Consulting Services Overview
The consulting industry includes establishments primarily engaged in providing advice and assistance to businesses and other organizations on a host of issues. Consulting services can include guidance on strategic and organizational planning, financial planning and budgeting, marketing objectives and policies, human resource policies and practices, logistics and distribution, and scientific and technical matters.
Unlike other professional services sectors, consulting services typically do not require licenses to practice, which affords consultants greater flexibilities in providing services in overseas markets. However, some key obstacles affect consulting firms overseas, though larger firms often have more resources to adjust to market restrictions.
As the largest exporters of professional and business services, U.S. consulting firms have a strong international presence. ITA’s Office of Supply Chain, Professional, and Business Services (OSCPBS) supports consulting firms of all sizes in finding new markets overseas.
Factors Affecting Competitiveness
The consulting industry yields enormous profits but is volatile to market forces. Consulting revenue depends on economic growth, and especially on corporate profits. Consultants are considered an expendable cost when companies face an economic slowdown.
Small and mid-size consulting firms face greater competition from bigger firms that can offer clients a variety of services. Big firms are adding fields of expertise through acquisitions, often buying the consulting practices and other non-audit services of accounting firms. Large firms are increasingly expanding their reach into areas once served mainly by small consultants.
Aside from the large consulting firms, most consultants specialize in providing services to a particular company or industry, leaving them vulnerable to customer and industry changes. For example, a large number of IT consulting companies were affected during the Great Recession when corporate customers cut computer technology budgets. Small consulting firms may get the majority of their revenues from a handful of clients.
Consulting firms may encounter a variety of barriers when expanding overseas, such as:
- Mandated affiliation with local firms.
- Minimum requirements for local hiring (ex. a certain percentage of a firm’s employees must be local).
- Restrictions on the type of incorporation or firm structure.
- Restrictions on participation in government procurement contracts.
Consultants looking to practice overseas also may face barriers, including:
- Nationality or residency requirements.
- Restrictive visa requirements.
- Restrictions on movement under a country’s immigration laws.
- Professional registration requirements.
Overall Trade in Management Consulting Services
For the purposes of this report, “services trade” refers to services provided cross-border between supplier and consumer (ex. remotely, virtually, or via mail), as well as services provided when a consumer or supplier travels overseas. Services supplied via affiliates, or commercial presence overseas, are not included in this data. In addition, in this report, “management consulting services” represents data classified by the U.S. Bureau of Economic Analysis (BEA) as “business and management consulting and public relations services.”
The United States has a consistent trade surplus in management consulting services, which grew steadily from 2014 – 2019 but dipped slightly in 2020. Exports in this sector have also more than doubled since 2010. U.S. exports of management consulting services reached $68.5 billion in 2020 with U.S. imports of $44.5 billion and a trade surplus of $24 billion.
This dashboard is interactive – click or hover on the graph to view additional data points and details.
Management Consulting Services Trade by Country
European countries are the primary destinations for U.S. exports of management consulting services. Ireland leads the list of top markets in 2020 by a wide margin, with $15 billion in U.S. exports, followed by the United Kingdom ($8.9 billion), Switzerland ($7.6 billion), Germany ($6.5 billion), and the Netherlands ($4 billion). Important non-European markets include Canada ($2.9 billion in U.S. exports), Singapore ($2.2 billion), Japan ($1.9 billion), and Brazil ($1.8 billion). The United Kingdom’s territories in the Caribbean are also an important destination for U.S. consulting exports, receiving $1.3 billion in 2020.
The United Kingdom is by far the top source for U.S. imports of management consulting services, with $7.8 billion in imports in 2020. However, the United States still has a $1.1 billion trade surplus in consulting services with the UK. While many major U.S. import partners are the same as U.S. export destinations, other notable sources of U.S. consulting services imports include India ($2.8 billion in 2020) and China ($1.7 billion).
This dashboard is interactive – scroll to see additional countries, click on different years, and hover on the map and bar charts to gain further insights.
Management Consulting Services Trade by Region
By region, a majority of both U.S. exports and imports in management consulting services are with Europe, representing 72% of U.S. exports and 53.1% of U.S. imports. However, the Asia Pacific region remains an important partner as well, accounting for 12.8% of U.S. exports and 28.6% of U.S. imports.
While the United States had a surplus of consulting services with Europe and Latin America in 2020, it had deficits with the Asia Pacific, Canada, and the Middle East.
This dashboard is interactive – click on different years or hover on the column and pie charts for additional information.
Are you a consultant or consulting firm seeking to provide services overseas? Are you facing a problematic barrier in another country?
ITA’s Professional and Business Services team is ready to provide expertise and guidance on consulting services trade. ITA also has a network of trade promotion and policy professionals located in more than 100 U.S. Commercial Service offices nationwide and in more than 75 international markets, to assist with additional exporting needs and questions.
Primary ITA Contact on Consulting Services:
Accounting, Legal, and Consulting Services
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