A report released by FEACO. The European Federation of Management Consultancies Associations, has found that the size of the European Management Consulting Market continues to show signs of a recovery, revenues increasing by 3.7 per cent in 2004 – nearly reaching the €50 billion milestone (€48.5billion in 2004).

The FEACO Report also found that in 2004 revenue from IT & Systems Integration work (the biggest service line for consultants since 2001 across Europe) declined by 6.1 per cent, and was dethroned as the largest service line in Europe by Operational Management (OM) work, which increased by 3.7 per cent to €13.2billion (27.3 per cent market share). With a growth rate of 11.4 per cent, outsourcing grew fastest of all five key service lines and now represents 19% of the market.

UK – still the largest market

With a 29.3 per cent share of the market, the UK continues to be the largest consulting market in Europe (growing by 7.2 per cent in 2004), and with the 2012 Olympics an important driver for the UK market in the future, this is expected to continue. Double digit growth rates, which were observed regularly across the European consulting market before 2002, have become the exception in 2004, with only Eastern European countries, such as Romania (up 35 per cent to €1billion) showing these growth rates.

Signs of a German recovery

Germany, the second largest market for consulting in Europe, has shown signs of recovery after two poor years (in 2002 and 2003 turnover fell by 4.4 per cent and 0.5 per cent respectively). A rate of 3 per cent is predicted for 2005, with ongoing internationalisation, as a result of the opening up of new markets as well as a dislocation of production facilities.

Market Declines in Portugal, Italy and Greece

Portugal (minus 13.6 per cent) and Italy (minus 3.0 per cent) both experienced continued decline, whilst Greece, that showed two years of double-digit growth (2002 – 19.5 per cent and 2003 – 15 per cent) showed a marked decline in 2004, down 6 per cent. The key driver in the Greece market was still work from the Olympics, but major constraints, including elections delaying the awarding of major consulting contracts affected this markets performance.

Banking sector drives private sector growth…

The Banking sector across Europe has again become a key driver for the management consulting industry, increasing by 12 per cent to €5.6billion in 2004 as regulatory topics such as Basel II provide work for consultants. The Non-Profit & Government sector, since last year the largest client sector, demonstrated a remarkable increase (plus 21 % on € 8.1 billion) and now accounts for 16.8% of the market.

Rémi Redley, outgoing Chairman of the European Federation of Management Consultancies Associations (FEACO) commented: “This report confirms the expected recuperation of the European consulting market and we are expecting a continuation of at least the level of growth experienced in 2004 in the year ahead – taking us over the €50 billion milestone. The need for companies to be competitive appears to be a major driver of demand for consultancy services in all Eastern and Western European countries, with Operational Management becoming the largest service line for the first time.”

The FEACO Survey of the European Management Consultancy Market in 2004 is now available. (Price: 75 €) To order, please send a message containing you complete contact and invoicing details to: feaco@feaco.org


FEACO – The European Federation of Management Consultancies Associations*

FEACO the European Federation of Management Consultancies Association, established in 1960, is the representative body of the European Management Consultancy sector. Its general purpose is to assist in the promotion and development of the profession of Management Consultancy in Europe by providing support to its constituent National Association membership in those areas where a collective voice is stronger than the sum of its individual members.

Its main objective is to contribute to the development of the Management Consultancy market by raising its image and profile at European and international level, the promotion of networking, best practice and business integrity, the representation of the sector on EU level in order to ensure an awareness of and defend professional interests, and a contribution to the EU policy for competitiveness and growth through a positioning on related issues of relevance to the MC sector.

The Federation now counts 23 national member associations;

• 17 from the European Union: Austria, Belgium, Cyprus, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Italy, Poland, Portugal, Slovenia, Spain, Sweden and the United Kingdom;
• two from EFTA: Norway and Switzerland;
• two from Central & Eastern Europe: Bulgaria and Romania;
• one associate member: Bosnia & Herzegovina and
• one affiliate member: Hong Kong.