides a clear blueprint.  This arena has already been largely commoditised.  Volume providers now dominate the industry.  They all have in common increased use of IT workflows, offshore outsourcing, commercial management team structures and lawyer displacement.

The reason for the development of volume models in conveyancing is not because it is a simple process (ask any conveyancing solicitor), but mostly because ABSs have been around for some time in the conveyancing world.

The Council for Licensed Conveyancers have allowed external ownership and investment in law firms for over a decade (and so have a head start over the SRA in regulating ABSs – they already have experience of what that needs to look like and what the “coal face” challenges are).

And the impact has been astonishing.  Out of the top 10 volume providers 1/3 are licensed conveyancing practices, despite the fact the that CLC practices make up less than 2% of the overall number of regulated legal practices.

But its not just financial advantages which externally funded law firms have over  traditional solicitors.  More of a challenge is that they generally form part of larger groups which can generate a constant flow of work into the legal arm of the business – the Countrywide model.  How law firms compete with this remains to be seen.  A good start for all legal practices is to ring-fence their existing client database.  Communication, communication, communication being the key.

So do we need a crystal ball to see what the future holds?  I think not. I would confidently predict that volume legal brands with existing access to sources of work (or databases to create work) from other parts of the group will come to dominate retail legal provision within the next 5 – 10 years. There, I’ve said it.  Anyone fancy a fiver on it?

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One Response to “ABS: No crystal ball required”

  • Paul says:

    It is an exciting time we live in.

     


 

 

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