Dropping demand forces consultants to slash fees by 30pc
CONSULTANTS are being forced to cut their fees by up to 30pc as demand drops and a pause in on-site working during the pandemic allows more firms to compete for contracts regardless of their location.
The UK consulting sector could shrink by 16pc this year as businesses rush to cut variable costs in an effort to survive the economic crisis, new research shows.
The downturn is particularly acute in hard hit sectors such as retail where consulting revenue is expected to fall 29pc this year, according to Source Global Research, which analyses the professional services industry.
The rise in spending on consultants to help companies upgrade their technology is also set to slow, with 26pc of those surveyed globally saying they expect to increase their use of consultants for “digital transformation” projects compared to 55pc at the end of 2019.
Companies that do press ahead with upgrades could focus on more straightforward, essential projects, limiting the fees that consultants can charge.