24 Feb 2022
How law firms can make conveyancing more profitable.
We brought together a panel of legal industry experts to look at how we can make conveyancing more profitable. With the market starting to slow down after unprecedented levels of busyness, the key to generating profitable work and avoiding a “race to the bottom” on fees is crucial.
Introducing our experts
Wayne McGhan is the National Business Manager at Legal Bricks, part of Access Legal. Wayne has vast experience of dealing with conveyancing departments – providing search and identity solutions as well as technology to streamline their conveyancing processes.
Lara Squires is the Owner of Consortium more than Marketing, a marketing agency specialising in advising professional services firms. As well as being a legal marketing expert, she is also an ex estate agent and ex-conveyancer.
Rob Hailstone is an ex-conveyancer with over 40 years expertise and founder of the hugely successful Bold Legal Group which he started in 2010 and whose members now carry out 33% of all conveyancing transactions in England and Wales.
First of all, we looked at generating more conveyancing work – looking specifically at referrals, with Wayne McGhan:
How do customers choose which law firm to work with?
The starting point for understanding how your law firm can generate more work is to look at how potential clients make their decisions about which law firm to use when they are looking to buy or sell a property:
Some of the latest independent research[1] shows us that:
- 25% of people use family or friends to “Recommend” a “Trusted” solicitor or law firm
- Slightly higher than this, 27% of clients are happy to place their trust in an Estate Agent “Referral” to decide which law firm they should use
- Coming in right at the top - 34% of clients will use a comparison site and instruct a firm based on cost, or perceived value for money
Let’s explore the market share we can more easily control and the one we should aim to actively penetrate: the recommendations and the estate agent referrals section – which accounts for over half the market.
Generating more “Family and friend” referrals
When clients come to a law firm without being referred, as you’d expect, around 86%[2] rate price as a key consideration, with 82% of people also citing “conveyancing specialism” as a key factor in their decision-making process. When clients are referred via a recommendation from a friend or family member, these figures change – price is a key consideration for just 32% and Trust comes top for 84%. Figures aside, let’s look at some of the key ways you can get more referrals.
- Make sure you deliver a really good service – yes, it’s a given that your service has to be great – but make sure you ask your clients for feedback – if there’s an element of your service they were unhappy with you may even be able to rectify it in the feedback stage!
- Ask! Be sure that you actually ask your clients to recommend you to friends and family – you can even incentivise them to do so with discounts for them and those they recommend.
It’s worth remembering that some of the key aspects of service delivery that customers are looking for their law firm to fulfil are:
- Transparency when it comes to pricing (make sure your pricing is 100% clear at the point of quotation and you keep your clients updated with any additional costs)
- Communication – accessibility and communication of key milestones. This is where technology can really help your service delivery – it’s not possible to be all things to all people: if you can give your clients access to key information, secure messaging and reduce the faff of endless calls, this will ensure a more streamlined and less stressful process
- Technical ability – another given but it’s important that you translate the technical side of transactions into a more easily digestible process for your clients – don’t bombard them, but do give them an idea of the process and an idea of what happens and when.
- Speed of transaction – nobody likes a long-drawn-out transaction, especially when mortgage agreements are at stake. Again, technology and digital communications will help to speed up transaction times.
Generating more work from estate agent referrals
We surveyed 50 estate agents and the number one reason that they stopped working with a law firm?
“Lack of communication and a perception of the process being harder than needed”.
It’s imperative to build relationships with estate agents to keep you and your firm front of mind and give them the confidence that you can support them and their clients through the transactional process from start to finish. Some of the key areas that law firms need to excel in in order to maintain and gain those all-important referrals, include:
Embrace Technology – Simplify the journey from quote to completion.
Of the 50 Agents we surveyed, 72% believed technology wasn’t used enough in the conveyancing process.
Provide your partners with an easy way to understand when the key milestones are met or achieved.
Of the 50 Agents we surveyed, 68% wanted a clearer understanding of what stage you were at in the transaction, without having to chase for updates.
Be clear and concise with your communications.
Of the 50 Agents we surveyed, 53% wanted a simpler way to communicate with the law firms they worked with.
We then moved on to look at how we can deal with enquiries effectively and improve conversion rates with Lara Squires:
How to convert leads and follow up with clients effectively
No talk would be complete without also thinking about conversion rates and the need to follow up on the enquiries your firm receives.
Many firms simply don’t know what their conversion rate is. So by conversion rate, we mean how many requests for a quote are actually converted to winning work and proceeding with the transaction – the estimated rate is around 40%. But why is it so low and how can it be improved? One of the first things to look at is how initial enquiries are handled and then the all-important follow-up.
How to handle enquiries to improve your conversion rates
Establish rapport
It sounds basic, but people buy people – it’s likely that your enquiry will be coming from a customer who has a few people to call to get an idea on price and the process – the more of a rapport you develop, the more memorable you’ll be and the more likely that person is to use you. Show an interest in the property they are buying and impart some of your knowledge about the area. Make sure you are an active listener who can then adapt your service offering to the needs of your customer. Conveyancers get to be involved in one of the most important and (nicest) life decisions – so a personal approach really works here.
Demonstrate value
It’s useful to remember the old L’Oréal slogan “because you’re worth it” and apply it here! Don’t be apologetic about your pricing. As consumers we all realise that we pay more for certain things (if you travel on peak time trains you’d expect to pay more, for example) – we just need to be made aware of this. So don’t be worried if you are more expensive that others, be confident in the quality of your work and your true worth. We’ve already heard how important recommendations and referrals are in getting business, so support your marketing efforts with strong testimonials and case studies – ask for Google Reviews for free or use a platform like Trustpilot or Review Solicitors.
Ask for the business
Lawyers traditionally are excellent at giving detailed information, but asking for the business will quite possibly fall outside of their skill set. It just feels a little bit too much like selling. One of the first things to do is shift this mindset – it’s not selling, it’s offering great customer service and it’s making your clients life easier. After all what’s the worst that could happen?
Agree follow-up
When we take an enquiry there are couple of housekeeping points that will help the follow-up stage flow more smoothly. Always ask for contact details of the enquirer, agree when you will follow-up with them (if they are not looking to make a decision there and then) and be sure to add their details to your CRM system (or as a prospect in your case management ). After all your marketing has worked this far as they’ve approached you – so be sure to take it to the next level – if you don’t win the work this time you can always keep in touch and help them in the future.
Follow up!
The follow-up is absolutely key – you’ll have agreed when to follow-up on your initial call/enquiry so you need to make sure you do what you promised! Even if you don’t end up securing the business, this will be such a good opportunity to gather some intelligence. If the enquirer has decided to use another firm, who was it – is it an online provider who can do the job more cheaply, is it a firm recommended by their estate agent? Information on pricing, competitors and what’s going on in your local market is key to helping you keep up to date and your offering competitive.
Some fun facts on follow-up
A recent research report from Insight6 highlights some surprising follow-up facts.
The follow-up from telephone enquiries received was just 7% (this is down from 23% in 2019).
Web enquiry follow up stands at 3% and webchat 10% (how crazy is this when we consider just how much firms invest in their websites!)
So imagine what a huge possible opportunity there is in the follow-up! It often gets put to the bottom of the to-do list and time is especially precious in the conveyancing world – make sure you offer your team training where needed so it can become a natural part of the process.
And finally…the 7 hot topics right now in the world of conveyancing with Rob Hailstone:
Conveyancing fees have increased (keep them up)
Sitting nicely with this session talking about how we can make conveyancing work more profitable, the average fees have gone up by 21%. It’s important that there isn’t a “race to the bottom” where fees are concerned as the market starts to slow down. Even though prices have increased (the average price for a leasehold property has increased from £900 to £1090, this still isn’t nearly high enough.
New referral fee proposals
Trading Standards issued guidance in 2019 to ensure that consumers are fully aware of the referral process – i.e. they are aware that the law firm recommended by their estate agent may have paid to be referred the work. New proposals due out later this year, are very unlikely to get rid of referral fees but hopefully it will increase transparency and compliance.
Levelling up
The government’s “Levelling-up” white paper talks about giving buyers more information up front, so potentially a replacement for the ill fated HIPs. HIPs themselves did not necessarily speed up the transaction as they didn’t involve conveyancing professionals at the right time. One way to influence this is to educate buyers and sellers more on the process and the benefits of instructing their conveyancer before their sale or purchase is agreed.
Leasehold changes
Proposed legislation means that leaseholders will now be able to extend their leases for a maximum of 990 years at a peppercorn ground rent, instead of being stung with potentially high ground rents. It does not, however, apply to current leases.
SRA outlines concerns over inadequate advice to leaseholders
Following on from the last point, the SRA is concerned about the advice given to leaseholders and has outlined certain obligations which include interpretation of material clauses which can effect the lease.
Making Commonhold a thing
A consultation is currently underway looking at whether, amongst other issues, commonhold should be reinvigorated as an alternative to leasehold ownership.
Property logbooks
The RBLA believe that residential property logbooks will help transform every aspect of owning and managing property in the UK. Whether they are a good idea and what the full implication and scope of the logbooks remains to be seen.
Dealing with estate agents
It’s also important to stress that your relationships with estate agents will continue to be key. As the market slows down and COVID restrictions disappear, take extra time to get to know them again – including in-person visits where you can!
To finish, here are some of the additional questions raised along with a summary of the answers given by panellists:
- Why does the follow-up not get done?
A: In many instances this is due to lack of time or training. It’s better that the person dealing with the initial enquiry follows it up but it could be dealt with centrally too to make sure it’s not missed. Also, there needs to be some training on how to handle enquires – including how to follow up and get the right sort of information.
- If you have exchanged contracts on a new build property and the property is not due to be built until 2023/2024, will the ground rent change to a Peppercorn even if in the draft Lease attached to the exchanged contract contained Ground Rent of £400 pa?
A: Under section 1(1) of the Leasehold Reform (Ground Rent) Act 2022 a lease granted pursuant to a contract made before the commencement day is not a regulated lease for the purposes of the Act. It therefore appears that the prohibition of ground rent will not apply to those leases and ground rent can remain. The commencement day is yet to be confirmed, but if you have already exchanged you are able to proceed to completion without making any changes to the draft lease.”
- Have firms found a good way to deal with AML /ID checking so that it doesn’t eat into the fee?
A: There are some good AML solutions out in the marketplace. The key is choosing a solution which is easy to use for both conveyancers and customers alike. If you’d like more information on the solutions provided by Legal Bricks, please contact Wayne McGhan.
- Should HIPs return?
A: No they shouldn’t return in the form they were before – conveyancers need to be involved in the process otherwise it won’t speed up the conveyancing process. Conveyancers need to be instructed earlier in the process. Bold Legal are developing a directory of lawyers looking for a step change in the way things are done.
- Any advice for completing a (lender)panel application?
A:It really depends on the lender you are completing the application for and more specific information can be given with this information. As a general rule make sure it is fully completed as the lenders are very particular about missing information.
To view a recording of the webinar, please see: here
[1] Independent research collected by “IFF Research” involving 1501 people who bought or sold in the previous 2 years
[2] Information from a survey of 200 home buyers or sellers (2020)
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