Professional practices benchmarking 2025 report

In the fast-moving economy that is the legal sector, accurate and relevant data for your decision-making is key. But many firms are still relying on outdated benchmarks, gut instinct, or fragmented insights. That makes it harder to stay competitive, control costs, and plan with confidence.

Rising operational pressures, shifting client expectations, and increasing competition mean there’s little room for guesswork. You need a clear view of where you stand and what good really looks like. That’s where our professional practices benchmarking report comes in. It cuts through the noise, giving you practical, reliable insights to compare performance, spot opportunities, and make smarter decisions with confidence.

This report brings together data from key law firms within the legal sector of all structures and sizes in order to identify the trends that are driving profitability within the legal sector and within your firm.

The “current” data within this report is our 24/25 data and refers to year ends between 15th April 2024 and 15th April 2025, so it includes this year’s March 2025 year-end trends.

Throughout the report, we draw on market insight, law firm data and decades of experience advising law firms on how to navigate the changing economic cycles and market conditions, to extract both good and bad behaviours that law firms display, in order to share them with you.

Our report identifies key financial drivers of performance across the profit & loss account and balance sheet, that profitable law firms are using to manage and measure their firm’s performance.

KEY TRENDS

Despite operating in an economic and regulatory environment of constant change, law firms continued to demonstrate resilience to beat inflation in terms of fee growth (10.56%) and profit growth (15.65%) in 24/25. Both measurements indicate greater growth than in the previous 4 years.

The increased profit growth shown by law firms is indicative of stronger cost control and more efficient use of resources than in previous years. Although client account interest receipts continue to provide welcome additional investment income for law firms, they are no longer a driver in the rate of profit growth among law firms.

Our data shows an increase in the number of firms where net interest is now a contributor to profit rather than a cost (50/60 vs 39/60). This is a result of reduced borrowing across the sector, combined with firms holding larger client account balances in line with their growth in activity.

Beyond the profit & loss account the data shows that the most profitable law firms have consistently converted that profit into growth in equity over the past 5 years to reinvest into the future growth of the firm. Coupled with good lockup management, this is driving the reduction in borrowing across the sector.

READ THE FULL REPORT

More detail and deeper insight can be found within the report, along with questions that you as a law firm owner should be asking yourselves, your partners and your management board in order to drive out additional profit next year. Read the full report here: Professional Practices Benchmarking Report 2025.

How can AAB help?

Law firms are under pressure from every angle. Margins are tightening. Costs are rising. And long-term planning feels harder than ever. It’s not just about keeping up. It’s about staying ahead. That’s where we comes in. We work closely with legal practices across the UK, supporting them through change, growth, and everything in between. Our role goes beyond the numbers. We help you make sense of where you are now, and where you want to go next.

Whether it’s improving profitability, strengthening cash flow, or planning for succession, we bring clarity when it matters most. We understand the challenges you’re facing because we see them every day. And we know what works.

If you would like your own bespoke version of the report, where we will show you exactly where you rank within the data and help you identify the areas for improvement that will have the most impact on profitability, get in touch with our team.

With the right insight and guidance, you can move forward with confidence. And achieve the growth your firm is aiming for. We hope you find this report insightful and encouraging, and if you would like to discuss any aspect of your performance or the report, please get in touch with Joel Topham or your usual contacts at AAB.