With the Virtual Pricing Director Pricing Espresso® we aim to bring you your pricing 'shot' - some of the most interesting, thought-provoking and informative material we can find globally which will be of interest, relevance and help to you in your firms' pricing challenges.
Law Firm Mergers and Their Orphan - Pricing
Synthesising two law firms represents a huge challenge, even if the balance sheets and P&L accounts are relatively harmonious. The challenges associated with blending culture, values and behaviours are well understood.
Less well understood and in fact often largely ignored is the compatibility of the two firms pricing cultures, resources, governance, and execution. Most law firm partners, and management would acknowledge that there is often little cohesion on pricing in their own firm, let alone adding another firm to the mix. Read more...
Law firm pricing professionals in 2023: Examining compensation & team structures
A new report looks at how compensation is being structured for pricing professionals and pricing teams within law firms
The economic uncertainty greeting the start of 2023 is, for many, calling to mind comparisons to the last great economic downturn that truly impacted the legal market: The Great Recession of 2007-‘08. Fortunately, many law firms today find themselves in a fundamentally different position from which to confront today’s pricing pressure in particular due to investments made in their legal operations functions over much of the past decade, specifically in their pricing leaders and support teams. Read more...
As Profits Dip, Firms Could Face 'Increasingly Difficult Decisions' Ahead
Law firm rate structures are already mostly in place for 2023 and firms are generally reluctant to walk them back, according to authors of a new study from Georgetown University and Thomson Reuters.
High expenses, high associate pay and lower profits per partner may force law firms to make “increasingly difficult decisions” this year and beyond, according to a new report.
The 2023 Report on the State of the Legal Market, published Tuesday, concluded that after a 0.1% drop in demand last year, Big Law will likely rely on significant rate hikes to maintain profits this year and next year. Read more...
Five lessons on how not to do pricing from Elon Musk’s Twitter
There is a perfect pricing case study in the way the new Twitter CEO, Elon Musk, communicated his proposed fee for a ‘blue tick’ on the platform – just do the exact opposite of what he did.
I have about 35 different feelings about Elon Musk. They range from positivity bordering on adoration (Starlink for Ukraine), through to neutral (The Boring Company), to disgust (animal experimentation for Neuralink). Read more...
Quoting only hourly rate unfair, EU court rules
A legal services contract simply quoting an hourly rate, without any estimate of the cost of the matter, does not satisfy the requirement of being drafted in plain intelligible language, the Court of Justice of the EU has ruled.
The decision, in DV v MA, will not directly affect the regulations covering legal pricing transparency in England and Wales. However Gazette columnist Jonathan Goldsmith points out today that the ruling, on a point of EU consumer law, illustrates some of the difficulties posed by the government's Retained EU Law Bill. Read more...
As Productivity Drops, Will More Law Firms Move Away From Billable Hour?
Law firm pricing that emphasizes value instead of time may follow the drop in productivity.
Alternative fee arrangements and pricing outside the billable hour is getting more attention this year.
A pandemic surge in demand followed by an historic drop in productivity have set the stage in 2023 for a shift toward pricing that emphasizes value instead of time, some analysts say. Read more...
Rising Rates Are Law Firms’ Salve Amid Layoffs, Pay Cuts (1)
Headlines about the law firm business seem gloomy.
Some firms are laying off associates. Many are set to pay partners significantly less than they did a year ago. Most expect another year of depressed transactional and capital markets work—a huge driver of profits.
But cheer up, law firm managing partners. It looks like your business is still great at an extremely important thing—raising billing rates. Read more...
Strategies to minimize the impact of law firm rate hikes
When law firms inevitably try to raise their rates, there are cost-containment actions that corporate law department leaders can take to mitigate the impact
The significant social, economic, and inflationary pressures that have been building for the past year or more have created a new dynamic in law firm pricing structures which has resulted in a tectonic pivot that has moved pricing leverage away from clients and in favor of law firms and alternative legal service providers (ALSPs). Read more...
With Such Low Win Rates, Should Law Firms Respond to So Many RFPs?
In this edition, we share some preliminary findings from a recent study conducted with marketing and business development professionals. The low winning percentages on pitches and RFP responses really jumped out from the initial findings. As the time needed to properly support new revenue opportunities increases, low winning percentages will continue eating into profit.
Key Takeaways on Law Firm Marketing in 2023
- Law firm marketing will be more important this year than in the several years prior Partners got complacent in a time of high demand and now they will need to work harder to bring in business Read more...
Firms 'moving away from billable hours'
Client demand is driving a growing number of law firms to move away from the billable hours model – however, the shift towards alternative fee models does not necessarily spell the end of lawyers billing in six-minute increments, according to a new study by LexisNexis.
With nearly half of all external legal spend taking place through alternative fee arrangements, such as flat or fixed fees, LexisNexis decided to explore the pros and cons of the billable hour model, the challenges of pricing matters when using alternative fee structures, and how these trends are likely to develop. Read more...
The RFP: Do We…or Don’t We? That Is the Question
Now that we have our PESO Model™ month complete, we can focus on other things. Things such as business growth, using artificial intelligence in your work, leadership, predictive communications, and more.
All of that is forthcoming (which means I have notes about each of those topics in my notebook), but today I want to focus on RFPs.
You know, the request for proposal that you receive and get all excited about it because it’s typically a large brand, and man, oh man. If you could just win this one, it would change the trajectory of your business. Read more...
Market for alternative legal services growing dramatically, new report shows
In our biennial report on the ALSP market, we find a sector that has grown exponentially over the past two years and is making great in-roads with both law firms and corporations
The market for alternative legal services providers (ALSPs) is showing itself to be a highly dynamic part of the overall legal ecosystem and one that is growing at an increasing rate as it forges new paths to serving both traditional law firms and corporate law departments. Read more...
Law.com Trendspotter: Mergers and Rate Hikes Are Poised to Create a Whole New Crop of Law Firms
It's the Circle of Law Firm Life: a period of rapid consolidation makes room for a new crop of boutique firms to spring up.
By the end of 2023, the legal industry landscape will likely be populated with a number of new law firms—and marked by a few notable absences.
The law firm merger market is already quickly heating up and we’re sure to see more big names (and smaller names) joining forces across the country throughout the remainder of the year, creating new organizations and potentially pushing some attorneys to seek new opportunities. Read more...
No Clear Winner in Faceoff Over Outside Counsel Fees
“While cracks may be emerging here and there, it’s been a very good time to be outside counsel," said Jason Winmill, managing partner of in-house consultancy Argopoint.
Legal departments expressed outrage and girded for battle last fall when their outside law firms rolled out plans for aggressive rate increases for 2023. Yet the showdown that seemed sure to come never really materialized. Read more...
Law firms less fearful of Big Four threat
The proportion of law firms saying that they have lost work to Big Four professional services competitors fell sharply last year, according to the latest snapshot of the fast growing sector.
Alternative Legal Service Providers 2023, published by Thomson Reuters, finds that the global market for non-law firm businesses offering legal services has seen compound annual growth of 20% since 2019. It is now worth $20.6bn a year. Legal services revenue at the Big Four grew from $1.4bn in 2019 to $1.5bn in 2021. Read more...
Being the best law firm you can be
On Tuesday 6 June we will hold our inaugural annual in-person Law Firm Ambition conference, on the theme of ‘Being the best law firm you can be’.
This one-day event in London’s Regents Park will feature a host of great speakers, with the same pace and quality that has made our webinars so popular.
Topics include agility, team engagement, branding and differentiation, customer experience, maximising process efficiency, technology and “managing partner secrets”. Read more...
Epic costs assessment ‘unprecedented’, says judge
A judge appears to have finally concluded an epic costs battle where the arguments over who should pay what far exceeded the length of the actual trial.
Senior Costs Judge Gordon-Saker said the 97 days taken up by detailed assessment in Deutsche Bank AG v Sebastian Holdings Inc were ‘unprecedented’ and more than twice as long as set out in the first directions hearing. Read more...
Back to the future? Costs lawyers see Belsner solution in the past
Costs lawyers have called for a return to the 1990s with a proposed procedure designed to end expensive court battles over solicitor bills.
The Association of Costs Lawyers said it wanted to work with the Law Society and legal ombudsman to revive the system implemented by the Solicitors’ (Non-Contentious Business) Remuneration Order 1994. The procedure, revoked in 2009, required a solicitor’s costs to be fair and accurate, and gave clients the opportunity to seek a ‘remuneration certificate’ from the Law Society where total costs were less than £50,000. The Society would then, in appropriate cases, issue a certificate stating what it believed would be a fair and reasonable amount for the client to pay. Read more...
Court rejects costs budgeting plea on child's clin neg claim
The High Court has rejected a defendant’s plea for a costs management order regarding a child’s clinical negligence case which could still have years to run. Master Cook stated that the policy of children’s cases being exempt from costs management should be adhered to, even if the defendant was unhappy with the costs incurred so far.
The parties in CXS v Maidstone and Tunbridge Wells NHS Trust had agreed at a previous case management conference to stay the claim until 2027, at which point the claimant would be 12 years old. She sustained a serious brain injury at birth and liability was admitted in full by the NHS trust in 2019, but damages remained in dispute. Read more...
Costs protection still in place for last-minute discontinuance, rules CoA
A claimant who discontinued his personal injury case on the morning of trial should still be entitled to costs protection, the Court of Appeal has ruled.
The defendant in Excalibur & Keswick Groundworks Ltd v McDonald had sought to argue that claimant Michael McDonald should lose the cover of qualified one-way costs shifting for wasting court resources. Read more...
Dentist expert witness wins appeal against £50,000 costs order
The High Court has overturned a £50,000 costs order against an expert witness who had been accused of disregarding his duty to the court.
Overturning the order made against dentist Dr Chris Mercier, Mr Justice Sweeting said there was ‘nothing illogical or partisan’ about the evidence and conclusions provided in a clinical negligence matter. Read more...
Costs shock as CPR changes reverse claimant protection
Claimant lawyers were left reeling today after rules were quietly amended to allow costs recovery from settlements. Experts say the amendments to the Civil Procedure Rules, enacted through statutory instruments passed yesterday, reverse court rulings in Cartwright and Ho so that defendants can set off costs not only against orders but also deemed orders and agreements to pay damages, as well as claimant costs.
Nick McDonnell, director of costs firm Kain Knight, said claimant solicitors ‘must buckle up’ to prepare for the changes, which apply to all claims issued after 6 April. Personal injury barrister David Green said the rules had been ‘radically redrafted’. Read more...
Fixed recoverable costs for housing kicked into long grass
The government has confirmed it will delay the implementation of fixed costs in housing cases for two years. The Ministry of Justice said that it remains committed to the principle of fixed costs but wanted to wait to see the effect of other changes in the sector.
But ministers are resolute that the extension of fixed recoverable costs for other civil cases will go ahead as planned from October. Read more...