UK Universities undertake approximately £9B of research activities every year (Appendix One) and another £1.5B of services for business including CPD and consultancy (appendix two). Although this is a significant absolute sum, these activities typically represent ca. 1/3 of an institution’s income, with the majority coming from student fees. Due to the increased competitiveness of the student market and the relative erosion of the value of fixed home fees, many institutions are seeking to diversify income further, particularly into the relatively high-margin services for business. At the same time, UK universities are under significant staffing pressure with wages typically accounting for over 60% of costs (Durham University staff costs are £330M of £530M). Realisation of their ambitions often requires specialised market analysis that is not in house (or tied up in house). 

Additionally, Universities are working in a very complex environment, for example, in responding to regulations from UK Government in export control. Many smaller institutions cannot afford to hire staff with the necessary expertise. There is therefore a need to have access to a floating pool of expertise to meet very specific requirements.

Meeting these two needs, market analysis and expert support, forms the basis of the offer from SEA Consultancy Ltd. It is known that use of outside consultants has been growing across the public sector, with £2.5B spent by the public sector in 2020/21. Durham University spent £11M on consultants in 2020/21.

SEA Consultancy’s two directors have previously commissioned work for universities. It is their experience that the outcomes and customer service of existing providers can be highly variable, and that therefore there is a gap in the market for high quality/ customer responsive provision.

Business Costs / Assets

The assets of the consultancy are its two Directors. Collectively they have over 25 years of experience in HE, in both research and business services support. They bring with them different but complementary expertise in research governance, statutory reporting (e.g., REF), market analysis, data visualisation, citizen engagement, business and investment case development, and evaluation. Additionally, they have significant national and regional networks at senior level through which at least some business will be expected to flow, alongside public tendering.  

Where required the company will augment internal expertise by commissioning subcontractors on an ad-hoc basis from the three other Russell Group institutions at which they have worked

-          Bargaining power of suppliers. Low – limited numbers for underpinning, somewhat high for specialist domain specilists.

-          Bargaining power of customers. Medium. HE is increasingly competitive and the need for insight and intelligence is keen, roi’s are potentially very strong for limited outlay (UoH £25k investment, £500k back)

-          Competitive rivalry: high – lots of suppliers, however in particular areas 2/3 comparators.

-          Threat of substitutes – low. Internal resourcing remains challenging within Universities. Specialist knowledge is required.