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www.wilkinsonread.co.uk 9 info@wilkinsonread.co.uk

unknown quantity – the aforementioned factors will have a major impact on Private Client teams,

but that in other areas the firm’s niche practices should serve it well.

Although there is little consensus in this area, most respondents seem to agree that there will be

significant pressure on the mid-market firms, but that the ‘best of breed’ will survive with their

independence intact. As McKenna notes, “firms currently do a good job of serving the middle

market. If we look to Australia, consolidation and the impact of external capital has been limited.”

Simon White of Wilkinson Read & Partners, however, believes that the consequences will be far-

reaching, acting as a ‘gastric band’ on the profession (see diagram 1). “Just as deregulation and

technology will lead to new entrants squeezing margins from the bottom, the pressures of

technology and globalisation will allow the larger corporate firms to extend their reach further down

the market. Those most likely to feel the full effects of this are the firms and lawyers currently

operating in the middle, such as provincial and high street firms and sole practitioners, who will see

their client base steadily eroded from both upstream and downstream.”

Barry Wilkinson, also of Wilkinson Read, broadly agrees. He believes that it will only take a handful

of investor-funded outfits to fundamentally alter behaviour across the entire market. “Certain large

firms have already come out and publicly stated their intention to use investor capital for

acquisition, and such operations will cause a knock-on effect lower down the market. Financial

returns and capital growth will become more important than ever, and many firms in the SME

market will be unable to resist the advances of larger competitors. It is certainly true that the best

mid-sized firms will survive – the question is how many will make up this cohort.”

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