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Alternative Business Structures – who is in the running? Alternative Business Structures – who is in the running?

News / Articles

Aug 12

Alternative Business Structures – who is in the running?

Written by Kate Maybury
Senior Associate

DDI: 01423 724617
E: kate.maybury@raworths.co.uk

The nation is buzzing with the healthy spirit of competition, and it is not just the Olympic athletes who are competing for supremacy.  Legal services providers are facing greater competition than ever since the introduction of Alternative Business Structures (ABSs) into the legal market place.

This is exciting news for clients (or ‘customers’ as some of the larger organisations like to call their users).  It means that there is much greater choice – choice about the location of your legal advisers, choice about the level of service you receive and choice about cost.

So what has changed? The Legal Services Act has enabled legal businesses to be managed by non-lawyers and they can now be owned by organisations providing other services as well as legal advice.  This has given rise to the introduction of the supermarkets into the legal market place – hence the sobriquet ‘Tesco Law’.  Notably, the Co-operative was one of the first three organisations to become an ABS and is currently one of the frontrunners in the race for control of the legal market.  And it is not surprising that large companies with deep pockets are off to a good start.  They have the resources to throw at consumer research, aggressive marketing and strategy which some of their competitors lack.

The introduction of new entrants to the legal field is a positive step for the profession.  Greater competition means there will be progress and advancement across the board.  Solicitors have developed new ways of delivering a high quality service to their clients in a very competitive arena.  It is a challenge that forward-thinking firms are tackling head on by finding of ways to stay true to their traditional ethics whilst meeting the changing expectations of their clients.  Old-style solicitors firms will have to adapt and develop to stay in the race and sadly, some of the smaller, weaker practices have already bitten the dust.

As yet, no one knows how these changes are going to affect the legal landscape in the future – we are in the early stages of the race and only time will tell.  But indications show that greater diversity and liberalisation of the market has not improved the public’s perception and experience of the legal services industry yet.  This may be because, as more hopefuls flood the legal market, the choice for the consumer can lead to confusion.  Also, in strained economic times, if people are making choices based purely on cost, the quality of service they receive is likely to be of a lower standard and the qualifications and experience of their legal adviser is likely to be less.  As with any product or service, generally, you get what you pay for.

So our current advice is to ask around. Personal recommendation is usually the best source of information rather than an aggressive marketing strategy.

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