If Charles Darwin were alive today, what would he say about the world of Solicitors? As a reminder, Darwin wrote: 'In the struggle for survival, the fittest win out at the expense of their rivals because they succeed in adapting themselves best to their environment.'

The exciting news that private equity funding has reached the high street with an investment in QualitySolicitors is the beginning of a world of opportunity for those law firms who are prepared to evolve and develop. The investment in QualitySolicitors is likely to spark interest from other private equity funders looking for a foothold in the legal sector. Many of these have been sitting on the fence waiting for someone to jump - well now they have!

A deregulated market will always grow. The legal services offering could effectively double in the next five years to 4% of the gross domestic product (GDP) - a staggering £50bn. We are aware of the declared numbers of "brands" entering the market in the next few years and are also aware of the various affinity schemes gearing up to offer legal services to their customer base. With Rocket Lawyer and Legal Zoom, the US document delivery businesses, entering the UK legal services market, the competition will be fierce.

The big question is who will be the winners in this new competitive environment - the new entrants or well run regional and niche solicitors practices? A national brand such as QualitySolicitors was an obvious starting point but what does this mean for other regional solicitor practices?

Even the SRA is recommending law firms of all sizes to consider alternative business structures. Speaking at a recent Conveyancing Association meeting, Samantha Barrus, director for corporate regulation, stated: 'The Legal Services Act presents an opportunity for the high street. The reforms will widen the service offerings and refocus the business.'

If we therefore follow Darwinian theory, those firms that are well managed and are run as a business will have the opportunity to compete. A key feature in any law firm with aspirations of success is the need to 'raise their game' and apply business logic to running their practice.

The first hurdle has to be corporate structure. With 25% of legal practices now trading as limited companies, this has two definitive advantages. Firstly it will encourage younger owners to become involved without the burden of equity partnership - limited liability is an attractive option. Secondly it prepares the law firm for potential outside investment with the directors drawing salaries and leaving profits in the business to pay dividends to shareholders.

In one recent example a specialist two-partner family law firm were sitting on nearly £600,000 in their capital account and over £13,000 in their bank account with no idea how to get the cash out of the business. By converting the partnership into a limited company and turning the capital account into a loan account the two directors could draw down their loan account over the next five years from profits and at the same time encourage younger future owners to become directors and prepare these new owners for the succession plan now in place.

Having a clear vision and strategy to achieve your personal goals is essential and in many instances law firms do not possess the necessary skill sets to implement such change in their practice. This should give some hope to numerous solicitors’ practices that should not just throw their arms up in despair but engage in some visionary thinking about their future. In his book The E Myth, Michael Gerber refers to people working on their business and not in their business.

How many partners continue to concentrate on their billing targets which, although important, should only be part of their focus? We have no more time to play at being ostriches continuing to bury our heads in the sand. Those firms who are now embracing these sweeping changes will be the winners in this battle for survival.

It’s still not too late, but engaging in this change management process is becoming essential if firms are to survive. The Australian market deregulated solicitors some ten years ago and despite sweeping changes with new brand entrants at the time, most of these have gone. We are left with one large well-known brand - Slater & Gordon - which is recognised by a staggering 80% of the Australian market (this was following stock market flotation, national television advertising and the rest).

The remainder, however, are proper businesses and are run as such with external management, financial directors and business development specialists. They had to raise their game to survive and only the strong have made it.

The future

So what does the future hold for solicitors in the UK? The solicitor brand is grossly undervalued and the suppliers of legal services play on that fact. As we know, as a non-solicitor supplier of legal services, they do not need the same skills and qualifications, they are not regulated by the SRA and do not have to comply with the outcome-focused regulation. Moreover they do not pay anywhere near the professional indemnity fees that a solicitor does.

We know it’s not a level playing field but solicitors have to rise above this and look inwardly at each practice’s unique selling points (USPs) - most practices actually have one or more. The skill is recognising what they are - and focusing the practice in these key areas.

However, the new Code of Conduct with its "outcomes-focused regulation" (OFR) is presenting a different challenge. One-in-ten firms is now closing because they cannot afford to comply with the new regulations. Overall 9% of firms were planning to close or merge as a result of compliance costs - 11% of small firms and 5% of medium and large practices - as highlighted in a recent Law Society survey.

There will be huge consolidation in the legal sector in the coming years and mergers are happening on a regular basis. In fact, I predict we will see this escalate during 2012 to record levels as more firms realise, in the cold light of day, that they cannot survive alone.

However, with the correct guidance and an appetite to retain your independence, I am convinced that there is a massive opportunity in this fast growing sector to develop your brand and not only be a survivor but emerge as a real winner. If your local competition is not seizing this opportunity then it is essential that you do, if you want to be part of this exciting future.

Viv Williams is Chief Executive of 360 Legal Group