Should businesses pay for services that they don’t need or want? For most people, the obvious answer to this question is “no.” Just as people have become resentful of the cable industry for forcing them to pay for channels they don’t want in order to get those they do, businesses have become increasingly weary of products and services that include (and charge for) unwanted bells and whistles.

However, there is one industry that has managed to hoodwink even the most budget-conscious CEOs and CFOs into paying for unnecessary services, and that is the legal industry. Legal services are notoriously expensive, and many businesses are used to receiving large bills from law firms. More often than not, CEOs and CFOs simply resign themselves to paying them because they believe there are no other options or because they don’t have time to analyze the invoice and go back and forth with their attorneys about how each hour billed was spent. Unfortunately, what they fail to realize is that those bills include the cost of not only your particular attorney’s time, but also of a myriad of other services that they’ll never need.

Bundled Legal Services

Much like cable, legal services at law firms come in a package, and you get charged for the entire package regardless of how much of it you actually use. Hiring a law firm gives you access to all the attorneys at that firm, from the newest associate to the most experienced partner. Even though your project might only necessitate the services of one associate, your bill still includes the costs of hiring and retaining all of the firm’s other 300+ attorneys, including subject matter experts who deal with extremely niche legal areas that are completely irrelevant to the basic business law projects of most customers.

That can get expensive quickly. Consider that associates at brand name law firms can make as much as $180,000 per year, and that’s even before signing bonuses are accounted for. Additionally, law firms have lots of overhead costs, such as office space, support staff, client dinners and recruitment perks. Unfortunately, customers are left to foot the sizable bill. 

Much like cable, legal services at law firms come in a package.

Tweet This

How UpCounsel Can Help

Although it might seem like businesses have no option but to subscribe to the package deals offered by law firms, the truth is that the rise of the on-demand, B2B economy means that customers actually have more choice than ever before. They simply have to seek it out.

The best midsize companies use different forms of legal services for different types of legal tasks. They unbundle their legal services by fitting the right legal resource to the right project.

Midsize companies need robust legal protection but they can’t afford to waste money or human capital. They have more financial resources than startups but also face more complex legal issues and regulations. COOs and CFOs who are able to most effectively walk this balance beam are the ones who think outside the traditional century-old law firm model.

Everyone used to hail or call a taxi or hire a limo as a knee jerk reaction to a transportation need, but now we use new options like Uber, Lyft and Chariot, among others. We consider the transportation need, the forms of transportation available, and how much we’re willing to spend to get from point A to point B. Without thinking about it, we’re using different transportation platforms for different transportation needs, and we’re able to evaluate our options based on newly available criteria like arrival times, driver ratings and transparent costs. 

The rise of the on-demand, B2B economy means that customers have more choice than ever before.

Tweet This

Those same consumer tools are now available to businesses, and the most forward-thinking COOs and CFOs are recognizing this shift and moving a growing body of work to non-traditional providers of legal services.

For now, big law firms continue to be the best resource for high-stakes litigation needs like FCPA allegations, but as legal technology offers innovative alternatives, COOs and CFOs with the most cost-effective legal strategy are unbundling their legal services.

Other UpCounsel Benefits

Responsiveness

A Harvard Business Review survey of 88 general counsel at big companies like eBay, Nestle, Progressive, Shell and Google found that more than half said that attorneys at big law firms are far less responsive than freelance attorneys and attorneys at small firms. That’s because there are often many people involved in a single project at a big law firm, and each of those people has to review changes made at every step of the way and sign off on them.

This lack of responsiveness is annoying at best, and disastrous at worst. If the legal process slows down the sales cycle, as it is wont to do, it can result in sales deals falling through, which is every salesperson’s nightmare. 

Businesses that engage freelance attorneys pay for exactly the services they need and nothing more.

Tweet This

Cost-Effectiveness

According to the Harvard Business Review, working with a freelance attorney instead of relying on a law firm “results in an overall cost premium in the 60+% range.” Why? Freelance attorneys like those on UpCounsel attorneys generally work at small law firms or out of their own home offices, so they have few to no overhead costs to pass on to their customers. Therefore, they can afford to charge rates that are far lower than those at big law firms or even most small law firms.

Work Isn’t Sent Down the Pipeline to Associates

At large law firms, appearances can be deceiving. You might think a senior partner is in charge of your project, but in reality, he or she barely does any of the work involved. Instead, the senior partner delegates the work to a much less experienced associate, increasing the likelihood of errors and oversights. The customer is never informed that there is no senior partner intimately involved in the project, and so continues to pay partner rates for associate work.

At UpCounsel, however, attorneys don’t have cadres of associates to rely on. Therefore, UpCounsel users know that the attorney they hire will be the person doing the necessary work.

Using UpCounsel in Conjunction with a Law Firm

Despite all these benefits inherent in using a marketplace like UpCounsel for legal work, there are some situations in which working with a big law firm is necessary. Particularly large and laborious projects might necessitate the veritable army of attorneys that only a big law firm can provide. 

There are many everyday legal needs that simply don’t necessitate the services of a big law firm.

Tweet This

Nevertheless, there are many everyday legal needs that simply don’t necessitate the services of a big law firm. In these cases, legal marketplaces are the perfect resource. They offer high quality subject-matter experts at a fraction of what those same attorneys would cost at a law firm. Additionally, since they aren’t part of a larger organization, they don’t come as part of a package deal. Businesses that engage freelance attorneys pay for exactly the services they need, nothing more, nothing less.

In this way, business are at liberty to unbundle their legal services just as they have unbundled their cable. Just as many people now consume films, television shows and more on the internet with services like Hulu and Netflix because of their ability to provide customized content at low prices, the legal industry is slowly shifting towards a similar model. Such is the stunning power of the B2B economy to provide consumers with more options in almost every facet of their lives, from transportation to entertainment and even legal services.

About the author

Aviva Schmitz

Aviva Schmitz

Aviva is a content marketing intern at UpCounsel and student at Tufts University in Medford, Massachusetts. She has served as an editor and contributing writer for publications such as The Culture Trip, the Tufts Daily, and satirical magazine The Zamboni.

View all posts

Post a Job on
UpCounsel and get
high quality legal work done

Post a Job on UpCounsel
Shares