Last year saw a pattern of solid growth in fee income and profitability
among UK PR consultancies, according to research from the PRCA.
The PRCA’s annual comparative survey for 1995, which draws on data from
63 of its 175 members, shows overall fee income up six per cent to
pounds 175 million and profitability rising 11.7 per cent to pounds 26.6
Profitability averaged out at 15.2 per cent of fee income.
Evidence of the industry’s emergence from recession was provided by a
dramatic fall in redundancy costs among the 63 consultancies from pounds
520,000 in 1994 to pounds 123,000 last year.
At the same time recruitment costs have risen 130 per cent to pounds
855,000 and the amount spent on training grew 16 per cent to pounds
There was a 12.9 per cent growth in annual retainers (as opposed to ad
hoc fees) to pounds 70.6 million - equating to 79.7 per cent of all
‘The figures show that the differential between annual retainers and ad
hoc has grown and I think that demonstrates, as we in the business all
know, that PR is strategic,’ said PRCA chairman Quentin Bell.
However, over-servicing of accounts - where consultancies spend more
time on a piece of business than they are paid for - remains a problem,
representing 20 per cent of fees. ‘For some reason we haven’t tackled
that one and we’ve let clients get away with it for too long,’ added
The research also points to an increase in new business wins over the
past 10 years. The number of new clients last year, at 4,047, was up 18
per cent on the 3,426 of 1986.
Forty-six of the consultancies sampled had fee income over pounds 1
million, compared with just 20 in 1986.
* The PRCA has said it will remove members who do not register lobbying
activity with it from its business referral system. Last year this
accounted for some pounds 24 million worth of business - up from pounds
14 million in 1994. The PRCA’s register of professional parliamentary
advisers will be available from April at a cost of pounds 50.