After growing from a ‘sole-trader’ standing start to £2m group turnover and 50 staff in four years, Newtons plans to bring in non-lawyers to help devise its business strategy.
ABS was introduced as part of the Legal Services Act, which allows non-lawyers to take equity stakes in law firms for the first time, creating major opportunities for expansion.
The Legal Services Act, which came into force in October 2011 has been a catalyst for major changes in the sector.
It also means that non-legal companies, such as supermarkets and banks, can enter the sector.
Managing director Chris Newton, who founded the firm with his wife and fellow director, Sarah, in 2009, said yesterday: “Gaining an ABS license, is all about running our group as an efficient commercial enterprise.
“We recognise that the best business people and managers are not necessarily qualified solicitors.
“Now we have ABS in place, we plan to recruit a professional finance director and, in time, an experienced managing director. Heather Johnson will also join the board of directors after helping build Newtons seven-solicitor strong property team.”
Over the last 20 years, Ms Johnson has worked for a number of firms in the Harrogate area. Mr Newton added: “ABS removes the barriers which could hinder our growth, and enables us to compete with larger organisations, which we see entering the legal market.
“An expansion into London, and further growth into the North East, is on our business agenda, together with the appointment of eight new senior solicitors.”
Mr Newton said the firm was looking into the possibility of opening an office in the heart of London, potentially at a site between the West End and Chancery Lane. Mr Newton has expanded the legal group at a time when many law firms have contracted, merged or closed.
He added: “I can see our way to a £3m turnover, but I would like to achieve £5m turnover, with 20 per cent profitability, in the medium term and believe that ABS will be crucial in enabling us to achieve this.”
Newtons, which started as a ‘virtual’ law firm run from Mr Newton’s home, opened its first office in Knaresborough in 2010 after achieving a £300,000 first year turnover.
The firm’s second year trading saw it achieve £578,000 turnover. It also acquired an office in Ripon and one in Harrogate.
This year, the firm opened an office in York and Mr Newton and his wife acquired Hodgsons and Mortimer Solicitors, which has offices in Darlington and Richmond.
Mr Newton said the firm had prospered due to its structure.
According to Mr Newton, the firm isn’t burdened with the traditional ‘management’ committee, which means it can make decisions, and respond to opportunities, very quickly.
Newtons, which announced 75 per cent growth in 2012, expects to announce a number of senior appointments soon.