Eversheds has blamed the economic downturn for its decision to close its Norwich office – the reverberations of which are being felt as far away as Chester, Liverpool, Manchester and Preston. North West England may be at the diametrically opposite end of the country to the East Anglian fens, but it is not unaffected by the downturn.
For example, we have recently seen six fee-earners lose their jobs at Cobbetts, and the market is abuzz with talk of further losses elsewhere. But just as important is the fact that, like Eversheds, many of the firms with North West roots are seeking to reposition themselves as national, or indeed international, players. As resources are shifted southwards, what is the significance of Chester, Liverpool, Manchester or Preston in that model?
‘National’ or ‘regional’?
Of the six biggest-earning firms headquartered in the North West – Cobbetts, DWF, Halliwells, Hill Dickinson, Pannone and Weightmans – all bar single-site Pannone stress their ‘national’ or ‘UK’ capabilities.
Patrick Gaul, managing partner at Weightmans, says: “The heritage and history comes from Liverpool in 1824, but we remain a national firm.” Meanwhile, Pam Jones, joint head of property at Hill Dickinson, insists that “Hill Dickinson has been a North West firm in the past, but we want to make ourselves a national firm”.
At each of these firms, the North West is the largest employer of staff and an important client base. It is also an important part of the firms’ identities, reinforced through the power of branding.
Hill Dickinson is a sponsor of Liverpool European Capital of Culture 2008, the current civic project of its hometown, while Pannone senior partner Joy Kingsley says: “Manchester is part of our identity. We’re intrinsically involved in a lot of Manchester events.”
Outside the region, Cobbetts has Birmingham and Leeds offices, DWF a Leeds office, Halliwells a Sheffield office and Hill Dickinson an office in Piraeus, Greece, that handles shipping work. But Manchester or Liverpool dominate in terms of investment and headcount. All have opened in London over the past decade, but these vary from niche offerings (DWF and Hill Dickinson) to a shopfront (Cobbetts) to a largely unsuccessful attempt at a broad church (Halliwells).
Perhaps the ‘national’ epithet is above all an aspirational term, more to do with strategic growth aims than headcount and sources of revenue. “I think it’s a perception thing,” says Kingsley. “If firms are seen as being national they think they’ll be more successful in tenders.”
Those who argue that Hill Dickinson, or its rivals, are indeed national firms would point to the relative mobility of partners and workflow. “We’re all mobile if need be,” says Jones. “Technology allows for that.” But by de-emphasising the home regions, might these firms be shooting themselves in the foot?
Are you local?
Philip Rooney is head of the Liverpool office of international firm DLA Piper, which is built up through a constellation of regional mergers. Despite the ever-shifting centre of gravity, he says that the regions continue to be valued at the firm and that there is a demand among regional clients for regionally-based advice.
According to Rooney, the DLA Piper model is about having a “strong local business on which you build a national and international business”.
“There’s a strong push here and in Manchester towards the region being served by its professional community,” he adds. “Clearly there’s two aspects to it. One is about cost – London’s clearly more expensive. But there’s a sense of city pride also. Business and professionals want to work together to promote their region.”
This can be illustrated by the client roster of DLA Piper’s Liverpool office, which includes Liverpool FC, a number of local authorities, including Liverpool City Council, and work on the Mersey Gateway bridge.
The economic downturn will inevitably provoke a shake-up in the North West legal market. Firms such as Addleshaw Goddard, DLA Piper, Eversheds and Pinsent Masons, which have substantial City presences, will be able to channel work from the capital to the lower cost base in the regions.
In the best possible scenario, downturns in regional markets could be absorbed by shifting personnel and resources elsewhere within office networks. But in the worst case, certain regional offices will be seen as duplicating overheads without providing sufficient return. “You’ve got to be more cash-conscious,” says Weightmans’ Gaul. “You’ve got to be conscious of the debt you’re taking on to fund your expansion plans.”
Those firms with national aspirations should consider whether they might be better off consolidating their bases close to home.