Business Legal services 2013 05/29/2013

The B2B (business-to-business) legal market covers a wide range of legal issues, industries, and clients. Legal issues covering matters such as employment, tax, corporate governance, business contracts, leases, and health and safety tend to create regular demands for legal advice. Other issues such as M&A (Merger and Acquisition) activity, company set ups or restructuring and insolvency are likely to crop up less often. Companies across all industries may have a need for legal advice and, as a general rule, larger companies require more frequent and often more detailed legal advice than smaller businesses.

The last YouGov SixthSense report on the B2B legal market (published in 2011) came at a time when the market was struggling to recover from the economic downturn and the global financial collapse. The market is now undergoing steady, if modest, growth - but there are still uncertainties for many law firms in the market and some sectors, such as commercial property and merger and acquisitions, have yet to show any strong recovery. The largest law firms in the UK have been cushioned to some extent from the UK economic downturn through the expansion of their overseas businesses.

This report considers the UK B2B legal services market and explores some of the issues that are likely to impact on the market in the next few years. It includes an assessment of how B2B clients use legal services and how they procure these services; what specific areas they need legal advice on; the extent to which B2B users would be willing to use new, non-traditional sources of legal advice; the role of legal brands and other brands; market opportunities for new forms of delivery (such as online legal services and one-stop shops for professional services); preferences for specific pricing models; and an assessment of the potential changes likely in the market.

Report coverage

Over 20 questions were asked in total, covering the following topics:

  • Frequency of dealing with issues in the business for which legal advice is needed
  • Likely future demand for legal advice
  • Sources used to find legal advice (e.g. in-house, law firms/solicitors, external legal helplines)
  • Use of law firms and solicitors, and frequency of use
  • Use of more than one law firm or solicitor for B2B legal advice
  • Reasons for needing legal advice (e.g. employment law, business contracts, health and safety, M&A activity)
  • Membership of industry associations, employer bodies offering legal services and helplines
  • Procurement process for purchasing legal services
  • What are important criteria to consider when choosing a legal representative
  • Satisfaction levels with legal services provided
  • Interest in using alternative sources for legal advice (e.g. accountants)
  • Likely use of remote and online legal services and support
  • Perceptions of major financial services brands extending into legal services
  • Perceptions of major consumer brands extending into legal services
  • Potential use of law firms and solicitors for other professional services and use of one-stop shops for professional services
  • Fees and pricing models preferred
  • Methods of choosing legal services for a personal legal issue; use of the same law firm for business and personal legal advice
  • Awareness of B2B legal brands.

The report provides analysis of the overall survey results but also explores differences between large and small businesses in their use of legal services.

Some of the core B2B areas for legal advice include:

  • Employment law
  • Business contracts/business policies
  • Business formation/start-ups
  • Commercial property
  • M&A activity
  • Health and safety issues
  • Taxes, pensions, and other financial issues
  • Litigation and dispute resolution
  • Debt and insolvency
  • Overseas trade, investment
  • Intellectual property and trademarks
  • Injuries at work, industrial diseases

Definitions
For the purposes of this report, the following definitions are used:

  • Small and medium-sized businesses (SMEs) - businesses with an annual turnover of less than £20 million (203 SMEs responded)
  • Large businesses - businesses with an annual turnover of £20 million or more (283 large businesses responded)

In total, 486 respondents provided details of their turnover levels.

Throughout this report, the respondents to the survey are referred to as 'business executives'. For the purposes of this report, this description refers to owners/proprietors, partners, chairs, CEOs, managing directors, other board level managers, other senior managers/directors, and middle managers. For a full breakdown of respondents by employment level, please see Appendix 2 - Survey Demographics.

As noted, a previous YouGov SixthSense report on B2B legal services was published in 2011. Where appropriate, results from this 2013 study are compared with the previous survey of 580 UK businesses.

Please note that while legal jurisdictions are different in Scotland and Northern Ireland compared to England and Wales, the YouGov survey was conducted UK-wide and market size and trends data in the report is given for the UK as a whole (unless stated otherwise).

YouGov SixthSense also spoke to a number of legal firms and industry bodies.

Methodology

For this report, YouGov SixthSense commissioned a survey of 517 UK business executives in March 2013, including those from both SMEs and larger businesses. Of these, 486 identified their company turnover (see Definitions below). For a full breakdown of respondents' level of management responsibility, number of full-time employees and annual turnover, please see Appendix 2 - Survey Demographics.

Market size information (sourced YouGov SixthSense estimates) is based on a combination of primary and secondary research. Primary research takes the form of in-depth interviews with key players in the market. By speaking to a number of providers and industry bodies and by examining existing data, YouGov SixthSense has arrived at an independent assessment of market value and trends.

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