Design is proving resilient, but don’t relax just yet

The good news is that reputable design consultancies appear not to be dropping their prices to clients despite the economic downturn (see News).

The Design Business Association’s latest trawl of its members shows the average charge-out rate is up 4 per cent since the end of 2008, when the last survey was conducted. More importantly, the so-called ‘utilisation rate’ – the percentage of staff time billed by consultancies to clients – is up 8 per cent to 71 per cent, suggesting design groups are not devaluing their offer.

The problem, though, is that while DBA members might set the bar for good business practice, they represent only part of the design industry. We can only hope that others – notably non-DBA consultancies traditionally focusing on sectors such as property and financial services that have been badly clobbered by the downturn – are also managing to hold their own.

It has been said many times that the key to survival in these straitened times – apart from producing great work for clients who ‘get it’ – is to keep the lid on overheads and balance earnings realistically with staff numbers. It’s not just about fees.

Design Week’s 2009 Top 100 survey, published in May, indicates that this was happening last year, with a significant number of participants earning well above the £80 000 per head of staff recommended by business pundits. Though times have been tough since then, anecdotal evidence implies that many design groups are optimistic, if a little bemused, that they will come through it okay – better, perhaps, than their advertising or architectural peers, who have proved less flexible in the face of recession.

Moving forward, the important thing is to keep a grip on business aspects, while developing new markets for design. New doors are slowly opening in areas like the public sector, and the market for digital design continues to grow apace, taking creativity way beyond the website now. We just need to keep the momentum going.

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