Management Consulting Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 75,900 management consulting firms in the US assist businesses and organizations with administrative, strategic, and management-related issues. Major revenue categories include strategic and financial management consulting and implementation services. Firms may also offer operations and supply chain, marketing, and human resources management consulting services. Customers include businesses, institutions, non-profit organizations, and government entities.
Competitive Bidding
Many clients use competitive bidding when soliciting management consulting services and preparing bids is a costly process for consulting firms and requires significant amounts of managerial time and effort.
Dependence On Highly-Skilled Labor
Management consulting firms solve complex business problems and rely on highly-skilled, educated, and experienced industry professionals to provide consulting services.
Industry size & Structure
The average management consulting services provider operates out of a single location, employs fewer than 5 workers, and generates about $3 million annually.
- The management consulting services industry consists of about 85,100 firms that employ about 801,300 workers and generate about $232 billion annually.
- The industry is fragmented; the top 50 companies account for 41% of industry revenue.
- Large companies include McKinsey and Company, Booz Allen Hamilton, Boston Consulting Group, Bain, and Accenture. Most large firms offer comprehensive services and operate nationally and internationally.
Industry Forecast
Management Consulting Services Industry Growth
Recent Developments
Apr 16, 2024 - Weaker but Steady Industry Growth
- The management consulting services industry is expected to experience softer but steady sales growth in the coming years. The industry’s year-over-year sales increased by 15% in 2022 before dropping to 8% in 2023, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth is projected to moderate further to 3.1% in 2024, then rise 5.1% in 2025. The industry will then see flat but steady average annual growth of about 5.5% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
- Some consulting firms are struggling to keep all their partners and junior staffers busy after a pullback in demand, according to The Wall Street Journal. The consulting business boomed during the pandemic as clients sought help with evolving remote work needs and supply chain disruptions. More recently, corporations have increased their focus on containing costs and are pulling back on consulting spending amid growing global economic uncertainty. According to Source Global Research, US consulting market growth is projected to slow to about 6% this year after posting double-digit growth during the pandemic. Source Global Research says more than 85% of US clients plan to reduce their consulting spending in 2024. However, some consulting firms believe the downturn is temporary and the market is beginning to improve.
- Consultancy McKinsey & Company plans to eliminate about 360 roles amid weaker demand, according to reporting by Bloomberg in April. Traditional consulting positions will not be affected, as the cuts focus on specialty jobs in data engineering, cloud, software, and design. The headcount reduction follows a similar move in 2023 when McKinsey trimmed about 1,400 support and back-office roles. Other consulting firms, including Accenture, Ernst & Young, and PwC, have also announced workforce reductions.
- A recent spate of white-collar layoffs at firms including Alphabet’s Google, Duolingo, and UPS may signal that generative artificial intelligence (AI) could shake up the white-collar workforce, according to The Wall Street Journal. Since May 2023, firms have cited AI as the reason for about 4,600 layoffs, especially in media and technology, according to outplacement firm Challenger, Gray & Christmas. Some firms are laying off workers after AI implementations, and other layoffs stem from the need to free up budgets for AI investments. Some industry observers suggest that AI could result in flatter corporate hierarchies as the technology takes on more mid-level management tasks. In a recent survey by Oliver Wyman, more than half of managers said their jobs could probably be automated using generative AI.
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