Law firms across Scotland are invited to take part in a survey to assess the financial health of the legal sector.
The 2018 financial benchmarking survey, carried out by independent researchers Tribal on behalf of the Law Society of Scotland, helps firms of all sizes, from sole practitioner and high street firms to large scale commercial firms, assess their financial health and how they are performing in the legal market.
The confidential, online questionnaire, which opens on Tuesday 13 February, has been improved and streamlined since its launch in 2017, to make it even easier for solicitors to complete.
Taking part allows firms to view and compare:
- income and costs by the size or location of a firm
- a breakdown of the firm’s total costs
- cashflow management
- the relationships between the different results, e.g. plotting your firm’s staff costs against profitability
Graham Matthews, President of the Law Society of Scotland, said: “Knowing just how your business is performing is a crucial aspect of running a successful law firm and I would encourage all firms to take part and use the survey as part of their business management toolkit.
“In addition to providing an overview of how the sector is performing overall, the individual, interactive online reports really help to bring firms’ financial data to life, enabling solicitors to assess how their own business is faring year on year and help them make the right strategic decisions for their business and its future development.”
Sue Carter, UK Head of Professional Services Sector at Clydesdale Bank, which is sponsoring the financial benchmarking survey, said: “Firms that choose to participate in the survey can easily demonstrate to their bank how seriously they take financial management. The findings should inform strategic decisions and enable questions to be asked such as ‘why are you performing differently?’ or ‘what needs to change or remain the same?’. Benchmarking your own firm against trends and your peers can be a valuable aid to making the right decisions for your business.
“Clydesdale Bank’s Professional Services Sector team has first-hand insight into the unprecedented levels of change that continues to reshape the legal services sector. We want to add value and facilitate growth to ensure firms continue to be successful.”
Findings from 2017’s financial benchmarking survey, which replaced the Law Society’s previous cost of time survey, showed that profits per partner (before outlays) for the respondent firms have remained relatively static since 2014’s cost of time survey of the profession, at £69,000. The results indicated that some smaller firms were closing the gap on their larger competitors, with 2-4 partner firms showing an 11% increase in median profit per partner levels to £82,000. This compares with 5-9 partner firms, which showed a 4% increase to £96,000 profit per partner. Bigger firms of over 10 partners showed the highest profits per partner at £125,000.
Email invitations to participate in this year's survey will be sent to law firms’ cashroom partners. All responses go to research company Tribal and are confidential. The survey closes on 23 March 2018.
To read the report on the 2017 survey findings check the financial benchmarking pages on the Law Society’s website.