Bees round a honey pot

Consultancies have never had it so good – most show fee-income up by well over 10 per cent this year

SBHD: Consultancies have never had it so good – most show fee-income up by well over 10 per cent this year

IT is encouraging to see so many consultancies increasing design fee-income by well over 10 per cent this year. The Top 10 (Table D) shows that graphics has been particularly lucrative this time – Allen International is the only truly multidisciplinary group in this category, despite Newell and Sorrell’s small interiors section. Lambie-Nairn and Company’s inclusion in this list is significant, given that Design Week has indicated screen graphics – the group’s fort&#233 – as a way forward for design.

There are inevitably factors other than rising workload that have boosted fee-income for some groups. Chart-topper Interbrand, for example, has increased fees by a massive 98 per cent. As we have already indicated, the international identity specialist has enjoyed an upturn in overall fortunes this year, following the merger by parent Omnicom of its New York business with that of US group Schechter at the beginning of 1995. And, of course, the Top 100 submission inc- ludes combined figures for the business worldwide.

There have also been impressive increases from some of the other major players at the top of the charts, where high percentage rises are more difficult to achieve. Table E shows some of the more successful of these, with a spread from product through graphics to events.

It is easier for some disciplines, particularly architecture or corporate identity, to enjoy a sudden leap in fortunes. One big project can make all the difference. Hence we can assume that the British Gas identity won early last year will account in part for Coley Porter Bell’s 44 per cent rise in design fee-income, while Allen International has reported a number of overseas bank identities over the past few months, which we can assume has led to that 69 per cent boost. It all depends when the selling stops and the commissioning begins.

However, the reverse is true for some disciplines, particularly retail and interiors, where the slump has continued and specialist groups have found the work just isn’t there.

Table F highlights those that have not done as well this year as last in terms of design fee-income and have reported a significant reduction. There can be many reasons for this: a big job just completed when the reckoning started for this year’s charts; a planned streamlining of the operation; feelers out for sizeable new commissions but none of them in the bag by the time the Top l00 was completed; or just bad luck.

There might, though, be evidence that consultancies remaining much the same in size and workload, at a time when fee-levels are being eroded all round, are losing out to newer, more thrusting rivals. Those reporting a significant decrease in fees include, after all, some of design’s old guard. Now perhaps is the time for a shift in positions as fresh talents and new disciplines come into play.

SBHD: Productivity and efficiency

Last year we assessed the most efficient consultancies by calculating design fee-income per full-time designer. This year we are calling this productivity rather than efficiency since it is an indication of how much a designer can earn in fee-income each year, rather than the overall efficiency of a consultancy. Design groups employing account handlers, technicians or specialist consultants will often show a high design fee-income per designer, yet may be inefficient overall.

This year we are looking separately at productivity and efficiency, which we now define as design fee-income per member of full-time staff. We are also spanning the full range of consultancies represented in this year’s charts, whether it be in the Top 100 or in the listings of smaller firms to be published next week.

Productivity: Overall productivity improved by 10 per cent, from ú101 000 per designer last year to ú112 000 this year. This is probably because studios are busier, with less down-time, but one must also bear in mind that more groups are now using regular freelance designers, according to Design Week’s recent recruitment trawl (DW 17 February), and their contribution to fee-income is not reflected here.

It is also encouraging to see that last year’s top performers have continued to improve their productivity.

Table G gives a record of this year’s success stories, many of which are in corporate identity or branding and so able to command good fees. It is good, however, to see some of the smaller groups such as Blueberry and Blue Marlin up there with the likes of Siegel & Gale and Wolff Olins.

Efficiency: This is the first time we have looked at design fee-income per head of full-time staff. We have divided design fee-income by the total payroll, and while this excludes freelances and part-time staff, it gives a good indication of efficiency.

The charts (Table H) are topped by identity specialist Siegel & Gale (from the Saatchi & Saatchi stable), branding consultancy Tutssels and packaging group PI Design Consultancy, which share first place with fee-income per head of ú113 000 a year.

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