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 Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, 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 8-9 workers, and generates about $3 million annually.

    • The management consulting services industry consists of about 75,900 firms that employ about 664,000 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

                              Coronavirus Update

                              Nov 22, 2021 - Consultants May Benefit from Pandemic-related Work Stress
                              • More than half of respondents to a workforce survey conducted from August 11-16, 2021 by Ipsos said that they are burnt out. Younger workers are feeling the most strain, with 62% reporting burnout. Workers say that implementing a four-day work week and reducing workload would alleviate stress. More than a third of the respondents play to leave their job in the next 12 months. About 51% said that the pandemic has triggered a re-evaluation of their personal priorities.
                              • Management consulting firms may benefit from clients' need for assistance in managing COVID-19 vaccination mandates. A presidential mandate that is scheduled to become effective on January 4, 2022, states that all private employers of 100 or more must require their employees to get vaccinated or undergo weekly testing. Businesses that don’t comply with the new regulation could face fines up to $14,000 per violation. The president also mandated that health care workers, federal contractors and most federal workers be vaccinated. Those executive branch employees who refuse the mandate after a 75-day compliance period could be terminated following a disciplinary process.
                              • Analysts say that the presidential mandate is likely to pressure private employers with fewer than 100 employees to require immunization as well. While vaccination rates have picked up speed in recent weeks as the delta variant spurred a surge in cases, they remain a fraction of what they were in the early months of the vaccine rollout. Just over 55% of the US population is fully vaccinated as of late September.
                              • Some businesses that took PPP loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that meant a deadline in September.
                              • A larger share of distressed companies upended by the COVID-19 pandemic is using court processes to restructure instead of close, according to S&P Global Market Intelligence. Management consulting firms may benefit from the opportunity to help firms navigate the process. Nearly 62% of corporate bankruptcy filings in 2020 sought reorganizations, the highest rate for any year going back to at least 2010. Companies were less likely to liquidate in 2020, a departure from 2019 and 2018 when corporate liquidations outpaced reorganizations in bankruptcy filings. As of March 30, the share of filings seeking restructuring is larger in 2021 than in 2020. S&P analysts note that government stimulus and easy access to capital have kept at-risk companies from entering bankruptcy following a jump in filings during the early months of the pandemic in in 2020, but bankruptcies are likely to pick up again later in 2021 as companies confront the aftershocks of the pandemic.
                              • Many industries may face a resurgence of turnover as employees begin to feel that they can make job moves that were put off during the pandemic. "Company leaders are still knee-deep dealing with the pandemic, but they have to look ahead to fend off a talent tsunami," says Melissa Jezior, president and chief executive officer of Eagle Hill Consulting. "Now that vaccinations are underway, there's light at the end of the tunnel for employees. We all are feeling a sense that work will return to some sense of normalcy and the economy will rebound. And that means employees again will feel confident looking elsewhere for a job." Further complicating the issue for employers is that more than half of the workforce feels burnt out, much of which can be attribute to the COVID-19 work environment, Jezior added. Failure to retain top talent may make it more difficult for a business to move forward in a post-pandemic economy,
                              • Corporate executives are increasingly comfortable using freelance management consultants, according to a report from Harvard Business School. Pandemic-induced cost controls, remote workforces, and a growing familiarity with freelancers are important drivers of freelance consultancy growth.
                              • Management consulting services industry employment increased 8.5% year over year in September and 5.7% from the pre-pandemic month of September 2019, according to the US Census Bureau.
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