The PRCA Benchmarking survey findings present PR agencies with an
interesting dilemma. At a time when some client companies, and in
particular those with American parentage, may be considering tightening
their belts in terms of marketing spend, it would be only understandable
for consultants to seek the increased security of a retainer
However, the PRCA survey proves quite conclusively that risk equals
profits, with firms with more than 50 per cent of clients on a safe and
secure flat fee deal operating on margins below ten per cent.
By contrast, those firms more willing to espouse project work and
performance related deals are more likely to work on margins above 20
per cent. This will come as no great surprise to those firms who put in
place appropriate charging structures for strategic consultancy.
This year's survey indicated a slightly higher level of retainer
contracts among PRCA members. However, it is the confidence to take
risks, charge appropriate fees and to maximise the potential of
strategic consultancy at a crucial time for all client sectors, that
will prevent the industry talking itself into a recession.