Posted by Nick Jervis of Samson Consulting, a Legal Futures Associate
There have been various articles in the legal press recently stating that conveyancing services can only ever be judged on price. Now, I know that this is certainly not the case. I know many solicitors that still charge an incredibly reasonable fee for their services, yet I also come across many others that are constantly lowering their price simply to secure the instructions.
If you look outside of the legal world, you can see many examples where pricing is not the determining factor. I could buy my food from Waitrose and pay a premium or I could shop at Asda, Lidl or Aldi. The food will be largely the same but the price paid will be significantly different. Food is the largest commodity, so if a food retailer can manage to charge a higher price than other food retailers, then why should it be any different for solicitors?
If I want to buy a car, I could buy a Smart car or I could buy a top-of-the-range Mercedes. Both cars do exactly the same job of transporting me from A to B; however, one of them does so in far more comfort and probably a lot faster. Should it not be the same with conveyancing? If I decide to buy purely on price, you and I know that the conveyancer charging the lowest price will have to take on five or 10 times more files each month to make the same profit as a conveyancer charging a reasonable fee and handling half the number of cases.
On the flip side of this, the fee-earner charging more will have more time to spend on my file and therefore is less likely to make mistakes. With insurance premiums always on the rise, this is a good thing for the practice overall. I have worked with conveyancers who charge a low fee and have rarely been impressed with their client relationship management skills. However, someone who is sufficiently confident to charge a decent fee for their services normally is far more assured and relaxed, and more prepared to spend time with their clients. They are able to offer the Mercedes or Waitrose service because they are charging a premium for the privilege. The solicitor and the client both win. Isn’t this better for all concerned?
It is even easier to charge a premium for your service if your are regularly selling your service to returning clients or recommended clients. You are far more likely to have returning and recommended clients if you go out of your way to provide an exceptional service. Of course, there will always be the “tyre kickers” who only want to buy on price, but let them go to your competitor. In my experience both in the legal profession and since leaving, those that are prepared to pay a reasonable price for my service are normally the best clients. Those that always try and bargain on price or time turn out to cause the most headaches.
I have seen this enough times and spoken to enough solicitors to know that this is a recurring theme. Therefore, if someone is bartering your price and does not appreciate any value to your service let them go to your competitors and let your competitors have the headaches.
You can choose whether you want to be a low-price conveyancing service provider or a high-price conveyancing service provider. I firmly believe the second option is the right choice but also accept that this takes time to achieve. However, if you simply give in and charge the lowest prices, you will never have a profitable business in the long term. You simply will not be able to compete with the bulk providers such as Halifax or the Co-Op, and they will be able to beat you on price and delivery of service.
In my opinion, the only option for the smaller firm is to charge a good price and provide an outstanding service. You will then have more job satisfaction, more clients and more profits in the bank.