Jenifer Swallow, Director of LawtechUK, discusses the opportunity for lawtech to address the unmet legal needs of SMEs and the significant opportunity for the sector. (Sponsored content.)
UK SMEs could make cost savings of up to £8.6bn each year by using lawtech products and services, according to research carried out on behalf of LawtechUK for our report ‘Shaping the future of law'. SMEs play a vital role in the UK economy, representing 99.9% of UK businesses and ~60% of jobs and private sector turnover. Despite their economic importance, legal services do not serve them as well as they should.
LawtechUK together with the Legal Services Board commissioned research into how lawtech could bridge the gap between SMEs and legal services. In the qualitative study, a number of SMEs from different sectors (some of whom had previously used lawtech) were asked about their business’s legal problems and how they access legal advice and support.
The research revealed:
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Many SMEs do not know when or whether to involve lawyers – and some do not recognise when they have a legal problem.
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Across the board, SMEs are frustrated that getting legal issues resolved can be costly and time-consuming.
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SMEs are looking for solutions that are good value for money, won’t take up too much of their time, and that provide reassurance.
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Most SMEs see a role for lawtech solutions, particularly for their most common legal needs, such as finding a legal service provider and preparing legal documents.
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Many SMEs see lawtech solutions as complementing existing services, and/or bridging a gap between traditional legal providers and ‘DIY law’, and noted the importance of access to in-person support alongside digital tools.
According to the research, SMEs’ legal needs fell broadly into two categories: reactive, for example, debt recovery, dispute resolutions, or HR issues, and proactive, for example, routine legal document drafting.
The debate is often framed around technology replacing existing services, but our research shows that lawtech offers new opportunities for legal service providers to meet the unmet needs of SMEs and make many people’s lives easier in the process, e.g. by helping SMEs:
• recognise and understand their legal needs
• understand what lawtech is and how it can help • see business benefits of ongoing legal support, shifting the view of legal services as only a last resort.
SMEs point to a clear role for digitally enabled legal services, giving them access to support that is timely, affordable, convenient, and reassuring - and, importantly, that increases their resilience over time. That in turn points to an opportunity for legal businesses to partner with technology providers and vice versa, to build and scale solutions and services the SME community needs: those using traditional legal services today who want a more convenient and affordable experience, and those not accessing legal services at all but who would go further faster with lawtech enabled legal support. The latter is an untapped UK-wide market representing ~£8.9bn per year. The opportunities to innovate are significant and some practical steps towards this can be seen in this infographic.
It’s clear from our work with SMEs that there is much more that can be done to meet their unmet legal needs. They are willing to engage and that there is a significant prize for legal innovators who meet their needs.
Jenifer Swallow, LawtechUK Director, Tech Nation
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