Baker Tilly’s Steve Carter says law firms may be hit unexpectedly by referrers

THOUGH law firms have faced some pretty stiff challenges over the last 12 months, there are new issues cropping up all the time that have the potential to have a considerable impact for many years.

The high and unavoidable cost of office space that far outstrips short-term requirements is one immediate concern.

There’s also the question as to how a high- quality client service can be delivered when the upturn arrives from teams that have been broken up as a result of the recession.

The Legal Services Act has the potential to provide a third major headache – one I suspect many firms have not yet thought about.

I’m not talking about the threat caused by organisations with no previous legal background entering the market and pressurising existing and less efficient firms.

Though this is, of course, a justified concern for some of the more traditional firms – highly efficient practices need to be prepared, too.

These firms might feel quite secure at the moment, but it’s critical that they accept that over the next few years they may also lose work to new entrants in other ways.

Not from the likes of Tesco but from their traditional referrers of business, who may indeed decide that they can offer legal services themselves.

The Legal Services Act will dramatically affect the profession – sometimes in unexpected ways.