Lawyers still not cost-effective for small businesses, according to survey

12 November, 2015

A new survey by the Legal Services Board (LSB) has shown that only 13 per cent of small businesses believe lawyers “provide a cost-effective means to resolve legal issues”.

The new report by the LSB also revealed that only 10 per cent of small business used a solicitor during 2014, half the amount used in the year before (20 per cent).

An online survey of 10,528 people in small firms and not-for-profit organisations, carried out by YouGov in March this year, provided the data for the report.

It showed that Small businesses that obtained help with a legal problem were more likely to involve accountants (21 per cent) rather than solicitors (15 per cent), with a further 5 per cent using barristers.

When the 1,300 people who had actually used a lawyer were asked whether it was “easy to find a suitable legal services provider that I can afford”, 53 per cent agreed and only 18 per cent disagreed.

While only a small percentage think lawyers provided a cost-effective service, when those who had taken legal advice were asked what was the most important factor when choosing a provider? 30 per cent said reputation, 25 per cent said specialist knowledge and less than 16 per cent said cost.

Improvements to the economy are thought to be one of the reasons behind this sharp fall in the use of solicitors, with the average number of legal problems experienced by each small businesses falling from 21 to 13 in a year.

Sir Michael Pitt, chair of the LSB, said the research provided “further worrying evidence” that the legal needs of small businesses were not being satisfactorily met.

“These findings suggest that small business access to and use of legal services has improved little since we first looked at the issue two years ago.”

“Legal problems can have serious negative financial and health consequences for small businesses and their owners. Many of these issues can be avoided by accessing legal help at the right time. The legal sector needs to look at what it can do to fill this advice gap. In doing so it will create the customers of the future.”

At Watson Buckle our team of highly-qualified accountants and business advisers can help you access the small business market by ensuring your fees are competitive and fairly priced so that you and your clients are able to benefit.

If you would like to know more about our specialist services for legal practices, please contact us.