Front end activity tends to be an upward driver of pricing forces in the construction legal market and the downturn in such activity in the WA market has seen renewed price sensitivity.
Panel revisions, project cancellations and a general lag in market activity have placed only downward pressure on hourly rates. While WA’s construction lawyers benefited from the resources boom and generally found comfort above $600-$700 per hour there’s a renewed focus that sees a 10%-30% reduction in that pricing level.
Stronger constructi0n practices and practitioners continue to push hourly rates approaching and in excess of $700 per hour however these hourly rates aren’t necessarily a green light for high profitability as they’re also often coupled with comparatively low leverage.
Within the smaller and mid-tier practices prices varied considerably however figures of between $500-$600 per hour on matters were generally be considered reasonable.
Forget innovation. When it comes to cost cutting there’s typically no great science involved. The simple dynamic is to simply focus on fixing a price and making sure that price is as low as possible. In this regard over three quarters of firms looked beyond the standard hourly rate and over 90% of those firms used fixed price and/or stage based costing as a means of keeping clients happy.
In reality the fixed price was more of a cap on fees than anything else, particularly in contentious matters where, if the matter is resolved before the estimated fee amount is reached then the client is simply billed a lesser amount.