Legal Services
Firms in this industry provide the services of lawyers and other legal practitioners to individuals, businesses, government agencies, and nonprofits. Major firms include Baker McKenzie; Kirkland & Ellis; Latham & Watkins; and Skadden Arps (all based in the US). Allen & Overy, Clifford Chance, Dentons, DLA Piper, and Freshfields Bruckhaus Deringer are all based in the UK.
Besides the US and the UK, key markets for legal services include Australia, Canada, France, Spain, and the Netherlands. Emerging markets, with growing numbers and values of deals, include China, India, and other parts of Asia.
The US legal services industry includes about 180,000 establishments (single-location firms and units of multi-location firms) with combined annual revenue of about $300 billion. In addition to offices of lawyers, the industry includes establishments that provide paralegal, notary public, process serving, and patent agent services.
Competitive Landscape
The overall health of the global economy, and the corresponding volume of commercial transactions, heavily influences demand for legal services. Large firms achieve success by working on cross-border cases for multinational clients and constantly expanding their industry practice areas. Small firms rely on serving local clients and developing expertise in a few practice areas.
Firms large and small stand out by touting pro bono work, diversity, and corporate social responsibility. The industry faces several potential disruptors. Client law firms are relying more on in-house legal teams. Legal professionals like document preparers, paralegal technicians, and virtual assistants are doing some tasks lawyers used to do. Online legal documents, chatbots, and self-help websites are giving everyday people tools to handle some legal matters on their own.
Competitive Advantages:
Investing in Technology — Some firms have embraced artificial intelligence and used it to create custom tools for clients or launch in-house legal advice chatbots. Companies can also use electronic discovery, legal process outsourcing, and off-shore legal support services to reduce costs and save lawyers for complex tasks.
Corporate Structure — With so many firms now operating across borders, the need to limit liability and have flexible management structures continues to grow. Two popular corporate structures that address both needs are vereins and company limited by guarantee (CLG).
M&A — Law firms increasingly seek growth by acquisition. Large firms combine with each other, often across borders, and firms of all sizes buy smaller companies to add expertise in certain industries or offices in certain countries.
Companies to Watch:
Dentons is one of the world's largest law firms, serving private and public clients in about 75 countries. The firm has a strong presence in the Asia/Pacific region and has recently expanded its practice in Morocco, Egypt, and South Africa.
Carbon Law Partners gives individual attorneys an umbrella company while each one is still a limited liability corporation of one. The company, which has offices in three UK cities, offers lawyers administration and back office services along with the chance to look like they are part of a larger organization, in exchange for a small fee.
DoNotPay started as a bot to help people fight parking tickets in the UK, with a 60% success rate. The company soon included services for the homeless and asylum seekers in the US and Canada. Recent expansions allow the bot to cover 1,000 consumer and workplace legal areas in the US and UK, free of charge, in addition to filing claims for credit breaches and monitoring airline fares.
Products, Operations & Technology
Civil law practices account for about 50% of industry revenue; business and commercial law account for about 40%. Labor and employment law account for
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