Richard Abbott
Editor of Yorkshire Business Insider
In Focus: Evolution not revolution
Editor Richard Abbott finds Yorkshire's lawyers are relaxed about the impending 'Tesco law'.
Due to enter law next month, the 'Tesco Law' or the Legal Services Act, to give it its proper title, has the potential to revolutionise the way we buy advice – but don't expect the legal world to change overnight.
By opening up the ownership of law firms to alternative business structures (ABSs), the act paves the way for businesses such as The Co-operative, with its established customer base and media exposure - to enter the legal services market.
Local law firms are also expected to change shape, with Irwin Mitchell planning to convert to an ABS and target mergers and acquisitions.
As part of the research into Insider’s Yorkshire legal review (you can read the full report in our October issue), I've been asking local lawyers how they expect the new legislation to change their business.
And judging from my conversations over the past week or so, most are adopting a "wait and see" approach, with few predicting major changes overnight.
New entrants to the legal service market will look to operate in areas in which they can make a significant margin. Local lawyers told me this will affect the more commoditised end of the market, with conveyancing expected to be one of the first areas to be exploited.
In order to protect the value for money they can offer clients, some law firms are looking at relocating some of their back office functions to lower-wage economies.
Service will become key differentiator. The timing of a new press and poster advertising campaign from The Law Society is deliberate, calling on consumers to "choose quality advice" and associate solicitors with a high quality of service.
The campaign, which launched this month and includes advertising at key commuter travel points across Yorkshire, underlines the fact that your relationship with a law firm, whether an individual or a corporate, ultimately comes down to a relationship with an experienced and trusted advisor.
If conveyancing is the first battleground for new market entrants, expect the implications of the act to eventually ripple through to commercial services – although the law firms I have spoken to are united in their belief that this will take years, not months.
To prepare for this challenge, many are reviewing their strategies, in order to be crystal clear about their specialisms. If it wasn't already, marketing will be key.
Officially, the full provisions of the Act come into play on 6 October. However, this is likely to be affected by a delay in the Solicitors Regulation Authority's approval process for ABSs. The SRA hopes to be able to license ABSs before the end of the year.
Rather than changing the shape of the legal services sector overnight, the Tesco Law looks set to be a slow-burner.
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About Richard
Richard Abbott is editor of Yorkshire Business Insider. He is an experienced business journalist, who joined the magazine in spring 2010. He was previously deputy editor of Marketing and of Campaign Middle East, and features editor of Media Week.
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