FINANCIAL SERVICES is the dominant sector in the UK management consulting market, according to a new report.
The sector is growing at more than 7% a year, to £1.8bn, according to a new report by Source Information Services. Its survey was of executives that buy consulting services, and focuses on consulting firms with 50 or more consultants. Data was also collated from 120 firms, and excludes IT implementation and outsourcing.
The UK market for these firms is has grown 4.8% in the last year, and is expected to grow by between 5% and 10% in 2014.
Financial services has grown while being dominated by work connected with regulation and remediation.
The Big Four firms grew at 8% in the field during 2013 - twice the rate of their competitors, representing nearly £2bn in revenues. This could be attributed to them buying market share, but also their strength in financial services.
Retail saw 8.6% growth, to £241m, with a desire for a multi-channel offering among clients the key to advisory's growing prominence in the sector. Healthcare grew 6% to £218m.
Edward Haigh, a director of Source and an author of the report, said: "The prospects for growth look good in the all-important financial services sector and when this firing the UK consulting market takes some stopping.
Retail the next star
"But the star of the show will probably be the retail sector, which is grappling with the challenges it faces in a multi-channel environment and calling on consultants to help it as it does. Retailers drive a hard bargain and will often expect consultants to commit to delivering specified outcomes, but we still expect double-digit growth in the sector's consulting market."
Looking ahead, cost-cutting is still expected to play a big part in the need for consulting advice, although an increase in M&A is also predicted. A third of clients expect to increase consulting spend in 2014.
Michael Robinson, UK head of management consulting, KPMG, said that using digital and technology to transform business will also be a big part of the consulting market going forward.
"In particular, mobile applications, the next generation business process management tools, data and analytics and cloud based solutions will reduce dependency on the provision of services from the in-house IT function," said Robinson.
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