Law firms are feeling more confident about their business prospects than at any time since at least the mid-1990s, according to a survey published today.
Some 99% of practices polled by accountants Smith & Williamson (S&W) have a positive outlook for the year ahead, exceeding the previous high of 96% in 2006, just before the economy crashed.
S&W’s law and professional practices survey has been running since 1994. Seven out of 10 law firms responding this year also said competition had increased in the last 12 months, driven by new entrants to the market and new ways of working.
Giles Murphy (pictured), head of professional practices at S&W, said: ‘The survey shows an unprecedented level of confidence and is a genuine signal that activity is now exceeding the levels seen before the financial crisis. Political certainty, economic resurgence and corporate actions are driving optimism.’
The survey confirms the gradual evolution of new fee structures, with 94% of respondents expecting this to have a significant impact in the coming years. Murphy added: ‘Traditional time billing is losing favour with clients who are demanding better value and expect advisers to share risk and provide greater certainty on fees. Fixed fees, value billing, volume discounts and contingent fee arrangements are steadily gaining ground and this trend will only increase.’
Just over half (51%) of firms are planning to increase the range of services they offer in the next 12 months; 65% are proposing to grow their marketing spend; and 79% plan to increase investment in IT.
Ninety-five firms took part in the survey, a majority of which are based in the London and the south-east.