24 Nov 2021
Consulting sector review | Investec insight
Despite COVID-19, growth has been stable across the consulting sector with M&A activity continuing at pace globally.
The UK consulting sector grew 4.5% in 2020 despite COVID-19 and the fallout from Brexit. Small and medium sized firms experienced growth rates of over 30%, as they quickly pivoted services to leverage market opportunity.
We have seen a high volume of M&A activity as consultancies adapt to the impact of the pandemic and enhance their service offering to support clients in digitisation, cost management and transformation efforts. The market has also seen major investment in areas such as engineering, environmental and sustainability as consultancies develop capability.
A continued focus on digitisation, talent development and the need for global capability will drive further growth in the consulting sector.
The focus on developing digital capability is just one part of the enhanced service offering that clients increasingly expect consulting organisations to have. Adoption of a multi-sourced approach to provide specialist capability illustrates where organisations have gaps against client demand, a potential future driver for M&A.
More than ever, consultancies also recognise the need to recruit, retain and develop a diverse talent pool with the right skill sets to deliver on client needs. As a result we expect to see a continued convergence between training, talent development and consulting across the market.
“”– Jonathan Arrowsmith, Head of European Investment Banking InvestecWe continue to see growing demand for assets across the consulting sector, with the impact of COVID-19 expediting the move to hybrid, tech-enabled delivery models and the demand for transformational change across global organisations.
If you have questions and would like to know more – please get in touch: ervin.schellenberg@investec.com, mirko.nikkels@investec.com