David Wilson Homes threatens to cut panel as part of efficiency drive

Leicester-based David Wilson Homes, the homebuilding unit of Wilson Bowden, is considering plans to cut the number of firms it instructs following a benchmarking exercise.

David Wilson Homes outsources around 70 per cent of site acquisition work and all plot sales. Most of that work has historically gone to 16 firms across the housebuilder's 13 regional divisions, ranging from large regional firms to sole practitioners. Additional firms do some plot conveyancing and may also be streamlined later.

David Wilson Homes has an annual legal spend of around £2.5m. It builds 3,800 units per year, specialising in higher-margin four, five and six-bedroom homes on greenfield sites across England.

Peter Carr, the unit's head of legal, says that the only sensible way to improve legal outsourcing is to use fewer firms. He says: "We are reviewing the efficacy of having so many firms.

"We have done a benchmarking exercise with a view to improving efficiency and relationships in terms of the legal service providers that we use. A couple are dropping by the wayside already."

Firms used by David Wilson include Campbell Hooper in London, Clarke Willmott & Clarke in Bristol, Freethcartwright in Nottingham, Hammond Suddards Edge in Birmingham and Shoosmiths in Northampton. Theodore Goddard also carries out planning work.

Carr says: "What makes it difficult is that we've got very good lawyers acting for us."

Cutting management time and costs by giving firms a greater volume of work are priorities for Carr. Another concern is that sole practitioners present greater insurance risks than larger firms with better coverage.

He says: "From a selfish point of view, if you can put those individuals in bigger firms so that they would have the resources we need to support them, that would be great."

The spread of work also means that David Wilson is not always given preferred client status.

Carr says: "It would be nice to have four divisions of lawyers – that way they all get a bigger slice of the cake and they would be happy with the result. They are all very loyal, but would like to make more money out of our work.

"It's a two-way thing. They are only going to deliver a service if they get the benefit of sufficient work to make it worthwhile."

Carr says that the rationalisation process could take two years. In the meantime, he is bringing partners from all of the firms together for the first time in an effort to standardise and coordinate activities.