PR consultancy profits are being squeezed by escalating staff costs,
according to a new survey by Willott Kingston Smith and Associates.
However, this hike in staff costs has been offset by a 35 per cent
increase in operating profits per head.
Although this shows a healthy improvement, operating margins on gross
income are still falling short of the recommended 15 per cent.
The survey is taken from the 20 most recent sets of accounts filed with
Companies House.
Meanwhile, the latest copy of the Chartered Institute of Marketing’s
biannual Marketing Trends Survey shows that marketing-led PR spend will
rise by nearly five per cent this year. That compares to a forecast
increase of just 1.3 percent in April.
Of the three hundred companies surveyed, the biggest spenders were found
amongst the utility groups, food and chemical companies and service
industries.
The survey also found that spending on direct mail and marketing
information systems is expected to rise by about five percent, while
advertising budgets are only expected to increase 3.5 per cent.
