RALEIGH, North Carolina, April 17, 2019 /PRNewswire/ -- The current global market for legal services is growing at a CAGR of 2 - 4 percent annually, according to Beroe Inc, a procurement intelligence firm. A sufficient recovery from the recession and Eurozone crisis has acted as an accelerator for improving the demand scenario for legal services.
More than 60 percent of the legal spend is concentrated in the developed legal markets of North America and Europe, and the maturity of legal service providers in the regions is high as they command the highest market share. The APAC region has the highest potential for growth with many global legal service providers entering the industry.
Beroe, which is based in North Carolina, further stated that procurement experts can access this report on its recently launched market intelligence platform Beroe LiVE: live.beroeinc.com
Increasing demand for transactional practice areas such as corporate work, real estate, and tax work is driving the demand for legal services. Rising demand from the emerging markets such as the APAC region and the Middle East has also been driving the market for legal services. However, there is a mounting pressure to adopt AFAs (alternate fee arrangements) and transparency to billing standards poses to be the major challenge in the industry.
The growing availability of information on the law firms' capabilities, commoditization of legal services, increased use of technology, the emergence of non-traditional service providers, and the increasing power of in-house general counsel have transformed the legal market into a buyers' market. Moreover, buyers are driving matters such as scheduling, staffing, and the scope of work & pricing.
With the fulfillment of BREXIT rapidly entering the EU countries, the legal industry in many of the major markets is rising to the situation by increasing the number of law firms giving English law and other dispute resolution matters in English.
A lack of consistent service quality and data security issues have acted as constraints in the legal services market when work is being outsourced to LPO offshore locations.
In countries such as Argentina and Brazil where the local jurisdiction comes into play (IP and patent cases) and the firm needs a patent filing, patent licensing, patent prosecution etc., local technical expertise comes into play because global firms might not be as effective.
With more multijurisdictional engagement with law firms, the Fortune 100 companies enjoy good negotiation and bargaining power, and they have outside counsel spending that comes to about three times as much as that of non Fortune 100 companies.
Procurement must enable risk sharing with outside counsel and evaluate the factors such as the volume of the transaction and the nature of the matter to determine which pricing model is to be adopted.
Most of the global service providers are present in North America, and they command the maximum market share. High revenue and PPEP ratios indicate higher maturity levels of service providers with several boutique law firms.
The research methodology adopted for the report included:
Experts with twenty years of domain experience
Interaction with buyers
Inputs from supply chain partners
Cost reduction and the need for better utilization of internal legal staff for strategic services have led to more work being outsourced to LPO units in low-cost destinations. Furthermore, favorable government policies, measures taken to liberalize and deregulate policies, reduced licensing requirements and the prospective removal of restrictions on Foreign Direct Investments (FDIs) are driving the market for legal services and the need for work to be outsourced to low-cost offshore destinations.
The report also includes:
Market Maturity and Trends
Drivers and Constraints
Regional Market Outlook
Porter's Five Forces Analysis
Cost & Pricing Analysis:
Law Firm Pricing Structure
Procurement Best Practices:
Best Practices for Outside Counsel Management
Billing Rate Benchmarking:
Average Indicative Billing Rates: US and UK
Key Factors Impacting Rates for Legal Services
Billing Rates: Methodology
About Beroe Inc.:
Beroe is the world's leading provider of procurement intelligence and supplier compliance solutions. We provide critical market information and analysis that enables companies to make smart sourcing decisions—leading to lower costs, greater profits and reduced risk. Beroe has been providing these services for more than 13 years and currently works with more than 10,000 companies worldwide, including 400 of the Fortune 500 companies.