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Legal finance for the consumer goods & services sector

June 6, 2024
Liz Bigham
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The consumer goods and services industry has faced significant challenges in recent years due to inflation and a decline in consumer spending, all putting additional pressure on already thin profit margins. Finance and legal leaders in the sector are mainly focused on managing and minimizing legal costs while conserving capital. As a result, the industry is increasingly leveraging legal finance solutions. 


Insights from recent research into consumer goods & services dispute dynamics  

Burford recently conducted research into economic impacts on different industries, their legal departments and their litigation portfolios. For senior in-house lawyers and finance leaders at companies in the consumer goods and services sector, the key takeaways were:   

  • 93% of finance and legal leaders at consumer companies agree that litigation is expensive and even large companies can benefit from reducing its impact on the P&L.  

  • 70% of finance and legal leaders at consumer companies say they expect alternative fee arrangements to increase over the coming years.

  • Consumer companies are increasingly prioritizing minimizing legal costs, with 88% of respondents agreeing with this sentiment.

  • Finance and legal leaders at consumer companies are more than twice as likely to view capital conservation

How legal finance is used in the consumer goods & services sector  

Legal finance enables businesses in the consumer goods and services sector to maximize their recoveries in commercial disputes to ensure they can fully leverage their legal assets, as well as conserve capital.

There are numerous ways companies can leverage legal finance to unlock latent value from their litigation and arbitration assets—without impacting control of their disputes

  • Manage cash flow: Burford can accelerate expected entitlements from pending claims and awards, providing companies with the flexibility to time cash flows according to their desired schedules, enhancing liquidity and working capital.   

  • Fund claims and recoveries: Burford takes on the financial burden of paying lawyers to pursue meritorious high-value claims, allowing businesses to pursue meritorious cases without incurring upfront costs. 

  • Eliminate downside risk: Legal finance provided by Burford is non-recourse, meaning that the investment and return are contingent on a successful outcome. This allows businesses to lock in guaranteed minimum returns and shift legal risk off their books

  • Identify opportunities: Leveraging proprietary data and industry-leading insights, Burford can assist legal teams in setting priorities for their commercial litigation and arbitration portfolios. This helps businesses identify the most valuable claims and allocate resources effectively.  

  • Manage exposure: Burford can provide a hedge for litigation risk in the company’s portfolio. This allows businesses to mitigate the potential financial impact of litigation and protect their interests. 

  • Enforce judgments: Through funded enforcement and asset recovery, Burford can help businesses transform unenforced judgments and non-performing loans into cash. 

Case study

 A Fortune 500 company had a large meritorious opt-out antitrust claim against producers for anticompetitive collusion while simultaneously facing pressure to cut costs following a brief decline in profits. To address this challenge, the company was able to monetize a portion of the expected proceeds from its claim, receiving a $29 million advance from Burford. This allowed the company to pursue the litigation without ceding control and without incurring additional risk. The immediate cash infusion provided by Burford helped offset revenue generation pressures and provided liquidity for strategic business purposes.