What it takes for boutique firms to succeed

by Peter Godfrey14 May 2014
Focus and price can be the deciding factor when it comes to deciding on firms both big and small, according to Vodafone's Australian general counsel, Trent Czinner – and boutiques are at a distinct advantage in both respects.

Indeed, if firms genuinely want to operate as boutique or specialist firms, instead of using the term to disguise the fact they are simply small, then they must stay focussed on where they can provide the most value to their clients.

“When we did our last tender for Vodafone’s legal services, it came down to us wanting to have a range of firms, so we decided on four large firms plus one boutique,” he says.

Czinner explains that the boutique firm was chosen because its partners were ‘telco experts’ and because it had done work for Vodafone in the past.

However, price was also a key factor. Czinner says the boutique charged approximately 20% less than a large firm.

The boutique firm’s willingness to take on less important work was also crucial. “They were willing to take on more run-of-the-mill work,” Czinner says. “Larger firms were less willing to do work that wasn’t their bread and butter because they wanted higher value work.”

Specialist corporate legal advisory and transactional firm Harmos Horton Lusk (HHL) founding partner Andrew Harmos says his firm’s success relies heavily on the fact that it’s not structured around the pyramid model that relies on bulk and hours for profitability.

“The directors (partners) of HHL are across all current client mandates,” says Harmos. “So clients get what they see - direct director involvement. Our model doesn’t rely on throwing lots of people at projects and our team is experienced, so we tend to generate results more quickly and efficiently, including more cost-effectively, than our competitors. That said, we have the resources to manage significant transactional projects.”

Harmos says attention to brand and brand/client association is also key.

“We don’t take every mandate that comes through the door,” he says. “We don’t advertise. [We] prefer to be selected because of known qualities and confidence in outcomes, rather than off an advertisement or a pitch where selection criteria is often ambiguous.”

Boutique employment and education law firm HarrisonStone founding partner, Gretchen Stone, says relationship-building is also key when it comes to running a successful boutique practice.

“Developing strong relationships with our clients, and working alongside them to provide practical and pragmatic solutions to their legal issues [is important],” says Stone. “Specialising gives an advantage in that it enables the lawyer to have extensive knowledge and experience in their area.”