Don’t let soaring staff costs soak up your profit
The Legal Gazette recently reported that one of the UK’s largest law firms had seen its profits fall, in line with similar trends at other leading law firms. Despite a healthy 14% rise in revenue, profits dipped after higher salary and travel costs.
Across the board, figures suggest that firms are having to raise salaries to help staff weather the cost-of-living pressures. This is in addition to increased, post-Covid costs such as the return of business travel, higher interest rates in the UK and the generally challenging global economic situation which is affecting the majority of businesses.
According to a report by PwC in October 2023, 44% of the top 100 law firms were set to report falling profits in part due to increasing cost pressures and high inflation.
All in all, it’s little wonder that law firm profits face a squeeze, even in the face of growing revenues. As “people” businesses, law firms are vulnerable to wage growth and rises in other labour costs which they can’t control such as national insurance and mandatory pension contributions.
A sensible option for law firms looking to buck the trend and stay profitable this year is to consider outsourcing some internal functions – both legal and non-legal.
Not only do businesses benefit from significant cost savings, productivity can also be considerably improved – something which is often overlooked! Do you have qualified lawyers doing tasks that could be carried out by a skilled PA or clerk?
Outsourcing to a trusted partner also enables firms to remove the burden of recruitment and day-to-day management, leading to further savings.
What we do
At Global BPO we work in close collaboration with our clients to provide high-quality, cost-effective staffing solutions across a broad range of roles (legal and non-legal).
We save our clients the direct costs of employment as well as the indirect costs of recruitment, management and office space.
In our previous blog: Law firms fear high people costs and overheads in the coming year, we set out how Global BPO can help deliver staff with skills and experience that may currently be difficult or impossible to source, in a highly cost effective way.
How can we help you?
For more information and to find out how we could assist you, contact our Client Manager, Suzie Young, at: email@example.com.