LAW firms have toughed out a challenging year to grow their fee income by an average of 6.6 per cent – a healthy increase on the previous 12 months.
An annual survey released today of the top 100 law firms by global revenue has shown that growth in improving across the sector despite operating against a backdrop of largely stagnant marketplaces and a gloomy marco outlook.
Overall fee income across the firms polled for Deloitte’s quarterly legal sector survey was up by 6.6 per cent, a larger increase than the 3.9 per cent average rise seen in the previous 12 months.
“The figures for the year show a positive level of fee generation, especially when considering the current financial climate,” said Deloitte’s Jeremy Black.
Interestingly, the firm’s ranked 26-50th in the revenue leagues turned in the strongest performance – their fee income shot up by almost 10 per cent – suggesting that so-called mid-tier firms are adjusting more readily to new challenges that the sector is facing.
“There’s certainly more competition as a result of the new Legal Services Act,” said Black. “With a potential surplus of suppliers firms need to work out a unique selling point and think much more strategically about where their future, particularly when planning office openings and lateral hires.”
The introduction of the Legal Services Act last October has dramatically liberalised the UK’s traditionally closed legal market, opening the door to high-street players such as The Co-operative to offer legal services to their customers.
Despite the tricky background, firms are still targeting expansion over the coming 12 months, forecasting fee income growth of 6.7 per cent for their first quarter and an annual increase of 5.7 per cent.