After experiencing low growth of 3.6 per cent in 2016, the Benelux consulting market saw stronger growth of 5.4 per cent in 2017 to reach a value of €2.1million.
Luxembourg—the smallest market—fared the best, thanks to a large financial services sector full of clients looking to respond to disruption caused by fintechs and high levels of regulation. While the growth rate was slower in the Netherlands and Belgium, consultants saw increased opportunities in these markets as well.
These findings are published today (16th April 2018) in a new report from Source Global Research, the leading research and strategy firm for the global management consulting industry. The Source report also reveals that digitisation remains a big theme in the Benelux market, with more clients investing in digital solutions and driving a growing demand for both customer-facing initiatives and back-office improvements.
Consulting market growth was also experienced across every sector in 2017. Consulting revenues grew fastest in the financial services, retail, and healthcare sectors, driven by a combination of regulatory and digitisation work. The energy & resources and technology, media & telecoms sectors were once again the worst performers with low growth for consultants as clients prioritised cost reduction.
From a service line perspective, risk & regulatory work grew fastest, driven by demand around regulatory compliance and increased investment in cybersecurity. Technology remained the largest service line and experienced the second-fastest growth as digitisation made an impact.
B.J. Richards, Senior Editor from Source Global Research said:
“Despite growth picking up, the long-term viability of the Benelux region as a standalone consulting market continues to be an open question. While growth remained varied across the three countries, there was a good volume of work overall as the growing appeal of headquartering in the Netherlands compensated for the decline in the number of Belgian-owned companies and the presence of the EU continued to generate opportunities.
While an oversupply of consulting remained a problem, changing pricing models helped to alleviate price pressure for some firms.”
Type A firms (a group dominated by the Big Four) were, once again, the largest and fastest-growing (up 7.8 per cent to €790million), bolstered by very strong demand for their regulatory expertise. Technology and strategy firms also experienced healthy levels of growth in 2017.
The demand for regulatory expertise was highlighted by Jean-Francois Kroonen, Advisory Leader of Luxembourg, at PwC, who said:
“We see the highest growth in financial services. Banks are undergoing a lot of remediation planning, and they're working hard to make sure they're compliant with everything the EU throws at them. Among other things, they are having third parties review their client files and procedures, and that alone is enough to drive solid growth.”
While concerns around wider global economic issues remain, consultants are cautiously optimistic about their prospects in 2018: with transformation projects expected to continue; sustained demand around regulations; and expectations of further strong economic growth.
Sourced from Consultant News