The face of the high street lawyer is changing. Over the last decade, the number of sole practitioners has dropped from 27% to 16%, while incorporated companies have increased from 36% to 57% over the same period.
While the change in status may be attributed simply to a more efficient or convenient operating structure for some, figures from the Solicitors Regulation Authority (SRA) suggest a shift towards fewer firms employing more people.
In the 12 months to April 2025, 115 more solicitors’ firms closed than opened. More than half of those that closed (59.1%) ceased practising, with 22% merging with other firms. Over the same period, the number of practising solicitors increased by 4,661.
Looking back over the last decade, the shift in firm demographics is even more pronounced. As of July this year 173,017 solicitors are practising in 9,102 firms – an average of 19 per firm. In July 2015, the average was 12.8 per firm.
An attractive investment prospect
The legal sector has become an increasingly attractive prospect for private equity firms, drawn in by recurring revenue, low overheads and the potential for market consolidation in a highly fragmented sector.
Speaking to the Today’s Conveyancer podcast last month, Thomas Mieszkowski, partner in the corporate team at Walker Morris LLP, outlined how technology is a major factor behind the decision for firms to seek safety in numbers.
“The whole of the industry is facing questions at the moment”, he explained. “What investment do I need to make in my firm to make sure that I’m staying relevant and able to deliver services in the future? So, for example, which piece of AI technology do I invest in? Which pieces of hardware do I need? These are all quite big decisions. And not only are they big decisions, they involve capital outlay.
“So the options are, do we as a firm stick our hand in our pockets and take the risk on that? Or do we maybe look at becoming part of a larger group or getting outside investment to effectively help us fund those investments that that we need to make?”
Changing high streets require a change in approach
The changing make-up of high street firms and the large number of closures suggests that many are choosing to simply cut their losses. But for those who don’t want to lose their independence or give up their livelihoods, a change in approach may be necessary.
Research compiled by TwentyConvey in July revealed ‘an astonishingly low’ rate of customer retention in conveyancing firms, with just 11% of customers taking repeat business to their conveyancer.
And according to Simon Dawson, chief revenue officer of real estate at Outra and former director of data services and insights at Rightmove, changing populations and transient neighbourhoods mean that reputation and word of mouth (no matter how positive) are no longer enough to attract or retain business.
“The level of competition in the marketplace is a challenge”, he says. “Traditional approaches from firms who say, ‘we’ve been here for years, we rely on our community standing’, can only go so far. Local communities are growing at a fast rate, properties are being built at a fast rate, people are moving, more so than they have done over the last five years”.
The challenge of change
The legal sector is built on centuries of tradition that remain essential for it to function, and is perhaps unique in that respect. ‘Disruptive technologies’, ‘innovative solutions’ and an ever-increasing drive towards AI adoption may be helping to modernise and streamline practice, but there are many elements that cannot be replaced.
But according to Dawson, embracing change to address business challenges doesn’t mean relinquishing familiar ways of working.
“The problem for legal services – and I say this coming from a legal services background – is that people coming into the industry become native to the firm they go into”, he says. “They adopt the practices and systems of the firm that were established by the partners and the lifers in legal practice. They know what they like and they like it done that way, with spreadsheets, maybe CRM or accounting software.
“But from my point of view, the challenge for all firms is how they embrace change and ask how it will help them to become more efficient and improve client relationships. They have to address the problems and challenges they’re experiencing in their business, and from an ease of use perspective.”
Data is a friend, not a foe
Embracing change to stay relevant and afloat means embracing data, Dawson says. However, he stresses that this doesn’t mean replacing tried and tested systems with capital-draining technology, but rather taking advantage of information that already exists and using it to complement existing practices.
“When we talk about data we’re not talking about changing processes or manipulating how a customer is taken from inception to exchange”, he says. “We’re talking about identifying typical potential customers for them to grow their business.
“The use of data complements what firms already know works. It gives them the ability to accurately target people who might not know the firm, so they can build trust and affinity.”
In practice, this means incorporating in-depth data analysis into traditional marketing and business development. Analysing historic property events, general market dynamics, transaction data, demographics and population statistics enables firms to accurately identify the pockets of the market that are likely to need legal services.
Marketing and business development can then be finely targeted towards those areas, while keeping costs under control.
A targeted approach
“The reason why that’s particularly useful for conveyancers is it enables those particular businesses to develop top of funnel strategies to engage with the people most likely to move in a defined period”, Dawson explains.
“We combine market data in terms of what properties are likely to come on the market and their characteristics, then blend that with demographics and other behaviour points to identify who will move and why.
“For conveyancers, it’s more important to understand those properties that are about to come on the market. The other thing we’re able to do is identify the properties sold subject to contract, allowing conveyancers to market to those households in a very targeted way.”
By identifying the hyper-local segments of the market most likely to be actively seeking services, the firm can then create targeted communications – whether that’s finely tuned digital ads or branded hand-delivered mailshots – that will be relevant, welcome and appreciated, to establish trust and build loyalty.
Healthy competition
In an industry under scrutiny for its dubious practices of cross-selling and referrals, the strict privacy laws surrounding the gathering, storage and use of data offer an ethical way for firms to cross-sell and compete.
“We don’t trade in personal info”, Dawson stresses. “When we talk to conveyancers and lawyers to understand what they’re trying to achieve, they tell us it’s ethical and compliant customer relations. What we’re able to do is identify where they can find customers to establish and build those relationships in an informed way.
“When that trust bond has been established and the customer has had a good experience, they’re more likely to use the firm for other services. There’s still very much a place for traditional marketing; it’s just much more targeted and efficient so you can influence in the right place at the right time.
“With a growing focus on consolidation and commissions, firms need to explore different and more effective ways of attracting customers organically and creating that bond of trust to keep them.
“Clients need to be able to make an informed choice and firms should be supported to exist in a balanced playing field. If it’s not a legitimate choice, then it’s not a choice at all.”
