As part of the Teal Compliance Office Training, we ran a webinar session running through all the requirements in relation to Price Transparency and the impact it has upon firms.
The first thing I would say is that the new rules creates a market of opportunity on which you can take stock and look at your pricing structure, how you price and the services you offer to your clients. The aim of the new rules and the research behind them is to provide good quality information to potential and existing consumers to enable them to make the best decision for the type of service they require and within their budgets.
A lot of firms are focusing on the perceived negative impact, that it is “big brother” and other competitors will undercut their fees and poach clients. This mindset can be damaging in the respect of missing opportunities that will help you retain your existing client base and building new relationships. The research which was commissioned in 2016 by the Competition & Market’s Authority (“CMA”) had concluded that there was insufficient information available to consumers and small business, not just in relation to price, but equally as important to quality of service and the services offered. This aspect was particularly evidence in relation to the conveyancing market where consumers said that they would not necessarily go for the cheaper option and were more drawn towards the quality of service. The majority of consumers looking for legal services said that if the information was accessible online that would help them in making a decision as to which firm they approached. They also stated that if the firms had a “digital badge” which is displayed on the website, that would give a greater confidence to consumers and it could be the deciding factor on whether a consumer uses that firm.
To recap on what is required under the new rules:
I have undertaken some of my own research by looking at firm’s websites. There are some firms who have absolutely got it spot on, however I have to say I am quite surprised by the number of firms who are not publishing the information at all or some who have looked at the new rules and attempted to be compliant. The CLC have already started to undertake reviews of firms regulated by them and the SRA will not be too far behind. Whether firms want to accept the rules or not, you still have to comply. The SRA and CLC digital badges must also be published on your website.
If you are not sure how to tackle this, or you just need a sense check then we are here to help. I have been working with a lot of firms in this area, and we have found that as part of the review of the website to become compliant, we have run some pricing workshops for firms to re-enforce all the services you offer and sometimes do not charge for.
It is so important to prepare the estimate and client care letter with the information you have available to price and set the scope of the works you are undertaking. Where I see firms falling down on, is where a profile of that matter/transaction changes and they stick to the original estimate in fear of losing the client or saying, “we can’t charge for that”. You are providing a service that is chargeable, as long as you continue to communicate with your client and explain why those fees or disbursements for that matter are being incurred then you are justified in making that charge. What the new rules are designed to do are to flush out those firms who add on the “hidden” costs at the end of a transaction, leaving the client confused, and uncertain as to how they are going to pay for those additional fees.
A lot of firms are using online calculators, and these are a great way of providing an estimate where the onus is on the client to provide the correct information. Again, if this information changes or then you reserve the right to change your fee accordingly. There was evidence to suggest that particularly in conveyancing the use of online calculators is assisting in winning business. Furthermore, there are some firms who have “Chatbots” or have the AI that when an estimate is generated and accepted by the potential client, that the client care letter, terms of business are sent to that client and over the course of a weekend those businesses won clients. These are fantastic examples of what you can do to be compliant under the new rules and maximise business potential. What’s not to like?
There are some things to consider if you are looking at introducing an online calculator:
Following on from these questions you ask at the outset and how you scope your client care letter, have you considered how to maximise potential through online reviews. This is an area where the impact those reviews may have are incredibly powerful. Focus on them forming the best type of advertising you can have and if you experience a negative review, deal with the review head on, off line and remember that everyone can have a bad review. The thing is if you get a bad review, don’t let it determine what your firm is or undermine the other positive reviews you receive.
There are different ways of obtaining reviews and providers that can give you the plug ins to your website, creating an end user experience where consumers can leave feedback. Remember that all feedback is good. It’s lovely to receive those reviews where you receive a 5-star rating, equally use the less positive reviews as a way to improve your services.
You can quite often ward off a potential complaint by dealing with any negative feedback and if it does proceed to a formal complaint, ensure that you have all your complaints information available on the website, within your client care letter and that your staff are fully trained on what to do and who to signpost the complaint to. Revisit your internal complaints procedure, update it if necessary, along with all the associated policies and templates.
If I was to give you any tips, it would be the following:
- Use Price Transparency as an opportunity to revisit your current fee structure and prices
- Ensure that your website is compliant with the relevant information
- Obtain your digital badge
- Communicate all the changes to your staff, so they are aligned with the new rules
- Update and align your policies and marketing brochures
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