Posted by Andrew Lloyd, managing director of Legal Futures Associate Search Acumen
Many people in the business world will tell you that transparency is optional – especially for small businesses. They’ll tell you that so long as nobody is demanding information from your company, you don’t necessarily have to be forthcoming. In this digital age, this attitude is having to change.
There is always value in keeping certain information safeguarded, but transparency in some areas can make for a healthier marketplace.
Research the Bar Standards Board carried out into 368 legal firms found that 75% made no reference whatsoever to fees on their websites, while just 8% provided numbers on their fees/prices.
There are similar issues in the other parts of the legal profession, and to tackle this, the Solicitors Regulation Authority (SRA) has recently confirmed its support of the Competition and Markets Authority recommendations for the publication of prices for firms in certain areas of law, including conveyancing, in an attempt to collapse the barrier between services and consumer access.
In our opinion, publishing ‘typical’ prices for conveyancing is not real transparency and won’t solve the problem the SRA is trying to remedy. A more accurate and tailored approach is imperative and we hope will be supported by the SRA.
Overall, this is a good move that promises clarity and choice for homebuyers and sellers, but there are naturally some concerns.
Many fear that publishing figures could ignite a race to the bottom as firms try and outdo their competitors’ fees. Premium prices don’t guarantee premium service but, if managed wrongly, a price war could compromise standards of service with people simply selecting the cheapest option.
While fears of a ‘race to the bottom’ are valid, they may also be overstated. Price transparency exists in nearly all aspects of our lives, yet people still choose to pay a higher price for a higher quality of service.
If the race to the bottom was a valid concern, there would be no Waitrose customers, only Aldi.
On the other hand, there is a more positive view to take. The UK’s productivity is so poor that the average German worker could go home early on Thursday afternoon and still have produced as much as the average Brit who toiled all the way through Friday. Greater transparency can help us grab this issue by the scruff of the neck.
Transparency does not simply enhance efficiency. In the conveyancing sector it is also a key ingredient to a trustworthy relationship with a customer. The number of conveyancers operating in the UK is shrinking and it has never been more vital that firms remain competitive to stay afloat.
Yes, we could witness a price war, but this will enable progressive firms to price competitively and innovatively differentiate themselves in other ways.
Here at Search Acumen, with our online quotation tool for conveyancers, we welcome the steps taken by the authorities on price transparency. If managed effectively the industry can harness its access to data and the increased competition on fees to reach new levels of customer service and bridge the widening gap in UK productivity.