Law Leaders: Pricing Pushback by Clients Here to Stay

May 25, 2012 – In The News
Philadelphia Business Journal
A recent survey conducted by Altman Weil shows that many law firm managers believe that some of the changes in the competitive environment are permanent fixtures and not temporary inconveniences. For example, almost 92 percent believe that more price competition is here to stay, compared to just 42 percent three years ago.

Mark L. Silow, Firmwide Managing Partner at Fox Rothschild LLP, recently spoke to the Philadelphia Business Journal about these economic trends. Silow said that at the start of the recession the first reaction from law firm managers was that it would be a relatively short cycle like the downturns in the early 1990s and early 2000s. But managers realized the economic atmosphere was different when clients began to balk at increased annual billing rates at twice the level of inflation and hiring large numbers of entry-level associates, paying them large salaries and billing them out to clients at high rates.

“What the recession did was open the eyes of clients and shift the balance of power from firm to client permanently,” Silow said. Furthermore, Silow believes that the key change is the development of more commoditized legal work. He thinks all of the other changes flow out of that.

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