ALSP (Alternative Legal Service Providers) continues to prove itself as a force to be reckoned with across both legal and business sectors. Technavio, a leading market research company, recently reported that legal outsourcing is projected to grow more than 30% by 2024.
Between 2021 and 2025, their growth is anticipated to exceed more than 30%, increasing by $18.07 billion in the same period (Southern California Record, via TechNavio).
Recent shifts in the economy, as affected by the predicted upcoming recession, have created a financial environment highly conducive to the flourishment of ALSP. When seeking to reduce costs, outsourcing legal counsel is a vital method to streamline operations and mitigate spending.
The Legal Process Outsourcing (LPO) Services Market 2021-2025 report has calculated that the most revenue will come from the markets of the United States, United Kingdom, Japan, Germany, and India.
Three years ago, the Asia Pacific region held the biggest share of ALSP business, with the United States following closely behind. South America held a 20.15% share of the work, and Europe came after with a slighter 7.09%.
The Legal Process Outsourcing Services Market report implemented Porter’s five force analysis of this competitive market and discovered that while fragmentation is expected to continue, reallocation of worth is possible given the rapidly evolving nature of the sector as a result of current economic trends.
In a nutshell, Porter’s Five Force Analysis is a system utilized to evaluate a company’s competitive environment. The five points include the number and power of a company’s competitive rivals, potential new market entrants, suppliers, customers, and substitute products. Each of these qualities influence a company’s projected profitability and success.
According to analysis released by TechNavio, as of three years ago (2019) the outsourcing market was valued at $334.5¬ – by the end of 2022, its predicted worth is $377 million. This steady and substantial progress is a clear indication of the industry’s positive direction.
It seems apparent that ALSP is a valuable option in legal operations. The comparatively lesser costs (in respect to firms or out-of-house counsels) is enough of a reason alone to switch to legal outsourcing, but when considering the reported efficiency and quality of the industry, it’s hard to justify anything else.