COVID19 – Lessons law firms can learn from rivals’ collapses amid coronavirus

City AM has asked legal experts for lessons which they can draw from previous law firm failures. Rita Lowe, co-head of finance at CMS, comments: “Whilst there are myriad factors [in law firm failures], generally it is a combination of fixed overheads… and being unable to adjust those sufficiently quickly and cost effectively.” Pinsent Masons restructuring partner Steven Cottee says: “We don’t tend as a profession to have large cash balances and we have a high level of fixed costs which makes law firms particularly vulnerable to a fall in turnover.” John Lord, a litigation partner at Knights, added: “It’s all about generating accessible cash which you can immediately apply within your business.”