BigHand Report 2025: Write-offs to Increase Say Firms

BigHand has released its 2025 Annual Law Firm Finance Report, offering insights into the evolving financial landscape of the legal industry, from cash recovery strategies to changing client behaviours and an emphasis on business development and commercial awareness among lawyers. Based on a comprehensive survey of 813 senior legal finance professionals, CEOs, and Managing Partners in law firms of 100+ lawyers across the UK and North America, this year's report reveals that the fundamentals of sound financial business practices have been sidelined in the push for growth.

While many firms achieved double-digit growth, challenges such as rising write-offs, discounts, and client demands for financial transparency erode profitability. 

Key findings from the report include:

• 85% of firms report an increase in client demand for financial transparency, up from 76% last year
• 72% of firms experienced increased write-offs last year, with 75% predicting further growth in the year ahead
• 48% of firms note rising client demand for proof of value. Clients demand expertise, responsiveness, resource allocation, budget management and DEI performance.
  

Firms are planning to meet key cash-flow challenges with different strategies. 

• 91% have already implemented or plan to implement lawyer compensation to increase profitability margins
• 64% of firms planning to train lawyers for greater commercial awareness – although only 52% plan to deliver this training in the next 12 months
• 64% of law firms confirm they have more focus on business development and client management
• 44% now use Business Intelligence, and 20% plan to implement it over the next 12 months
  

The findings emphasise the urgent need for firms to adopt robust cash flow processes built on the DICE framework of Data access, Insights from business analytics, Control over financials, and Empowerment of lawyers. This will be key to embedding agility and flexibility while safeguarding profit.

"The report captures pressing challenges facing the legal industry, from poor cash-flow management to the need to build financial acumen among lawyers to drive sustainable growth. It urges law firms to rethink their financial and business strategies in 2025 to ensure strong cash-flow processes, regardless of the economic/business outlook. By using the insights in this report, firms can strengthen client relationships, drive sustainable growth, and position themselves as leaders in a changing market." says Eric Wangler, President Global Legal Market at BigHand. 

"Law firm leaders are focused on embedding a growth mindset into their client management, but this can only be done by training lawyers with support from the right business intelligence tools. Firms that invest in dedicated BI technology are setting themselves up to win more of the right work and remain competitive in the market. It's not just about understanding the data—it's about turning insights into action," comments Briana McCrory, Chief Marketing Officer at BigHand. 

Download BigHand's Annual Law Firm Finance Report for more valuable insights and strategies for boosting profitability.

About BigHand

BigHand offers technology solutions for busy legal professionals that provide data and insights to increase value and profits. They build and invest in technologies that help you to identify improvements across lawyer and support staff resourcing, document production, financial performance and matter pricing.