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RIBA Business Benchmarking 2015 Report prepared for the RIBA by The Fees Bureau

RIBA Business Benchmarking 2015 RIBA Business... · RIBA Business Benchmarking - 2015 Report Page 3 0 Profits Practices’ total profits add up to over £400m. This is 18 per cent

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RIBA Business Benchmarking - 2015 Report Page 1

RIBABusiness Benchmarking2015

Report prepared for the RIBA byThe Fees Bureau

RIBA Business Benchmarking - 2015 Report Page 2

RIBABusiness Benchmarking2015Welcome to the new–look RIBA Benchmarking Survey. Now produced by The Fees Bureau, this report – together with our new online Benchmarker – is designed to give Chartered Practices the tools you need to benchmark your practice.

Following the approach used in the other research reports produced by The Fees Bureau, we’ve attempted to analyse the data in such a way that it is of immediate and practical use to Chartered Practices. You’ll find more data tables and a different visual display of the information compared with the previous reports.

The report remains our analysis of the research – but start using the new online Benchmarker and you will be in control of how you examine the research findings. There are literally hundreds of different permutations you can specify, to examine the data in a way which is even more relevant to your own practice’s circumstances.

We hope you will find the results of this analysis stimulating and informative. For us personally, analysing and writing the RIBA Benchmarking Survey is a high point in the 25 years we have spent researching business information for architects. Please let us have your comments so we can continue to improve the survey next year.

Aziz MirzaVince NaceyDirectors, The Fees Bureau

Data analysis and reporting undertaken by The Fees Bureau, a division of Mirza & Nacey Research Ltd

Data collection by MRM Solutions Ltd

Research undertaken for the Royal Institute of British Architects66 Portland PlaceLondonW1B 1AD

www.architecture.com

December 2015

Copyright © Royal Institute of British Architects 2015

This report is designed to be read in association with the Benchmarking website, available to Chartered Practices at www.ribabenchmark.co.uk

The information in this publication is based on a survey of Chartered Practices undertaken in 2015. Whilst every effort has been made to ensure the accuracy of information in this publication, each of the RIBA, The Fees Bureau/Mirza & Nacey Research Limited and MRM Solutions Limited accepts no responsibility for any omissions, errors of fact or opinions expressed. The information supplied may be used as an aid to decision making but it is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the information.

 

RIBA Business Benchmarking - 2015 Report Page 1

Contents5: Salaries 5.1 Salaries & Dividends: Partners, Directors & Sole Principals 34 5.2 Salaries: Salaried Partners & Directors 35 5.3 Salaries: Associates 36 5.4 Salaries: Architects 5 years + ARB 37 5.5 Salaries: Architects <5 years ARB 38 5.6 Salaries: Technologists 39 5.7 Salaries: Assistants Part 2 40 5.8 Salaries: Assistants Part 1 41 5.9 Salaries: other Chartered 42 5.10 Salaries: other fee earning 43 5.11 Salaries: office management, support and admin 44 5.12 Value of fringe benefits 45

6: Business Policies 6.1 Business Plans 46 6.2 Cashflow & Budgets 47 6.3 Time tracking 48 6.4 Job descriptions, employment policies 49 6.5 Equality, diversity & inclusion 50

7: Work Areas 7.1 Services 51 7.2 Number of Projects 53 7.3 Number of Clients 54

8: New Business 8.1 Bids and outcomes 55 8.2 Hourly rates 57

9: International 9.1 Offices outside the UK 59 9.2 Revenue from outside the UK 60

page:0: Survey Background 0.1 Executive summary 2 0.2 Key statistics and Business Benchmarks 3 0.3 Survey method and respondent profile 4 0.4 Definitions 5

1: Size & Type of Practice 1.1 Staff employed in architectural practices 6 1.2 Staff numbers 7 1.3 Permanent staff 8 1.4 Freelance / contract staff 9 1.5 staff numbers by region 10 1.6 staff numbers by gender 11 1.7 Legal status of practice 12 1.8 Number of offices 13

2: Practice Revenue 2.1 Total revenue - all Chartered Practices 14 2.2 Revenue by practice size 15 2.3 Practice revenue per head 16 2.4 Revenue by region 17 2.5 Revenue by type of work 18 2.5 Revenue by sector 19 2.5 Revenue by client 21 2.5 Revenue by type of service 22

3: Practice Profits 3.1 Profits by size of practice 23 3.2 Profits per head 25 3.3 Dividends 26 3.4 Profits by region 27

4: Practice Expenditure 4.1 Expenditure by size of practice 28 4.2 Personnel 29 4.3 Premises 29 4.4 IT, marketing, legal, financial 30 4.5 Travel 30 4.6 Other expenditure 31

page:

RIBA Business Benchmarking - 2015 Report Page 2

Background 00.1 Executive SummaryIt’s a diverse profession. Certainly, Chartered Practices share many of the same features - practices are generally headed by the people who own them; most are limited liability companies; the type of service offered is broadly similar with little evidence of specialisation or diversifying beyond core design services.

But at the same time, everything is different. Larger practices are focused more on new build work; smaller ones on refurbishment. Larger practices have more clients and jobs, but a smaller number of clients and jobs per head of staff than the small practices – reflecting the fact that jobs undertaken by large practices are bigger. Small practices are very much focused on private housing, and in particular housing work for private individuals; large practices have a much wider spread of activity.

The research findings demonstrate that it’s not really possible to make general points about the profession. So in this new take on the RIBA Benchmarking exercise, we are focusing away from a single benchmark which may be applied to the whole profession, and instead encourage you to use the survey results to create your own benchmarks depending on what size or type of practice yours is. For example, the ‘profit as a per cent of revenue’ figure varies significantly by practice size, as it usually includes some of the Partner or Director’s pay. So smaller practices – where Partners and Directors make up a larger proportion of the staff numbers – need to generate higher percentage profits than larger practices.

£2.4 bn

total revenue

32,000

55%

staff employed in practices, includes 4,400 Partners, Directors, Sole Principals

of practice revenue is from housing. Majority of this is from one-off housing & extensions

124,000projects worked on by practices in the last 12 months

£500 millionrevenue from work on projects outside the UK

RIBA Business Benchmarking - 2015 Report Page 3

0ProfitsPractices’ total profits add up to over £400m. This is 18 per cent of revenue. This proportion varies widely between practices of different sizes; it is considerably higher amongst small practices than for large ones. A key benchmark, but as it varies so much by size it’s important to consider this benchmark at the correct level for your practice’s size profile.

SalariesPractices spend 40 per cent of revenues on paying salaries. Average salaries increase with practice size, for all staff types.Use this benchmark as an aid to compare with the salaries you pay, not just against similar sized practices but against other practices with whom you compete when recruiting.

50+ staff

10 to <20 staff

3 to <5 staff

36%

25%

12%

£38,000

£43,500

£42,000

Partners, Directors, Sole Principals

Architects <5 years ARB

Architects 5+ years ARB

Associates

£32,000

RevenueTaken together, £2.4 billion worth of revenue was generated by RIBA Chartered Practices in the last 12 months. A small number of very large practices account for a disproportionate share of total revenues; while 55 per cent of this revenue came from London based practices. Revenue is the fundamental practice Benchmark. Although average revenue per practice varies hugely by practice size, revenue per head is a relatively more even figure, averaging £56,000 across all practice sizes.

50+ staff

10 to <20 staff

3 to <5 staff

£51,600

£66,300£91,600Average practice revenue per head, all fee earning staff, selected practice sizes.See section 2, pages 14-23

Business Plans & CashflowA majority of small practices plan up to 12 months ahead, a majority of larger practices plan for the next two, three or more years. Similarly, with cashflow: the larger the practice, the longer the time period over which the cashflow forecast is made. It’s vital to plan ahead and these benchmarks will reveal how far ahead other, similarly sized, practices are looking.

50+ staff

10 to <20 staff

3 to <5 staff

41%

67%71%

Success at winning workPractices report a success rate, on average, of 55 per cent. This varies by size; smaller practices have a higher success rate than larger ones. This is partly due to smaller practices being more likely to be appointed without being involved in a competitive process. Explore this benchmark further by looking at how bids were won.

50+ staff

10 to <20 staff

3 to <5 staff

59%

51% 37%

Average practice profits as a per cent of revenue, selected practice sizes.See section 3, pages 24-27

Average earnings for selected staff, all practice sizes UK average.See section 5, pages 32-45

Proportion of bids won - last 12 months, selected practice sizes.See section 8, pages 55-56

Practices whose Business Plans extend to 2 years or more, selected practice sizes.See section 6, pages 46-48

0.2 Key Statistics and Business Benchmarks

RIBA Business Benchmarking - 2015 Report Page 4

Practice size per cent 1 142 133 to <5 185 to <10 2510 to <20 1520 to <50 950 to <100 3100+ 2ALL 100

The RIBA Benchmarking Survey has been established for a number of years and it is mandatory for Chartered Practices to participate in the survey. Respondents completed an online survey questionnaire, data was then analysed and tabulations produced. The survey questionnaire was completely re-designed this year. Therefore, the information in this year’s survey may not be precisely comparable with that from previous years. Our thanks go to all Chartered Practices for participating in this year’s Benchmarking Survey.

The response profile is detailed in Tables 0-1 and 0-2. Practices from London, and small practices (with fewer than 5 staff) account for a large proportion of total response, however, this is consistent with the membership profile of Chartered Practices.

Data is analysed by practice size and by region. Where there is insufficient response, the cell is marked as n/a. We continue the practice of previous RIBA Benchmarking surveys of only reporting cells where the cell size is 30 or more. This prevents any chance of an individual practice being identified. Consequently, some information (eg salaries for specific staff groups) for regions and size groups which have small numbers of practices, is limited or not available.

0.3 Survey Method and Respondent Profile

Chart 0-1Survey response by size of practice

100+50 to <100

20 to <50

10 to <20

5 to <103 to <5

2

1

Table 0-2Number of respondents by practice size (number of staff)

RIBA Region per cent South West 7Wessex 3South 6South East 11London 36West Midlands 5East Midlands 4East 7North West 7Yorkshire 5North East 2Wales 2Scotland 2Northern Ireland 2ALL 100

Table 0-1Number of respondents by region

Wales

LondonSouth West

Wessex

South East

Yorkshire

North East

Scotland

East

Northern Ireland

West Midlands

East Midlands

South

North West

The two largest size groups are merged into one (50 plus) to give a larger and therefore more statistically valid group for the analysis

Chart 0-2Definition of the RIBA regions as used in this survey

RIBA Business Benchmarking - 2015 Report Page 5

0.4 DefinitionsReporting PointAll data as at 01 May 2015 unless stated otherwise.

Financial data for the 12 months ending 01 May 2015, or the closest financial period for which responding practices had data available when they completed the questionnaire.

Practice SizeSize is based on the number of staff, Full-time Equivalent, and including both Permanent staff and Freelance / Temporary staff working in the practice on 01 May 2015.

StaffingAll staffing data is presented as Full-time Equivalent (FTE).

Equity Partner : a Partner who owns a share of the practice.

Shareholding Director : a Director who owns a share of the practice.

Salaried Partner : a Partner who does not own a share of the practice. In this instance, the title ‘Partner’ would usually be to denote seniority.

Non-shareholder Director : someone with the title ‘Director’ who does not own a share in the practice. The title usually denotes seniority.

Associate Director or Associate : a senior member of staff, below Director level, who has been given this title.

Architect (5 years or more ARB registered, or equivalent to ARB if from outside the UK) : an architect, who is fully qualified and registered with the ARB and has been fully qualified and registered for at least five years. The staff member may or may not be a Chartered Architect.

Architect (under 5 years ARB registered, or equivalent to ARB if from outside the UK) : an architect, who is fully qualified and registered with the ARB and has been fully qualified and registered for less than five years. ARB equivalent if outside the UK. The staff member may or may not be a Chartered Architect.

Technologist : Staff member who is likely to have received some formal architectural training, and is likely to be a member of the CIAT (Chartered Institute of Architectural Technologists).

Architectural Assistant (Part 2 qualified) : staff member who has received formal architectural training to Part 2 level. This includes people who are working towards their Part 3 examinations.

Architectural Assistant (Part 1 qualified) : staff member who has received formal architectural training to Part 1 level. This includes people who are working towards their Part 2 examinations.

Other Chartered construction professionals : professional, Chartered members of organisations which are members of the Construction Industry Council, eg RICS, RTPI, CIBSE, ICE, CIOB - see full list at CIC website, www.cic.org.uk/about-us/cic-members.php

Other fee earning staff : staff who offer services which are directly chargeable to clients, for example interior designers.

Office management / other support and admin staff : staff who provide a management, specialist or support role for the practice, i.e. everyone who has not been identified above.

Revenue, Profits, ExpenditurePractices were asked to source revenue data from their audited or end of year accounts, as prepared by their accountant. If that is not available, or respondents felt this provided an inaccurate portrait of their practice, then practices were asked to source data from their management accounts. Respondents were asked to answer all questions using the same set of accounts to permit a consistent statistical base.

Practice revenue : the turnover, or fee income, of the practice.

The profits figure is stated before the deduction of tax.

VAT is not included either in revenue or expenditure data. This remains the case for practices who are not VAT registered.

Building SectorsNew build : an entirely new structure.

Refurbishment : work to an existing building.

Conservation : work to buildings originally constructed pre 1919, or a Listed Building

Types of ServiceFull Service : preparation & brief, concept, developed, and technical design, plus administration of the building contract for the construction phase. This corresponds to work stages 1 to 6 RIBA Plan of Work 2013. It may additionally include stages 0 (strategic definition) and 7 (in use). See www.ribaplanofwork.com

Work Stages 1 to 3 in the RIBA Plan of Work 2013 : preparation & brief, concept and developed design including information required for Planning.See www.ribaplanofwork.com

Work Stages 4 to 6 in the RIBA Plan of Work 2013 : preparation of technical design; administration of the Building Contract for the construction phase, to include regular site inspections and review of progress, to conclusion and handover to client. See www.ribaplanofwork.com

Hourly charge-out ratesThe average charge-out rates that are used for calculating fees on projects.

Outside the UKOutside the UK – everywhere geographically outside the UK, although for the purposes of this survey we include the Isle of Man and the Channel Islands as the UK.

RIBA Business Benchmarking - 2015 Report Page 6

Size & Type of Practice 11.1 Staff employed in Architectural PracticesThe architectural profession is dominated by many very small practices. Fourteen per cent of practices have just one staff member – the practice owner; nearly as many have two. Nearly half (45 per cent) of all practices have fewer than five staff; 70 per cent have fewer than ten staff. At the other end of the size scale, just 5 per cent of practices employ 50 or more staff.

Overall, more than 32,000 staff (full-time equivalent) are employed in Chartered Practices. But the profile of the distribution of the number of staff is very different from the distribution of the number of practices. Almost exactly half of staff are employed in practices with more than 50 staff. So the 120 largest practices employ as many staff as all other 3,000+ practices put together (see chart 1-3).

The total number of staff employed is higher now than at any point in the past four surveys. The increase since the 2014 survey is 15 per cent: another 4,000 FTE staff are employed.

Chart 1-1ALL staff numbers and type

office management /support

other fee earning

other Chartered

Arch. Assistants

Technologists

Architects

Associates

Partners, Directors, Sole Principals

Table 1-1Practice size - ALL number of staff

per cent / number

per cent of practices

Total no. staff (FTE) employed in

ALL practices1 14 318 2 13 585 3 to <5 18 1,393 5 to <10 25 3,841 10 to <20 15 4,639 20 to <50 9 5,654 50 + 5 15,995 ALL 100 32,426

num

ber o

f sta

ff em

ploy

ed in

all

prac

tices

0

5000

10000

15000

20000

25000

30000

35000

2015201420132012

Chart 1-2Total number of staff employed in architectural practices: Trends 2012 to 2015

Source of back data: previous RIBA Business Benchmarking surveys, 2011/12 to 2013/14

RIBA Business Benchmarking - 2015 Report Page 7

11.2 Staff numbers

0

50

100

150

200

250

300

350

1009590858075706560555045403530252015105

num

ber o

f pra

ctic

es

practice size - number of staff

Chart 1-3Number of staff employed by practices

0 20 40 60 80 100

share ofall practice

staff

share ofnumber ofpractices

50 +20 to <5010 to <205 to <103 to <521practice size: number of staff

per cent share

Chart 1-4Employment of staff analysed by practice size

Staff numbers include the practice owner (Partner, Director or Sole Principal) and also include any freelance or temporary staff working in the practice on 01 May 2015. The figures include 2,100 freelance or temporary staff.

Fifteen per cent of all staff employed in practices are Equity Partners or Shareholding Directors, while another 3 per cent are Salaried Partners or Directors. So nearly one in five practice staff are owners or very senior. The ratio of Partners, Directors and Sole Principals declines with practice size, so clearly virtually all staff in 1 or 2 person practices are Partners, Directors or Sole Principals, but this falls to 20 per cent in size 10 to <20, and 9 per cent in practices with 50 or more staff. And in these largest practices, 40 per cent of

Partners and Directors are Salaried Partners and Directors, a far higher proportion than overall (18 per cent). Nearly one third (32 per cent) of all staff are salaried Architects – including Associates. Ten per cent of staff are Technologists, while 18 per cent are Architectural Assistants. There are twice as many Part 2 Assistants as Part 1, this is a consistent ratio for all practice sizes above 5 staff. Other professionals with a Chartered construction industry status account for 4 per cent of all staff, other fee-earning staff total 7 per cent of staff, while office administration and support staff account for 12 per cent of all practice staff. The proportion of support staff is remarkably constant for all practices with more than 2 staff; ranging between 11 and 13 per cent of staff for each practice size.

RIBA Business Benchmarking - 2015 Report Page 8

1.3 Staff numbers - Permanent Staff

Table 1-2Average number of staff per practice - Permanent Staff

number (FTE) practice size1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

equity Partners, shareholder Directors, or Sole Principals 1.0 1.4 1.5 1.8 2.2 3.0 6.9 2.0

salaried Partners or non-shareholder Directors 0.0 0.0 0.1 0.1 0.4 0.9 4.4 0.4

Associate Directors or Associates 0.0 0.0 0.1 0.4 1.4 3.6 20.3 1.7Architects (5 years + ARB registered) 0.0 0.0 0.2 0.6 1.3 3.1 14.0 1.4Architects (<5 years ARB registered) 0.0 0.0 0.1 0.4 1.2 2.7 12.7 1.2

Technologists 0.0 0.0 0.2 0.6 1.5 3.0 9.6 1.2Architectural Assistants (Part 2) 0.0 0.0 0.2 0.8 1.6 3.9 15.3 1.6Architectural Assistants (Part 1) 0.0 0.0 0.2 0.5 1.1 2.0 6.0 0.8other Chartered constr. professional 0.0 0.0 0.0 0.1 0.1 0.6 7.5 0.5other fee earning staff 0.0 0.0 0.1 0.2 0.5 1.8 12.5 1.0office management / support & admin 0.0 0.2 0.3 0.7 1.6 3.2 16.6 1.7ALL 1.0 1.8 2.9 6.1 12.7 27.9 125.7 13.6

The vast majority of staff employed by architectural practices – 94 per cent – are employed on a ‘permanent’ basis. That equates to 30,300 full-time equivalent staff. The average number of permanent staff by practice size is shown in Table 1-2 below. On average, an architectural practice has 13.6 FTE staff, including 2.0 Partners, Directors and Sole Principals, 1.7 Associates, 2.6 Architects, 1.2 Technologists and 2.4 Architectural Assistants.

Chart 1-5Ratio of Permanent to Temporary/Freelance Staff

Temporary /Freelance

Permanent

RIBA Business Benchmarking - 2015 Report Page 9

1.4 Staff numbers - Freelance / Contract Staff

Table 1-3Average number of staff per practice - Freelance and Contract Staff

number (FTE) practice size1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

Associate Directors or Associates 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0Architects (5 years + ARB registered) 0.0 0.0 0.1 0.1 0.2 0.2 0.8 0.1Architects (<5 years ARB registered) 0.0 0.0 0.0 0.0 0.0 0.1 0.5 0.1

Technologists 0.0 0.0 0.1 0.1 0.2 0.3 1.7 0.2Architectural Assistants (Part 2) 0.0 0.0 0.1 0.1 0.1 0.2 0.4 0.1Architectural Assistants (Part 1) 0.0 0.0 0.1 0.1 0.0 0.1 0.2 0.0other Chartered constr. professional 0.0 0.0 0.0 0.0 0.0 0.1 2.3 0.1other fee earning staff 0.0 0.0 0.0 0.1 0.1 0.2 1.1 0.1office management / support & admin 0.0 0.0 0.1 0.1 0.1 0.2 0.5 0.1ALL 0.0 0.2 0.5 0.6 0.8 1.4 7.6 0.9

Six per cent of staff working in architectural practices are working on a freelance or temporary basis on the 01 May 2015. That equates to 2,100 full-time equivalent. The proportion of staff who are freelancers varies quite considerably by practice size; ranging from about 5 per cent in practices with more than 20 staff, to about 9 per cent in practices with 2 or 5 to <10 staff, while the peak employment of freelancers is recorded by practices of size 3 to <5 – where 16 per cent of staff are freelance or temporary.

aver

age

per c

ent f

reel

ance

sta

ff

0

5

10

15

20

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 1-6Proportion of Temporary/Freelance staff by size of practice

RIBA Business Benchmarking - 2015 Report Page 10

1.5 Staff numbers by region

Chart 1-8Average number of staff per practice, by region

number (FTE) regionSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

equity Partners, shareholder Directors, or Sole Principals 1.9 1.7 2.0 1.8 2.1 2.0 1.9 1.8 2.0 2.3 2.0 2.0 2.5 2.2

salaried Partners or non-shareholder Directors 0.3 0.1 0.4 0.3 0.6 0.4 0.7 0.2 0.3 0.3 0.2 0.8 0.5 0.3

Associate Directors 1.2 0.6 1.2 1.4 2.4 1.1 2.0 0.8 2.0 1.7 1.6 1.8 2.4 0.7Architects (5 years + ARB) 0.8 0.7 1.2 1.2 2.1 0.8 1.7 0.8 1.6 1.5 1.0 1.7 2.2 1.6Architects (<5 years ARB) 0.5 0.5 0.7 0.7 2.3 0.9 1.0 0.4 1.0 0.7 0.7 0.7 1.3 0.6Technologists 1.6 0.7 1.2 1.1 1.0 1.4 2.7 1.7 1.9 2.5 1.5 2.6 1.6 1.8Architectural Assistants (Part 2) 0.8 0.6 1.1 0.9 3.1 1.2 1.4 0.6 1.0 1.0 0.7 0.7 2.0 1.0Architectural Assistants (Part 1) 0.8 0.5 0.6 0.7 1.2 0.7 1.1 0.5 0.7 0.7 0.5 0.6 0.6 0.5other Chartered constr. prof 0.4 0.0 2.4 0.3 0.7 0.2 1.3 0.2 0.7 0.5 0.2 0.2 0.3 0.3other fee earning staff 0.7 0.1 1.8 0.7 1.3 0.5 2.4 0.4 1.5 0.7 0.2 1.3 1.1 0.2office management / support 1.4 0.9 1.4 1.4 2.3 1.3 2.4 1.1 1.8 1.7 1.4 2.1 1.6 1.2ALL 10.4 6.5 14.0 10.7 19.1 10.4 18.6 8.5 14.5 13.8 9.9 14.5 16.2 10.0

TOTAL No. STAFF EMPLOYED 1,654 488 1,898 2,607 15,355 1,050 1,577 1,320 2,399 1,616 487 766 698 511

Table 1-4Average number of staff per practice analysed by region (permanent and freelance / contract staff combined)

Looking at total staff numbers - permanent and freelance combined, for all Chartered Practices - shows that more than 15,000 staff work for London practices. This is 47 per cent of all staff employed in UK Chartered Practices. This puts London practices way ahead of any other region in terms of employment: the next closest are the South East and the North West, each employing about 2,500 staff.

The average practice size in London is 19.1 staff, and 18.6 in the East Midlands, ahead of other regions. The smallest average practice sizes, of below 10 staff, are recorded in Wessex, the East of England, and Yorkshire.

NorthernIreland

ScotlandWales

North East

Yorkshire

North West

East

East Midlands

West Midlands

London

South East

SouthWessex

South West

Chart 1-7Share of total practice staff employment by region

avearge number of staff per practice

17.0 and over

under 9.0

9.0 to 12.9

13.0 to 16.9

RIBA Business Benchmarking - 2015 Report Page 11

per cent permanent freelance ALL STAFFmale female male female male female

1 85 15 23 77 84 162 64 36 59 41 64 363 to <5 69 31 57 43 67 335 to <10 65 35 60 40 65 3510 to <20 66 34 67 33 66 3420 to <50 65 35 66 34 65 3550 + 64 36 75 25 65 35ALL 65 35 68 32 65 35

per cent permanent freelance ALL STAFFmale female male female male female

equity Partners, shareholder Directors, or Sole Principals

83 17 n/a n/a 83 17

salaried Partners or non-shareholder Directors

80 20 n/a n/a 80 20

Associate Directors or Associates 76 24 74 26 76 24Architects (5 years + ARB registered) 72 28 75 25 72 28Architects (<5 years ARB registered) 60 40 74 26 61 39Technologists 85 15 77 23 84 16Architectural Assistants (Part 2) 60 40 59 41 60 40Architectural Assistants (Part 1) 59 41 56 44 58 42other Chartered constr. professional 66 34 88 12 71 29other fee earning staff 57 43 65 35 58 42office management / support & admin 24 76 30 70 25 75ALL 65 35 68 32 65 35

Overall, 65 per cent of staff working in architectural practices are male, 35 per cent are female. The figure for permanent staff is 65 per cent male and 35 per cent female, compared with 68 per cent male and 32 per cent female amongst freelance staff. The proportion of male/female staff is remarkably similar for all but the very smallest practice size. In a one person practice, the overwhelming majority of staff – 84 per cent – are male, and 16 per cent are female. But for all other practice sizes, female staff account for between 34 and 37 per cent.

Analysed by staff type, across all practice sizes, the proportion of women in the workforce declines with seniority. Between 41 and 42 per cent of Architectural Assistants are female, as are 40 per cent of recently qualified Architects (registered for less than five years), falling to 29 per cent of more senior Architects (registered for five years or more). The proportion of females falls even further to 24 per cent

of Associates, 20 per cent of Salaried Partners or Directors, and to just 17 per cent of Equity Partners, Directors or Sole Principals. This low of 17 per cent is the lowest proportion of females amongst any of the staff categories. There is one staff group which is the exception to this relationship between the number of females and seniority; Technologists. Just 18 per cent of Technologists are female. There is only one staff group where women out-number men; in office management, support and administrative roles.

London practices employ more female staff than any other part of the UK; in the capital, 39 per cent of practice staff are female, compared with the UK average of 35 per cent. But in only one other region is the national average exceeded: just over 35 per cent of the staff employed by practices in Wessex are female. Regions where practices employ the lowest numbers of females are the East Midlands (27 per cent) and Yorkshire (28 per cent).

1.6 Staff numbers by gender

Table 1-6Gender of staff analysed by size of practice

Table 1-5Gender of staff analysed by staff type

RIBA Business Benchmarking - 2015 Report Page 12

1.7 Legal status of practice

Table 1-7Legal status of the practice

per cent practice size1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

Partnership 1 12 8 7 6 5 3 6Limited Liability Partnership (LLP) 1 5 6 9 12 18 23 9Limited Company (Ltd) 47 61 72 78 81 76 72 70Public Limited Company (PLC) 0 0 0 0 0 1 0 0Sole Trader 51 22 14 6 1 1 1 15Charitable Trust 0 0 0 0 0 0 0 0Co-operative 0 0 0 0 0 0 0 0Employee Trust (oprofit sharing) 0 0 0 0 0 0 2 0Local Authority 0 0 0 0 0 0 1 0not sure 0 0 0 0 0 0 0 0ALL 100 100 100 100 100 100 100 100

VAT registered 30 65 89 98 99 100 100 83

Chart 1-9Legal status

Chart 1-10 (right)Whether practices are VAT registered

The majority of architectural practices are established as limited companies. This is the case for over 70 per cent of practices with more than 3 staff and even 47 per cent of one person practices. Just 9 per cent of practices are established as Limited Liability Partnerships (LLPs) although the proportion increases with practice size, so that 18 per cent of 20 to <50 and 23 per cent of 50+ practices are established in this way. The traditional Partnership is used by 6 per cent of practices. Although 15 per cent of practices overall are Sole Traders, this is mainly the case for very small practices, including 51 per cent of one person practices.

Overall, 83 per cent of practices are registered for VAT; although this proportion falls for the very smallest practices: 65 per cent of two person practices are VAT registered but just 30 per cent of one person practices are. The lower levels of VAT registration amongst one and two person practices makes them more competitive for design work commissioned by private individuals.

notregistered

VATregistered

Others

Sole Trader

PLC

Limited Company(Ltd)

Limited LiabilityPartnership (LLP)

Partnership

RIBA Business Benchmarking - 2015 Report Page 13

1.8 Number of offices

Table 1-8Number of offices operated by practices (UK only)

per cent practice size1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

OFFICES WITHIN THE UK:1 office 99 97 96 93 86 69 45 892 offices 1 3 5 7 11 23 18 83 offices 0 0 0 0 2 6 18 24 offices 0 0 0 0 0 1 8 05+ offices 0 0 0 0 0 1 12 1ALL 100 100 100 100 100 100 100 100

Most Chartered Practices operate from just one office. A majority of all practices with under 50 staff have one office. Even 44 per cent of practices with 50 or more staff have one UK office. Twenty one per cent of practices with 20 to <50 staff have a second UK office; 6 per cent have a third. In practices with 50 or more staff, 18 per cent have two offices, another 18 per cent three, 8 per cent four while 12 per cent have five or more UK offices.

Chart 1-11Number of offices (UK only)

5 or more offices4 offices

3 offices

2 offices

1 office

per cent regionSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

OFFICES WITHIN THE UK:1 office 92 95 90 86 91 87 85 92 88 80 92 75 81 902 offices 6 4 7 10 6 12 9 6 10 11 8 13 12 103 offices 0 1 1 2 1 0 2 2 2 7 0 8 5 04 offices 1 0 0 0 0 0 2 1 0 2 0 0 0 05+ offices 1 0 1 1 1 1 1 0 1 1 0 4 2 0ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 14

Revenue 22.1 Total Revenue - all Chartered Practices

Chart 2-2Comparison of share of total practice revenue, by size of practice, with share of total staffing and total number of practices

0 20 40 60 80 100

share ofall practice

revenue

share ofall practice

staff

share ofnumber ofpractices

50 +20 to <5010 to <205 to <103 to <521practice size: number of staff

per cent share

Chartered Practices generated £2.4 billion worth of revenue in the 12 months up to May 2015. £1.4 billion of this, or 60 per cent of total practice revenue, was earned by the 120 practices with 50 or more staff. This compares with these same practices employing 50 per cent of all staff employed throughout Chartered Practices. Clearly large practices contribute disproportionately to the total market. Contrast the £1.4 billion revenue of the 120 largest practices with a revenue of £14 million, generated by the 318 one person practices (0.6 per cent of the total share).

Total revenues have increased in each of the last four years; the increase in the last 12 months is the sharpest, at 28 per cent.

While it is to be expected that the largest practices produced the greatest share of revenues, it is perhaps more surprising to find just how dominant one region is in terms of architectural revenue. The figures show an extreme geographic concentration of the profession’s earnings; London based practices account for as much as 55 per cent of total architectural revenue (see Table 2-3).

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Chart 2-1Total architectural revenue: Trends 2012 to 2015

Source of back data: previous RIBA Business Benchmarking surveys, 2011/12 to 2013/14

RIBA Business Benchmarking - 2015 Report Page 15

22.2 Practice Revenue by size

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0

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4000000

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Table 2-1Average practice revenue, analysed by size of practice

£ average practice revenueMEAN lower quartile MEDIAN upper quartile

1 43,225 20,424 36,919 57,5202 74,518 40,000 62,900 96,6633 to <5 152,054 81,748 130,000 182,6595 to <10 319,433 195,128 283,051 393,91410 to <20 784,393 544,942 719,895 967,30220 to <50 2,024,267 1,315,244 1,744,397 2,356,66850 + 11,853,293 4,183,656 6,137,193 11,315,360ALL 1,055,480 74,569 216,769 637,613

Chart 2-3Average practice revenue per practice

The average revenue per practice, for different practice sizes, is shown in Table 2-1 below. A quick technical explanation; we report both the mean average, and the median average – the latter shows the ‘middle’ value when all practice revenues are sorted in size order, while the lower and upper quartiles show the practice revenue for a practice at the one quarter, and three quarters position in this same ordered list. There is some difference between mean averages and median averages – the mean average can be adversely affected by extremely high (or low) values. For the sake of consistency, and simplicity, we have chosen to generally report figures as mean averages although we have selectively included median averages, where we feel this might be helpful,. The difference between mean and median averages when analysed by practice size is generally no greater than 20 per cent, except for the largest practice size (50+ staff) where there is the widest variation in reported values.

The figures show that for a practice with between 5 and <10 staff, the mean average revenue is £319,000. The median average value is £283,000 although the range of values reported is large – one quarter of practices in this size group generated a fee revenue of £195,000 or less; while another quarter earned revenues in excess of £394,000. Throughout the practice sizes, there is considerable variation in the figures provided, as is demonstrated by the gap between lower and upper quartile figures. Even in practice sizes of one or two staff, where the variation cannot be explained by having a range of staff, the upper quartile figure is more than double the lower quartile figure.

The comparison over time suggests average (mean) practice revenues have been fairly flat for most practice sizes, with a more significant variation only for the largest practices although even here there is no clear trend over the four years.

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15.0 average revenue per practice, £ million

50+(right hand scale)

20 to <50(left hand scale)

5 to <10

10 to <20(left hand scale)

Chart 2-4Average revenue per practice, selected practice sizes: Trends 2012 to 2015

Source of back data: previous RIBA Business Benchmarking surveys, 2011/12 to 2013/14

RIBA Business Benchmarking - 2015 Report Page 16

Table 2-2Average practice revenue per head

2.3 Practice Revenue per head

£ per head average (mean) practice revenue per head1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

per Partner/Director/Sole Principal 42,826 55,102 109,607 187,429 366,827 635,050 1,269,264 262,418

per Architect 42,786 51,692 79,633 100,015 123,868 161,849 190,149 96,121

per Architectural Staff 42,742 44,331 54,583 57,212 71,724 90,173 118,394 61,536

per all Fee earning Staff 42,717 43,310 51,601 53,203 66,297 77,425 91,605 56,424

The average revenue per head figures are more precise benchmarks than the average practice revenue figures, because for practices with a range of staff (practice size 3 upwards) the figures are divided by the precise number of ‘heads’. So average per head figures are directly comparable across the practice sizes. And the figures show a consistent finding – that average revenue per head rises in line with practice size. The more heads a practice has, the higher the

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Chart 2-5Average practice revenue per head - Partners, Directors, Sole Principals

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Chart 2-6Average practice revenue per head - all fee earning staff

average revenue per head. This is absolutely consistent for every indicator examined – see Table 2-2. So, the average revenue per Principal in a 3 to <5 sized practice is £110,000 but this rises to £367,000 in a 10 to <20 sized practice. The rises continue, although to a smaller level of magnitude, when looking at revenue per all fee-earning staff: in a 3 to <5 sized practice the figure is £52,000 which then rises to £66,000 in a 10 to <20 sized practice.

RIBA Business Benchmarking - 2015 Report Page 17

2.4 Revenue by region

Table 2-3Average revenue per practice, analysed by region

Chart 2-7Average revenue by region

£ average practice revenue TOTAL practice revenueMEAN lower quartile MEDIAN upper quartile

South West 542,400 72,048 181,690 462,651 86,241,523Wessex 344,517 51,878 182,866 450,640 25,838,762South 968,914 89,050 225,011 629,131 131,772,357South East 719,457 56,906 154,270 425,329 174,828,111London 1,635,107 83,342 255,105 910,160 1,316,260,833West Midlands 605,976 87,714 254,541 562,262 61,203,531East Midlands 1,179,839 61,819 205,953 616,304 100,286,274East 402,269 61,281 218,278 427,579 62,351,695North West 888,866 76,000 189,676 524,069 146,662,902Yorkshire 966,398 73,559 203,357 610,046 113,068,543North East 583,743 80,000 220,503 519,870 28,603,414Wales 936,439 66,484 135,496 385,006 49,631,261Scotland 847,365 180,677 405,000 1,181,822 36,436,706Northern Ireland 526,760 96,000 258,198 667,384 25,811,261ALL 1,055,480 74,569 216,769 637,613 2,358,997,173

Chartered Practices in London generate 56 per cent of total revenues raised by all practices in the latest financial year. This compares with London’s practices employing 47 per cent of all the staff employed in Chartered Practices.

Average (mean) revenue per practice figures by region will be heavily influenced by the presence – or absence – of very large practices. Therefore, it is not surprising to see average practice revenues are highest in London at £1.6 million. Although second highest is the average for practices in the East Midlands, at £1.2 million. Average practice revenues are above £900,000 in the South, Yorkshire and Wales. Lowest average (mean) practice revenues are reported by practices in the East and Wessex.

The average practice revenues are somewhat different when looking at the median average; the presence of very large practices, with very high revenues, in some regions does, or course, affect the mean value. Median values are lower - usually substantially lower - in every region. Perhaps surprisingly, the median practice revenue is not highest in London; it is higher in Scotland and Northern Ireland.

£1.5 m and over

under £550,000

£550,000 to £899,999

£900,000 to £1.49 m

avearge revenue per practice

RIBA Business Benchmarking - 2015 Report Page 18

2.5 Revenue by type of workChart 2-8Source of practice revenue - type of work

other

conservation

both new buildand refurbishment

refurbishment

new build

per cent average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

new build 21 24 30 38 42 52 60 35refurbishment 43 40 32 30 27 22 18 32both new build and refurbishment 23 23 24 20 18 17 12 21conservation 6 7 8 7 6 3 2 6other 7 5 6 5 7 6 8 6ALL 100 100 100 100 100 100 100 100

Table 2-4Average practice revenue, analysed by type of work

Average practice revenues are divided fairly evenly between new build and refurbishment work. Thirty five per cent of revenue is generated from new build work; 32 per cent for refurbishment, and 21 per cent is from jobs which are both new build and refurbishment. However, when examined by practice size, the distribution of work between the two is far from equal. In 1 or 2 person practices, about twice as much revenue is generated from refurbishment only jobs compared with new build only jobs. The relationship switches for larger practices so that by size group 10 to <20 staff, 42 per cent of revenue comes from new build only jobs, compare with 27 per cent from refurbishment only. New build dominates even more as size increases so for practices with 50 or more staff, 60 percent of revenue comes from new build only compared with just 18 per cent from refurbishment only jobs.

Conservation work accounts for an average 6 per cent of practice revenue, being between 6 and 8 per cent for practices of up to 20 staff - and less than this for larger practices. Revenue from ‘other’ sources accounts for between 5 and 8 per cent of revenue in practices of all sizes.

per cent average (mean) per cent of practice revenueSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

new build 38 33 36 35 32 39 40 41 35 40 36 36 37 46refurbishment 27 24 28 32 37 28 31 28 30 29 30 30 37 21both new build and refurbishment

21 32 24 22 20 21 15 18 20 18 17 21 14 23

conservation 7 8 7 6 5 7 8 9 8 5 9 9 7 4other 6 5 4 5 7 5 6 4 7 7 8 4 6 8ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 19

2.6 Revenue by sectorChart 2-9Source of practice revenue - sector

others

public housing

education

health

industrial

culture /entertainment

sport / leisure

retail

officesother private housing

one-off house,extension

More than half of practice revenue in practices with under five staff comes from one sector – one-off housing. This work includes house extensions and alterations. For one person practices, this sector accounts for 69 per cent of revenue. Even in medium sized practices with fewer than 20 staff, one-off housing accounts for at least a quarter of total practice revenue. Other private housing is the second most important sector for the profession, accounting for 14 per cent of revenues. Unlike one-off housing, the remainder of private housing represents a fairly similar proportion of revenues, of between 12 and 16 per cent, across all practice sizes except one person practices.

Generally, as practice size increases, there is more diversification between sectors and less of a concentration on private housing. For practices with 10 or more staff, education becomes the next most important sector, accounting for between 12 and 16 per cent of revenues for these larger firms. The relative importance of commercial work increases by practice size, so office work accounts for over 5 per cent of revenues for practices with 5 or more staff, while retail accounts for over 5 per cent in practices with 10 or more staff. Sport and leisure is the source of 6 per cent of revenues in practices with 20 or more staff.

Table 2-5Average practice revenue, analysed by sector of work

per cent average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

one-off new house, extension, conversion, alteration 69 63 50 36 24 9 2 41

other private housing 8 12 13 16 15 16 16 14offices 2 3 4 6 6 8 13 5retail 2 2 4 4 5 9 9 4sport and leisure 1 2 2 4 4 6 6 3culture and entertainment 2 2 4 4 4 4 4 3industrial 1 2 3 3 4 3 3 3health 1 1 3 3 6 7 5 3education 3 4 6 7 12 16 16 8public housing incl. social housing 1 1 3 7 7 8 7 5transport 1 0 0 1 2 1 5 1mixed 3 3 3 4 4 2 4 3other private 3 3 3 4 4 3 3 3other public 2 2 3 2 3 3 3 2ALL 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 20

Chart 2-10Proportion of practice revenue from main work sectors, by practice size

0 20 40 60 80 100

other public

health/education

mixed/other private

private commercial

private housing

50+

20-<50

10-<20

5-<10

3-<5

2

1

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: nu

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per cent average (mean) per cent of practice revenueSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

one-off new house, extension, conversion, alteration

50 48 45 51 42 27 40 42 30 32 25 42 29 27

other private housing 15 12 16 11 15 14 12 15 11 16 11 9 8 8offices 3 6 3 3 7 5 5 3 7 5 6 4 9 6retail 3 2 3 4 4 3 7 5 5 8 7 6 5 8sport and leisure 3 3 3 3 3 3 3 2 5 3 5 3 8 7culture and entertainment 3 4 3 3 4 5 3 3 3 2 5 2 4 3industrial 2 4 3 2 1 4 7 3 4 7 4 4 8 6health 3 4 3 3 2 9 3 4 4 5 5 4 6 5education 7 10 9 8 6 12 9 9 10 8 9 8 9 10public housing incl. social housing

4 2 5 4 4 10 5 6 7 4 11 8 5 8

transport 0 0 0 1 1 0 0 0 1 1 0 1 1 3mixed 2 3 3 3 4 3 2 3 5 3 5 4 5 4other private 2 2 3 3 3 3 2 3 5 3 5 4 5 4other public 2 2 2 2 2 3 2 2 5 3 5 2 3 0ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 21

2.7 Revenue by type of clientChart 2-11Source of practice revenue - client type

othersother public

local/centralgovernment

limited / PLC

contractor

developer

individual

Table 2-6Average practice revenue, analysed by type of client

per cent average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

individual (eg house owner) 69 63 51 37 26 10 2 41property developer 12 14 16 22 21 23 25 19contractor 2 4 4 7 11 16 21 7Limited Company (Ltd) 6 7 9 12 11 15 15 10Corporation (PLC) 1 0 2 3 6 9 10 3central government 0 1 0 1 3 3 4 1local government 1 1 3 4 5 8 6 4other public body 2 2 5 5 8 8 9 5not for profit 4 4 6 6 6 5 4 5other 2 3 3 3 4 3 4 3ALL 100 100 100 100 100 100 100 100

Private individuals emerge as being the most important clients in terms of revenue, accounting for 41 per cent of the profession’s revenue. This proportion is substantially higher for small practices, accounting for over 60 per cent of revenues in 1 or 2 person practices and over 50 per cent in 3 to <5 practices. The importance of this group declines rapidly after this, falling to just 2 per cent in 50+ practices. As the importance of private individuals declines for medium and large practices, a more diverse range of clients, including property developers, contractors, limited companies and corporations, takes their place. Property developers are the most important of these, accounting for over 20 per cent of revenues for practices with 5 or more staff. Local authority clients account for over 5 per cent of revenues of practices with 10 or more staff; other public bodies account for at least 8 per cent of the revenues of practices with 10 or more staff. Central government only represents about 3 per cent of revenues for these same sized practices.

per cent average (mean) per cent of practice revenueSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

individual (eg house owner) 51 49 47 50 42 28 41 43 33 32 27 44 29 26property developer 17 16 16 17 22 20 15 18 17 16 17 12 12 12contractor 7 6 7 6 6 11 10 8 9 11 13 14 9 7Limited Company (Ltd) 7 9 10 8 9 13 15 9 12 13 14 9 16 15Corporation (PLC) 2 1 2 3 4 5 4 2 4 8 2 3 4 4central government 1 0 1 1 1 2 0 1 3 1 0 1 4 9local government 4 4 4 5 3 5 4 3 4 3 6 5 6 7other public body 3 5 5 2 4 7 5 6 8 7 7 6 10 11not for profit 4 7 4 5 4 8 2 8 6 6 9 4 4 5other 3 3 4 3 3 3 3 2 4 2 4 2 5 2ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 22

2.8 Revenue by type of service

per cent average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

BUILDING DESIGNFull Service, RIBA Work Stages 1 to 6 or more 48 48 52 50 48 49 45 49

RIBA Plan of Work Stages 1 – 3 only 32 32 24 24 22 20 21 25RIBA Plan of Work Stages 4 – 6 only 6 7 8 9 10 12 12 9ALL BUILDING DESIGN 87 87 85 82 80 81 78 83

CONSULTANCY project management / contract management

1 2 2 2 3 1 1 2

landscape design 0 0 0 0 1 1 2 0interior design 1 1 2 3 3 4 5 2feasibility studies 3 3 4 4 4 4 4 4urban design / spatial planning 0 0 1 1 1 1 2 1master planning 0 0 1 1 2 3 4 1conservation work 2 2 2 3 2 2 1 2certification work 0 0 1 0 0 0 0 0property valuations 0 0 0 0 0 0 0 0Client Adviser Services 1 1 1 0 1 1 1 1post occupancy services 0 0 0 0 0 0 0 0other or other partial services not included above

3 3 2 2 2 3 3 3

ALL CONSULTANCY 13 13 15 17 20 19 22 17

ALL 100 100 100 100 100 100 100 100

Table 2-7Average practice revenue, analysed by type of service

About half (49 per cent) of practice revenue is derived from offering a ‘full service’ to clients. This corresponds with RIBA Plan of Work 2013 Stages 1-6. Moreover, this proportion is almost the same for every practice size, ranging from between 45 per cent for the largest practices (50 or more staff) to 52 per cent for size group 3 to <5 staff; a very consistent proportion across all practices sizes.

One quarter (25 per cent) of practice revenues come from offering services at Stages 1 to 3 only, while much less, 9 per cent, of the average practice’s revenue comes from offering RIBA Plan of Work Stages 4 to 6 only.

While the proportion of practice revenues coming from RIBA Plan of Work Stages 1 to 3 only declines with practice size (32 per cent of revenue in practices with 1 or 2 staff compared with 21 per cent in practices with 50 or more staff), the opposite is the case for the proportion of practice revenue derived from RIBA Plan of Work Stages 4 to 6 only (12 per cent in practices with 20 or more staff compared with 6 per cent in 1 person practices). Very small proportions (less than 5 per cent) of practice revenue are derived from any one of the consultancy services; these are detailed in Table 2-7.

RIBA Business Benchmarking - 2015 Report Page 23

Profits 3On average, architectural practices report profits that are 18 per cent of total revenues. However, this ‘global’ figure on its own is quite unrepresentative, as the ‘profits as a per cent of revenue’ figure varies very widely between practice sizes; ranging between about 50 per cent for 1 or 2 person practices, to 25 per cent in 10 to <20 staff practices, to a low of 12 per cent in the largest (50+ staff) practices. The variation in this statistic is perhaps greater than for any other figure reported in this survey. The reason for this is primarily due to the way in which Partners, Directors and Sole Principals pay themselves; pay is very often included as profits and will be a far more significant proportion of the profit for smaller practices than larger ones.

The trend data (chart 3-1) suggests that the average profits as a per cent of revenues have fallen this year; this may be because more staff have been recruited and the pay bill has increased. By contrast, the average profits as a per cent of revenue for small practices have increased this year.

Ninety two per cent of practices report a profit in the last financial year; just 8 per cent report zero profit or a loss. A quarter, 25 per cent, report their profit represents less than 20 per cent of practice revenue. Forty three per cent report practice profits of between 20 and 49.9 per cent of their revenue; while 24 per cent report profits of 50 per cent, or more, of their revenue.

In one or two person practices, average profits represent about 50 per cent of revenue. This falls to 30 per cent for a practice of size 5 to <10 staff, and continues to fall to reach 21 per cent for a practice of between 20 and <50 staff. The profit as a per cent of revenue figure is 12 per cent for the largest practices, with 50 or more staff.

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Chart 3-1Profits as a per cent of revenue, selected practice sizes: Trends 2012 to 2015

Source of back data: previous RIBA Business Benchmarking surveys, 2011/12 to 2013/14. A different method is used to calculate profit as a per cent of revenue so figures for past years may not match with those reported previously.

3.1 Profits by size of practice

Chart 3-2Profits as a per cent of revenue, by practice size

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RIBA Business Benchmarking - 2015 Report Page 24

The majority of practices who report profits of 50 per cent and over are in the smaller sizes, including 51 per cent of 1 and 2 person practices, 28 per cent of practices with between 3 and <5 staff, falling to 14 per cent of practices with 5 to <10 staff. About half of 20 to <50 person practices report profits of between 10 and 29.9 per cent of revenue; while about three quarters of practices with 50 or more staff report profits of under 20 per cent of revenue.

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Chart 3-3Average profit per practice

Table 3-2Average practice profits

£ per practice average practice profits1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

MEAN average 21,741 35,304 53,996 95,367 199,196 414,977 1,451,281 185,760

lower quartile 5,000 11,896 18,000 30,000 79,128 190,606 461,890 20,539

MEDIAN average 17,115 26,985 40,417 73,000 161,119 357,537 737,993 59,136

upper quartile 31,856 50,053 72,065 124,575 280,388 582,567 1,523,323 155,741

average (MEAN) profit as aper cent of practice revenue

50 47 36 30 25 21 12 18

Table 3-1Average practice profits as a percent of revenue

per cent average (mean) practice profits per cent of revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

average (MEAN) profit as per cent of revenue 50 47 36 30 25 21 12 18

0% or loss 12 9 8 7 6 4 3 8between 0.1 and 9.9 per cent 4 5 7 10 14 16 33 10between 10 and 19.9 per cent 6 5 12 15 22 26 37 15between 20 and 29.9 per cent 9 12 15 24 21 23 14 18between 30 and 39.9 per cent 5 7 15 17 19 18 9 14between 40 and 49.9 per cent 12 11 15 12 7 8 3 11between 50 and 59.9 per cent 9 15 10 8 5 3 2 8between 60 and 69.9 per cent 15 15 10 3 3 1 0 7between 70 and 79.9 per cent 16 12 5 2 0 1 0 580 per cent + 11 9 3 1 2 0 0 4ALL 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 25

3.2 Profits per head by size of practiceav

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pro

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100000

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Chart 3-4Average profit per Partner, Director, Sole Principal

Table 3-3Average practice profits per Head

£ per head average (mean) practice profits1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

per Partner/Director/Sole Principal 21,426 25,166 37,442 54,309 91,893 130,154 158,009 61,021

per Architect 21,397 23,318 27,305 29,518 32,352 33,720 26,393 27,807

per Architectural Staff 21,379 20,630 19,202 16,966 18,218 18,874 15,120 18,726

per Fee earning Staff 21,363 20,240 18,228 15,906 16,888 16,539 12,884 17,697

While average practice profits per Principal clearly rise in line with practice size, average profits per head of all Architectural staff, and per head of all fee earning staff, do not. The largest practices (50 staff or more) report average profits per head of all fee earning staff of £13,000; compared with between £16,500 and £17,000 in practices in the next two sizes down (between 10 and <50 staff). Average profits per head of all fee earning staff are highest in the very smallest practices, with fewer than five staff.

Chart 3-5Average profit per All fee-earning staff

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RIBA Business Benchmarking - 2015 Report Page 26

3.3 Dividendsav

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Chart 3-6Average dividends paid per practice

Table 3-4Average Dividends paid

£ / per cent average (mean) dividend1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

dividend paid to Directors 10,813 16,356 22,914 40,829 79,403 145,721 168,781 51,569

dividend paid to shareholders 20 689 753 2,168 6,258 12,696 99,389 7,910

average dividend per Principal 10,813 11,074 15,224 23,597 39,535 54,333 52,265 25,258

average dividend as per cent of profit 38 120 56 51 59 40 14 57

Chartered Practices paid £124 million worth of dividends in the last financial year. The majority of these declared dividends, 87 per cent, are paid to Partners, Directors and Sole Principals - the owners of the practices.

But 13 per cent are paid to other shareholders; including 37 per cent of dividends paid by practices with 50 or more staff.

shar

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50+20-<5010-<205-<103-<521practice size: number of staff

Chart 3-7To whom dividends are paid

The table below shows the amount of dividends paid per practice, and how this equates per Principal.

The average dividend paid as a percentage of revenue is generally between about 40 and 60 per cent, although this is lower for large practices (50 plus staff, for whom the figure is 14 per cent).

RIBA Business Benchmarking - 2015 Report Page 27

3.4 Profits by regionChartered Practices in London account for 51 per cent of all profits made by practices throughout the country. The share of profits is slightly lower than the capital’s share of total revenue, which is 56 per cent.

Architectural practices report the highest profits, as a percentage of their revenues, in Northern Ireland, the East of England, the West Midlands and Wessex. In these regions, profits are at least 25 per cent of revenue. The lowest figures are reported by practices in London, the East Midlands and Wales – where profits are 16 per cent or less of revenue. The high number of large practices – whose profits as a percent of revenue are lower than medium and small practices - in London and the East Midlands, will have influenced figures in these regions.

Chart 3-8Average practice profits analysed by region

Table 3-5Average practice profits analysed by region

25% and more

less than 17%

17% to 19.9%

20% to 24.9%

avearge profits as per cent of revenue

£ / per cent regionSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

average (mean) profit per practice, £000 113 85 181 131 265 154 160 112 167 153 122 134 198 147

average profit per Partner/Director/Sole Principal, £000 46 48 57 52 76 56 63 51 59 51 46 40 56 53

average (mean) profit as a per cent of revenue

21 25 19 18 16 25 14 28 19 16 21 14 23 28

per cent of total practice profits

4 2 6 8 51 4 3 4 7 4 1 2 2 2

RIBA Business Benchmarking - 2015 Report Page 28

Expenditure 4Chart 4-1Main source of expenditure

other

travel

IT. Marketing,financial, legal

premises

personnel

On average, 81 per cent of practice revenues are spent on expenses. The largest component of practice expenditure, on average, is expenditure on personnel, accounting for 57 per cent of total practice expenditure, or 45 per cent of practice revenue. The expenditure figures are broken down in detail on the following pages.

4.1 Expenditure by size of practice

per c

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ture

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other expendituresalaries

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 4-2Main expenditure by size of practice

Table 4-1Average practice expenditure

£ / per cent average (mean) per practice1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

ALL expenditure, £ 20,672 37,266 98,266 220,843 576,630 1,582,346 10,277,540 857,789

expenditure as per cent of revenue 48 50 65 69 74 78 87 81

average expenditure per Partner/Director/Sole Principal £

20,580 28,633 73,637 137,524 300,794 601,480 2,106,854 266,862

ALL expenditure EXCLUDING salaries £ 13,025 20,110 42,108 81,738 223,529 601,291 4,183,729 343,370

ALL expenditure EXCLUDING salaries as a per cent of revenue 30 55 45 38 38 38 44 41

Note: £ values for individual elements of expenditure, and percentage of revenue calculated from these, may not precisely match with subsequent tables due to slight variations in the way respondents were asked to source expenditure data

Expenditure as a proportion of revenue rises, as practices get larger. However, if we exclude expenditure on salaries from the figures, then expenditure as a percentage of practice revenues becomes much more even across the practice sizes – in the range of between 38 and 45 per cent across all but the very smallest (one and two person) practices.

RIBA Business Benchmarking - 2015 Report Page 29

44.1 Expenditure by size of practice

4.2 Personnel

Table 4-2Average practice expenditure on personnel

£ average (mean) practice expenditure1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

salaries of fee-earning staff 6,883 14,101 43,746 117,860 318,149 877,805 4,563,123 409,868

salaries of IT staff 9 409 345 692 2,396 8,007 107,713 7,130

salaries of marketing / PR staff 43 51 103 712 3,821 12,630 84,307 6,411

salaries of other staff 950 2,055 6,429 13,138 34,063 90,294 586,202 49,353

ALL 7,884 16,616 50,622 132,403 358,429 988,736 5,341,344 472,761

per cent of all expenditure 38 45 55 62 62 62 56 57

per cent of total revenue 18 22 33 41 46 49 45 45

4.3 Premises

Table 4-3Average practice expenditure on premises

£ / per cent average (mean) practice expenditure1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

rent / mortgage repayments 1,804 3,137 8,008 17,818 35,191 82,944 495,889 45,777

utilities 816 1,101 2,021 4,295 9,702 21,535 88,027 9,784

ALL 2,620 4,239 10,029 22,113 44,894 04,480 583,916 55,561

per cent of all expenditure 3 12 11 10 8 7 6 7

per cent of total revenue 6 6 7 7 6 5 5 5

For practices with 5 staff or more, expenditure on personnel represents between 41 and 49 per cent of practice revenue. In two person practices it is 22 per cent and 33 per cent in 3 to <5 person practices. The very largest practices spend 45 per cent of their total revenue on staff salaries. Average expenditure per practice on the salaries of IT, marketing and PR staff only becomes significant for the largest practices; which spend an average of £108,000 per practice on IT staff and £84,000 on marketing and PR staff.

Expenditure on premises takes up an average of 5 per cent of total practice revenue, ranging between 5 and 7 per cent for all practice sizes. It represents a slightly higher share of revenue for practices of between 3 and <10 staff. In financial terms the average 3 to <5 person practice spends about £10,000 per year on premises, but this rises rapidly with practice size to reach over £500,000 in the largest practices. Expenditure on utilities is about one fifth of expenditure on rent for all but the smallest practices.

salariesother staffsalaries

marketing staffsalaries IT staff

salariesfee-earning staff

Chart 4-3Share of expenditure: personnel

utilities

rent /mortgage

Chart 4-4Share of expenditure: premises

RIBA Business Benchmarking - 2015 Report Page 30

4.4 IT, Marketing, Financial, Legal

Table 4-4Average practice expenditure on IT, Marketing, Financial, Legal

£ / per cent average (mean) practice expenditure1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

IT 740 912 2,000 4,782 12,952 41,906 269,355 21,748

marketing 637 561 1,625 2,494 6,750 18,241 113,059 9,763

legal 130 356 605 1,340 4,056 9,106 56,840 4,970

financial 588 843 1,710 3,387 7,475 13,825 53,689 6,578

bank, interest 175 380 691 1,262 3,163 6,240 171,897 10,766

ALL 2,269 3,052 6,631 13,266 34,395 89,317 664,840 53,825

per cent of all expenditure 2 8 7 6 6 6 7 7

per cent of total revenue 5 4 4 4 4 4 6 5

Table 4-5Average practice expenditure on travel

£ / per cent average (mean) practice expenditure1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

travel 932 1,358 2,461 4,547 9,955 25,979 207,989 16,833

motor 1,267 1,697 2,391 3,833 6,843 13,380 29,849 5,608

ALL 2,198 3,055 4,852 8,380 16,798 39,360 237,838 22,440

per cent of all expenditure 2 8 5 4 3 2 2 3

per cent of total revenue 5 4 3 3 2 2 2 2

4.5 Travel

Expenditure on these items collectively accounts for between 4 and 5 per cent of practice revenue in practices with under 50 staff; and 6 per cent in practices with 50 or more staff. Average money spent per practice increases with practice size for all individual elements, although there are some differences in spending – for example, practices with 50 or more staff spend considerably more on bank and interest charges than smaller practices.

Expenditure on motor and travel falls in line with practice size and represents between 2 and 3 per cent of total revenue in practices with three or more staff.

bank/interest

financial

legal marketing

IT

Chart 4-5Share of expenditure: IT, marketing, financial, legal

motor

travel

Chart 4-6Share of expenditure: travel

RIBA Business Benchmarking - 2015 Report Page 31

4.6 Other Expenditure

Table 4-6Average practice expenditure on other items

£ / per cent average (mean) practice expenditure1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

Professional Indemnity Insurance 784 1,107 2,127 4,428 9,669 22,178 130,328 12,154

insurance - all others except PII 259 395 986 1,851 3,919 9,507 47,151 4,687

capital equipment 597 980 1,825 4,045 10,406 24,618 134,156 12,483

research and development 165 203 406 1,114 2,462 6,772 58,643 4,515

other 4,132 7,079 15,253 26,541 100,987 305,060 2,326,856 177,706

ALL 5,937 9,764 20,596 37,979 127,442 368,134 2,697,135 211,544

per cent of all expenditure 6 27 22 18 22 23 28 26

per cent of total revenue 14 13 14 12 16 18 23 20

Professional Indemnity Insurance is a significant element of expenditure, accounting on its own for about 1 per cent of revenue. Expenditure on research and development only really becomes significant for the largest practices. The full cost of expenditure on capital equipment is included here (although it may be treated differently in accounting procedures); average spending is very low for smaller practices. ‘Other’ items of expenditure is a catch-all term and is used to describe any other items not listed above.

other

research &development

capitalequipment

insuranceexcept PII

PII

Chart 4-7Share of expenditure: other

£ / per cent average (mean) practice expenditureSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

average expenditure per Partner/Director/Sole Principal, £000

171 129 380 197 369 194 393 140 167 173 204 368 213 176

per cent of expenditure on:

personnel 67 60 64 60 55 64 57 67 62 56 60 60 65 54

premises 6 8 6 7 7 8 5 7 7 6 6 7 8 8

IT, marketing, financial, legal 4 5 6 6 5 6 5 6 4 5 7 4 6 4

travel 3 2 3 3 2 4 4 3 2 4 7 4 3 4other 19 25 21 25 30 19 30 18 24 30 21 25 18 30ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

Table 4-7Average practice expenditure analysed by region

RIBA Business Benchmarking - 2015 Report Page 32

Salaries 5

Table 5-1Average Salaries - All Staff

Chart 5-1Average salaries

£ lower quartile

MEDIAN upper quartile

Partner / Director / Sole Principal 25,537 42,000 72,499Salaried Partners & Directors 45,000 55,000 75,000Associates 37,500 43,550 50,000Architects 5+ years ARB registered 34,154 38,000 43,085Architects <5 years ARB registered 29,000 32,000 35,000Technologists 25,420 30,000 35,000Architectural Assistants (Part 2) 23,450 26,000 30,000Architectural Assistants (Part 1) 17,062 20,000 22,500other Chartered construction professionals 30,000 35,000 42,000other fee-earning staff 20,000 27,300 35,000office management / support & admin 16,000 22,000 29,000

Average salaries are this year presented as median averages, including upper and lower quartiles; this is a change from previous survey reports. All figures are full-time equivalent average salaries.

The average earnings of Partners, Directors and Sole Principals is a combination of salary plus profit share or share of dividends – reporting the salary alone would be unrepresentative of the overall ‘earnings’. A majority of practices (56 per cent) pay Partners and Directors a combination of both a salary and dividends; 10 per cent pay dividends only while 30 per cent pay a salary only. The average (median) earnings of Partners, Directors and Sole Principals is £42,000, although the spread of earnings is wide – wider than any other staffing group. The upper and lower quartile figures demonstrate this spread, as one quarter of Principals earn less than £25,500 while another quarter earn £72,500 or more.

The tables and charts on the following pages examine earnings for each staff group in more detail; so for Principals, for example, the average earnings rise by practice size in very distinct ‘steps’. Average earnings for a Partner or Director roughly doubles between a one person practice (£22,100)

0 10000 20000 30000 40000 50000 60000

office management / support & admin

other fee-earning

other Chartered

Arch Assistants (Part 1)

Arch Assistants (Part 2)

Technologists

Architects <5 years

Architects 5+ years

Associates

Salaried Partners / Directors

Partner / Director /Sole Principal

average salary, £

RIBA Business Benchmarking - 2015 Report Page 33

5

Survey notes:

1. Chartered Practices were asked to provide data on the ‘average’ salary paid to each type of staff. Respondents calculated the ‘average’ themselves; we asked that this should ideally be the median average.

2. We asked for the basic salary, excluding overtime. This is the salary received by the employee, before tax and National Insurance are deducted but excluding Employer’s National Insurance costs.

3. Basic salary was the salary being paid on 1 May 2015. The salary included profit share, where given, and if included it was the average profit share across the year. Bonus payments are not be included.

4. Partners, Directors and Sole Principals are treated differently. Their salary is combined with Partners’ share of profits, and Directors’ dividends.

5. All salaries have been converted by respondents to full-time equivalent. Salaries, dividends or profits shares and fringe benefits for partners and directors are an approximation of the totals paid in the 12 months to 1 May 2015.

6. Average earnings are reported here as ‘median’ averages, as distinct from ‘mean’ averages. This follows the approach we have used in the RIBA / The Fees Bureau Architects’ Earnings Survey – the median average is virtually unaffected by the presence of any unusually high, or low values.

rise more rapidly than any staff group other than Partners and Directors; with a distinct difference in the average pay between every size group - ranging from an average of £7,700 in 2 person practices to £30,000 in practices with 50 or more staff.

Chartered Practices pay higher salaries in London than elsewhere, for all staff groups except one – Partners, Directors and Sole Principals. Here, the highest average pay is paid by practices in the East Midlands (£50,000), followed by those in London (£49,100), the South (£45,078) and Scotland (£45,000). For most other staff groups, average salaries are highest in London, followed by the South and South East, then falling with distance from the capital. Chart 5-3 shows average salaries by region for Architects with 5 or more years’ experience, as an example of the pattern, which is typical for most staff salaries other than those of Principals.

and a 5 to <10 person practice (£42,500); then doubles again to £90,000 in a 20 to <50 person practice.

The pattern of salaries increasing in line with practice size continues for other staff categories, but becomes more muted as staff become less senior. So, Associates’ average salaries in a 20 to <50 person practice are 18 per cent higher than those in a 5 to <10 person practice; for Architects with five years or more experience post ARB it is 11 per cent higher; compared with 6 percent higher for Architects <5 years ARB, 7 per cent higher for Part 2 Assistants and 3 per cent for Part 1 Assistants.

There are two exceptions to this trend; the average salary paid to Technologists rises by 13 per cent between those two size groups although salaries peak for the 20 to <50 size, who pay more on average than practices in the 50 plus size group. Second, office management and admin staff salaries

Chart 5-2Average earnings (salaries + dividends) paid to Partners, Directors and Sole Principals, analysed by region

Chart 5-3Average salaries paid to Architects with 5 or more years’ experience, analysed by region

£50,000 and over

under £40,000

£40,000 to £44,999

£45,000 to £49,999

average earnings:Partners, Directors, Sole Principals

£40,000 and over

under £36,000

£36,000 to £39,999

not available

average salary: Architects 5+ ARB

RIBA Business Benchmarking - 2015 Report Page 34

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5.1 Salaries & Dividend Earnings: Partners, Directors, Sole Principals

Table 5-2Average Salaries - Equity Partners, Shareholding Directors or Sole Principals

Table 5-3Average Salaries - Equity Partners, Shareholding Directors or Sole Principals, analysed by region

£ lower quartile

MEDIAN upper quartile

1 11,808 22,106 36,0002 14,000 26,000 39,1433 to <5 22,000 34,030 46,8155 to <10 32,958 42,500 64,96710 to <20 45,039 65,000 95,95120 to <50 64,839 90,000 150,00050 + 96,399 132,560 212,230ALL 25,537 42,000 72,499

£ lower quartile

MEDIAN upper quartile

South West 23,819 40,000 63,104Wessex 25,870 38,000 50,724South 33,214 45,078 71,343South East 22,000 40,000 60,000London 27,572 49,100 89,882West Midlands 28,500 39,912 67,500East Midlands 46,000 50,000 62,000East 29,743 42,650 72,750North West 24,019 40,000 59,852Yorkshire 24,445 38,025 65,000North East 24,000 40,000 64,926Wales 20,250 38,616 50,599Scotland 33,126 45,000 77,500Northern Ireland 18,000 33,000 71,000

Table 5-4Receipt of salary or dividends - Equity Partners, Shareholding Directors or Sole Principals

per cent receive salary only

receive dividends

only

receive BOTH

salary anddividends

1 53 11 362 41 15 443 to <5 40 7 545 to <10 31 8 6110 to <20 25 9 6620 to <50 23 9 6850 + 23 12 65ALL 35 10 56

Chart 5-4Average Salaries - Equity Partners, Shareholding Directors or Sole Principals analysed by size of practice

RIBA Business Benchmarking - 2015 Report Page 35

Table 5-5Average Salaries - Salaried Partners & Directors (without equity or shareholding)

Table 5-6Average Salaries - Salaried Partners & Directors (without equity or shareholding), analysed by region

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 n/a n/a n/a5 to <10 28,253 40,000 50,00010 to <20 40,000 50,000 64,33320 to <50 49,000 57,000 65,00050 + 60,000 75,000 88,231ALL 45,000 55,000 75,000

£ lower quartile

MEDIAN upper quartile

South West n/a n/a n/aWessex n/a n/a n/aSouth n/a n/a n/aSouth East n/a n/a n/aLondon 52,125 66,421 85,694West Midlands n/a n/a n/aEast Midlands n/a n/a n/aEast n/a n/a n/aNorth West n/a n/a n/aYorkshire n/a n/a n/aNorth East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

aver

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Chart 5-5Average Salaries - Salaried Partners & Directors

Note: n/a indicates not enough data for this size or region

5.2 Salaries: Salaried Partners & Directors

n/a

RIBA Business Benchmarking - 2015 Report Page 36

5.3 Salaries: Associates

Table 5-7Average Salaries - Associates, analysed by size of practice

Table 5-8Average Salaries - Associates, analysed by region

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 29,000 34,500 37,9455 to <10 33,000 38,000 45,00010 to <20 38,000 42,000 50,00020 to <50 40,125 45,000 51,17950 + 45,418 50,095 57,000ALL 37,500 43,550 50,000

£ lower quartile

MEDIAN upper quartile

South West 35,000 38,006 43,563Wessex n/a n/a n/aSouth 38,000 42,840 50,000South East 40,000 45,000 50,250London 42,000 48,875 55,000West Midlands 36,375 40,430 51,250East Midlands n/a n/a n/aEast 38,760 42,000 47,500North West 34,950 40,000 44,075Yorkshire 35,245 40,000 45,000North East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

aver

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ry, £

0

10000

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30000

40000

50000

60000

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-6Average Salaries - Associates

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 37

5.4 Salaries: Architects 5+ years ARB registered

Table 5-9Average Salaries - Architects 5+ years ARB, analysed by size of practice

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 30,000 35,000 40,0005 to <10 32,000 36,000 40,00010 to <20 34,500 38,000 42,00020 to <50 35,000 40,000 45,00050 + 38,570 42,000 45,371ALL 34,154 38,000 43,085

£ lower quartile

MEDIAN upper quartile

South West 31,500 35,000 38,600Wessex n/a n/a n/aSouth 36,000 40,000 45,000South East 35,700 40,000 45,112London 37,788 41,000 45,000West Midlands 30,875 36,000 40,000East Midlands n/a n/a n/aEast 33,000 36,205 40,000North West 32,188 35,000 40,000Yorkshire 32,368 35,000 39,500North East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

Table 5-10Average Salaries - Architects 5+ years ARB analysed by region

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Chart 5-7Average Salaries - Architects 5+ years ARB

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 38

5.5 Salaries: Architects <5 years ARB registered

Table 5-11Average Salaries - Architects <5 years ARB analysed by size of practice

Table 5-12Average Salaries - Architects <5 years ARB, analysed by region

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 25,000 28,000 31,0005 to <10 27,500 30,720 34,00010 to <20 29,950 32,088 35,00020 to <50 30,000 32,500 36,00050 + 31,671 35,000 37,155ALL 29,000 32,000 35,000

£ lower quartile

MEDIAN upper quartile

South West 27,000 29,500 30,000Wessex n/a n/a n/aSouth 30,000 34,000 36,000South East 30,000 32,000 35,828London 31,000 34,333 37,000West Midlands n/a n/a n/aEast Midlands n/a n/a n/aEast 29,500 30,000 33,500North West 27,038 29,900 31,942Yorkshire 26,000 30,000 32,000North East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

aver

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ry, £

0

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10000

15000

20000

25000

30000

35000

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Chart 5-8Average Salaries - Architects <5 years ARB

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 39

5.6 Salaries: Technologists

Table 5-13Average Salaries - Technologists, analysed by size of practice

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 18,148 25,000 33,0005 to <10 24,500 29,250 33,50010 to <20 27,000 30,188 36,00020 to <50 28,500 33,000 37,75050 + 29,000 32,125 38,023ALL 25,420 30,000 35,000

£ lower quartile

MEDIAN upper quartile

South West 25,000 28,000 34,918Wessex n/a n/a n/aSouth 29,281 31,025 36,250South East 28,000 32,000 35,404London 30,000 34,800 40,000West Midlands 24,000 28,625 35,000East Midlands 26,000 28,151 33,368East 28,000 32,500 37,150North West 25,000 30,000 33,875Yorkshire 24,500 28,985 32,125North East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

Table 5-14Average Salaries - Technologists, analysed by region

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0

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10000

15000

20000

25000

30000

35000

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-9Average Salaries - Technologists

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 40

5.7 Salaries: Assistants Part 2

Table 5-15Average Salaries - Assistants Part 2 analysed by size of practice

Table 5-16Average Salaries - Assistants Part 2, analysed by region

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 21,680 25,000 29,5005 to <10 22,000 25,250 28,37510 to <20 23,300 26,000 30,00020 to <50 24,000 27,000 29,94250 + 25,000 27,854 30,000ALL 23,450 26,000 30,000

£ lower quartile

MEDIAN upper quartile

South West 21,000 24,000 26,000Wessex n/a n/a n/aSouth 24,000 25,700 28,000South East 24,017 27,500 30,000London 25,769 28,000 30,000West Midlands 20,000 23,950 27,000East Midlands 21,000 24,000 26,600East 23,850 27,000 28,993North West 20,250 24,000 27,000Yorkshire 20,225 22,000 25,000North East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

aver

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ry, £

0

5000

10000

15000

20000

25000

30000

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-10Average Salaries - Assistants Part 2

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 41

5.8 Salaries: Assistants Part 1

Table 5-17Average Salaries - Assistants Part 1 analysed by size of practice

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 15,400 18,000 20,0005 to <10 16,000 19,444 22,00010 to <20 18,000 20,000 24,00020 to <50 18,000 20,000 22,20850 + 19,000 21,000 23,000ALL 17,062 20,000 22,500

£ lower quartile

MEDIAN upper quartile

South West 16,050 18,000 20,000Wessex n/a n/a n/aSouth 18,500 20,000 22,656South East 18,000 20,487 24,125London 20,000 21,000 24,000West Midlands 15,225 17,750 20,146East Midlands 16,500 18,000 21,955East 18,000 19,733 21,750North West 16,000 17,000 18,000Yorkshire 15,000 16,250 18,606North East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

Table 5-18Average Salaries - Assistants Part 1, analysed by region

aver

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ry, £

0

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10000

15000

20000

25000

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-11Average Salaries - Assistants Part 1

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 42

5.9 Salaries: other Chartered professionals

Table 5-19Average Salaries - other Chartered professional staff, analysed by size of practice

Table 5-20Average Salaries - other Chartered professional staff, analysed by region

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 n/a n/a n/a5 to <10 n/a n/a n/a10 to <20 n/a n/a n/a20 to <50 30,000 35,000 41,00050 + 32,750 40,000 45,000ALL 30,000 35,000 42,000

£ lower quartile

MEDIAN upper quartile

South West n/a n/a n/aWessex n/a n/a n/aSouth n/a n/a n/aSouth East n/a n/a n/aLondon 32,570 37,900 45,287West Midlands n/a n/a n/aEast Midlands n/a n/a n/aEast n/a n/a n/aNorth West n/a n/a n/aYorkshire n/a n/a n/aNorth East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

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50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-12Average Salaries - other Chartered professional staff

Note: data not available for small and medium practice sizes

n/a

RIBA Business Benchmarking - 2015 Report Page 43

5.10 Salaries: other fee earning staff

Table 5-21Average Salaries - other fee earning staff, analysed by size of practice

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 n/a n/a n/a3 to <5 n/a n/a n/a5 to <10 18,500 25,000 31,62010 to <20 19,500 26,700 31,00020 to <50 23,063 27,250 35,00050 + 28,375 31,859 36,297ALL 20,000 27,300 35,000

£ lower quartile

MEDIAN upper quartile

South West n/a n/a n/aWessex n/a n/a n/aSouth n/a n/a n/aSouth East n/a n/a n/aLondon 25,000 30,446 37,875West Midlands n/a n/a n/aEast Midlands n/a n/a n/aEast n/a n/a n/aNorth West n/a n/a n/aYorkshire n/a n/a n/aNorth East n/a n/a n/aWales n/a n/a n/aScotland n/a n/a n/aNorthern Ireland n/a n/a n/a

Table 5-22Average Salaries - other fee earning staff, analysed by region

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15000

20000

25000

30000

35000

50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-13Average Salaries - other fee earning staff

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 44

5.11 Salaries: office management, support and admin

Table 5-23Average Salaries - office management, support and admin staff, analysed by size of practice

Table 5-24Average Salaries - office management, support and admin staff, analysed by region

£ lower quartile

MEDIAN upper quartile

1 n/a n/a n/a2 5,252 7,700 11,2333 to <5 8,000 13,000 21,0005 to <10 14,000 19,000 24,00010 to <20 19,000 24,000 30,00020 to <50 22,000 25,936 32,00050 + 25,821 30,000 35,000ALL 16,000 22,000 29,000

£ lower quartile

MEDIAN upper quartile

South West 16,000 20,000 24,000Wessex 15,000 20,000 24,000South 16,575 20,900 26,000South East 14,964 22,135 29,529London 22,500 28,470 34,600West Midlands 15,000 20,000 24,500East Midlands 14,250 19,875 23,500East 13,500 19,000 23,000North West 15,000 20,000 23,087Yorkshire 12,000 18,492 24,390North East n/a n/a n/aWales n/a n/a n/aScotland 16,755 20,000 24,250Northern Ireland n/a n/a n/a

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50+20-<5010-<205-<103-<521practice size: number of staff

Chart 5-14Average Salaries -office management, support and admin staff

Note: n/a indicates not enough data for this size or region

n/a

RIBA Business Benchmarking - 2015 Report Page 45

5.12 Value of Fringe Benefits

£ average (median) value of fringe benefit1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

Partner / Director / Sole Principal 405 678 1,333 2,142 3,906 7,302 11,334 2,765Salaried Partners & Directors n/a n/a n/a 2,330 2,362 2,772 8,489 3,744Associates n/a n/a 971 2,334 2,014 2,339 4,705 2,483Architects 5+ years ARB registered n/a n/a 195 854 646 840 2,383 889Architects <5 years ARB registered n/a n/a 239 558 632 854 1,698 778Technologists n/a n/a 313 564 719 870 1,265 683Architectural Assistants (Part 2) n/a n/a 107 2,250 473 550 1,246 1,071Architectural Assistants (Part 1) n/a n/a 359 320 287 269 983 396other Chartered n/a n/a n/a 237 312 630 2,133 867other fee-earning n/a n/a 706 669 474 753 2,495 967office management / support & admin n/a 478 176 398 403 629 1,569 524

Table 5-25Average value of fringe benefits

The table above shows what practices pay, on average, as fringe benefits in addition to the salary. The figures shown are the average (mean) for all practices - including those who pay zero fringe benefits. Benefits would include, for example, health insurance, life insurance, a pension, company car (BIK value), RIBA or ARB subscription.

The greatest values of fringe benefits are paid to Partners, Directors and Sole Principals. This averages over £2,000 for Partners and Directors in practices with 5 to <10 staff, reaching £7,300 for those in practices with between 20 and <50 staff, rising to an average of over £11,300 in the largest practices.

In general, the value of fringe benefits increases inline with practice size. Senior staff receive average benefits of £1,000 or more. The largest practices (size 50 plus) pay average benefits of £1,000 or more to virtually all staff categories.

RIBA Business Benchmarking - 2015 Report Page 46

6.1 Business Plans

Business Policies 6Chart 6-1Time period covered by practice business plans

5 years or more

4 years

3 years

2 years

1 year

7-11 months

up to 6 months

Table 6-1Length of time covered by Business Plans

per cent period of time covered by business plan1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

up to 6 months 19 17 16 11 7 1 2 117-11 months 2 4 3 3 1 2 0 21 year 36 38 41 36 25 23 28 332 years 12 15 12 15 15 11 11 143 years 13 12 14 15 24 33 30 194 years 2 2 2 1 2 4 3 25 years or more 16 12 13 19 26 25 26 19ALL 100 100 100 100 100 100 100 100

Most, 87 per cent practices, have a Business Plan which covers at least a year; this includes 19 per cent who have a Plan which extends to 5 years or longer. The smallest practices are most likely to have a Plan which covers the shortest time period; 21 per cent of one and two person practices’ Plans extend to less than 12 months. But even 8 per cent of practices with between 10 and <20 staff have a Plan which does not even cover a year. At least one quarter of practices with 10 staff or more have a Plan extending 5 years or beyond.

per cent period of time covered by business planSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

up to 6 months 13 17 11 13 9 9 12 11 11 12 16 6 11 197-11 months 1 2 1 4 2 0 2 5 2 1 3 0 0 41 year 30 37 36 32 35 35 27 28 26 34 25 40 36 442 years 13 10 9 13 14 14 13 19 13 12 13 9 25 113 years 24 24 16 14 18 23 21 11 28 17 34 17 21 74 years 4 0 4 4 2 0 0 3 3 0 0 0 0 45 years or more 14 10 23 21 20 20 25 22 17 25 9 29 7 11ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 47

66.2 Cashflow & Budgets

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Chart 6-2Proportion of practices with a cashflow forecast, by practice size

Table 6-2How many practices prepare cashflow forecasts and set budgets

per cent whether practice prepares forecasts and budgets1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

YES - have a cashflow forecast 48 64 74 84 93 97 98 78

time period over which the forecast extends:up to 3 months 25 23 25 15 15 5 7 174 - 6 months 30 24 26 26 16 12 13 227-11 months 4 10 9 9 10 10 7 91 year 37 37 31 42 48 55 52 422 years 2 3 5 6 9 14 12 73 years 1 1 3 1 2 3 4 24 years 0 0 1 0 0 0 0 05 years or more 1 3 0 1 1 1 6 1

average number of debtor days 18.9 21.8 25.7 30.1 36.0 46.8 61.4 30.7

set annual budget - income 35 46 57 67 76 88 96 63set annual budget - expenditure 37 45 54 65 75 85 93 61

Most, 78 per cent, of practices have a cashflow forecast including over 90 per cent of practices with 10 or more staff. The majority extend up to one year; only 10 per cent (including 22 per cent of the largest practices) have a cashflow forecast which goes beyond one year.

A little over 60 per cent of practices set annual budgets for income (63 per cent) or expenditure (61 per cent). The likelihood of having a budget increases in line with practice size, from under half of one and 2 person practices to over three quarters of those with 10 or more staff.

Practices allow clients an average of 31 days in which to pay their invoices (termed ‘debtor days’). But this average figure varies considerably by practice size, ranging from about 20 days by 1 or 2 person practices, to more than 60 days by the largest practices.

RIBA Business Benchmarking - 2015 Report Page 48

6.3 Time Tracking

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Chart 6-3How many practices require Associates, Architects 5+ and Architects <5 to complete timesheets (average)

Table 6-3How many practices require staff to complete timesheets

per cent whether practice requires staff to complete timesheets1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

Partners, Directors, Sole Principals 62 67 62 66 64 66 79 65Salaried Partners & Directors 0 70 54 80 84 85 93 82Associates 0 50 76 86 88 91 100 89Architects 5+ years 50 83 80 87 91 93 100 90Architects <5 years 0 89 81 89 93 95 100 92Technologists 25 74 82 83 92 95 100 89Architectural Assistants Pt 2 100 74 76 86 90 95 100 89Architectural Assistants Pt 1 100 88 76 85 90 94 100 89other Chartered 0 67 67 78 87 87 97 86other fee-earning 50 62 77 83 83 94 100 87office management staff 50 30 30 33 33 35 73 37

practice records time spent on non-chargable hours 46 52 58 69 81 87 99 66

A majority of practices require their staff to complete timesheets. The requirement increases in line with practice size, so while about 80 per cent of Architects in practices of size 3 to <5 staff are required to complete timesheets, this rises to over 90 per cent in practice size 10 or more; and to 100 per cent in practices of 50 or more. The largest practices (50 plus) are the most consistent in their approach to the completion of timesheets, with 100 per cent requiring all fee earning staff to do so (with one exception – 97 per cent require Other Chartered staff to complete timesheets). Seventy three per cent of these practices also require their office management staff to complete timesheets, compared with between 30 and 35 per cent of practices with between 2 and <50 staff.

RIBA Business Benchmarking - 2015 Report Page 49

6.4 Job Descriptions, Employment Policies

Chart 6-4Proportion of practices with job descriptions, by size

Table 6-4How many practices have job descriptions for their staff

per cent whether practice has a job description for staff1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

job description: all Partners/Directors 49 52 56 60 59 66 63 57job description: all other fee earners 27 45 75 87 86 88 83 70job description: all non fee earners 22 35 59 79 84 90 85 63

Table 6-5How many practices have a formal CPD programme and employ students

per cent whether practice has formal CPD or employs students 1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

formal CPD programme 61 65 65 80 93 93 95 77employ architecture students 5 15 39 65 83 90 97 52... of those who employ students, use the RIBA Model Student Contract

47 38 32 30 17 14 9 23

Having a job description for all staff is by no means universal. Only a little more than half of practices report that all their Partners, Directors and Sole Principals have job descriptions, and this proportion does not change much with practice size. Even in the very largest practices (50 or more staff) , 63 per cent say all their Partners, Directors and Sole Principals have a job description. The number of other fee earners, and non-fee earners with a job description is higher than for Partners, Directors and Sole Principals, and here there is a marked difference in the prevalence of job descriptions between practices with fewer than five staff and those with more. For practices with five staff upwards, about 80 per cent or more have a job description for all their fee earners and non-fee earners; compared with fewer than 50 per cent of two person practices.

More than 90 per cent of practices with 10 or more staff have a formal CPD programme. Over 80 per cent of these same practices employ architecture students. The proportion of smaller practices with formal CPD programmes is lower, but is still no less than 60 per cent in any size group (even one person practices). The employment of architecture students falls away rapidly as practice size declines.

Of those practices who do employ architecture students, a minority uses the RIBA Model Student Contract. Furthermore, use of the RIBA Model Student Contract appears to decline in relation to a practice’s size. Just 9 per cent of large practices (50 or more staff) do so, compared with 30 per cent of practices with between 5 and <10 staff.

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other feeearning staff

Partners, Directors,Sole Principals

50+20-<5010-<205-<103-<521practice size: number of staff

practices with job descriptions for:

RIBA Business Benchmarking - 2015 Report Page 50

6.5 Equality, Diversity & Inclusion

Chart 6-5Proportion of practices with a documented EDI policy

Table 6-6How many practices have policies and strategies relating to Equality, Diversity & Inclusion (EDI)

per cent extent of involvement with Equality, Diversity & Inclusion1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

have documented EDI policy 44 60 71 84 89 97 96 75have strategies in place to promote EDI 19 31 40 51 59 73 77 46

...of those with strategies, practices undertake:

data collection on the protected characteristics as defined in the Equality Act 2010

52 32 35 38 43 58 57 43

EDI training for staff members 48 32 25 33 35 46 49 36recruitment - strategies to address the under-representation of staff with protected characteristics

59 40 52 56 60 64 48 55

talent management - strategies to support staff development / retention 44 54 58 73 79 88 88 72

work/life balance – strategies to support flexible working 79 78 85 85 92 94 94 88

Three quarters (75 per cent) of practices have a documented Policy relating to Equality, Diversity and Inclusion (EDI). This includes nearly all practices with 20 or more staff, and 84 per cent or more of those with between 5 and <20 staff. Fewer, 46 per cent overall and over 70 per cent of practices with 20 or more staff, have strategies in place to promote EDI. The most popular strategies in place are to support flexible working (88 per cent of practices

who have EDI strategies have one to promote the work/life balance); and to support staff development and retention (72 per cent).

The extent of involvement with EDI increases with practice size, although there is little difference between practices with 50 or more staff and practices in the next size group down, 20 to <50 staff.

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RIBA Business Benchmarking - 2015 Report Page 51

7.1 Services

Work Areas 7Chart 7-1Services offered to clients in the last 12 months

Chartered Practices indicated the services which they offered, and received fees from, in the last 12 months. A long list of services was available to select from, these are more specialist or niche services and different from the principal building design services discussed elsewhere. Out of the various services, three were offered by at least half of

per cent practices offering service

consultancy services

0 20 40 60 80 100

structural engineeringexhibition design

building services engineeringproduct designgraphic design

project management - (alone)design & build (alone)

cost estimatingurban planning and design

landscape designsurveying

presentation materialsCDM Principal Designer

space planninginterior designother services

accommodation managementpost occupancy evaluations

building maintenancemaster planning

feasibility servicespre and post project servicesarbitration/dispute resolution

RIBA Client Adviseraccommodation management

funding adviceexpert witness

research servicesclient representation

community consultationadvice on arch services/fees

building maintenanceplanning advice

practices. Seventy eight per cent offered Feasibility services; 63 per cent offered planning advice; and 50 per cent interior design. While feasibility services and interior design were offered by more medium and large practices than small ones, the proportion of practices offering planning advice as a service was similar across all practice sizes.

RIBA Business Benchmarking - 2015 Report Page 52

Table 7-1Services offered to clients in past 12 months: Consultancy Services

per cent practices who offer service1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

arbitration and dispute resolution 3 2 3 4 4 6 7 4client representation 10 13 17 17 28 31 28 19community consultation 6 9 12 24 35 40 43 21expert witness advice and reports 4 6 7 8 18 21 27 11advice on architects’ services & fees 23 23 18 20 28 25 23 22funding advice 4 8 8 12 18 9 9 10planning advice 57 67 63 65 69 59 56 63research services 8 13 11 13 17 13 18 13RIBA Client Adviser 3 3 2 4 6 8 14 5

Table 7-2Services offered to clients in past 12 months: Pre and Post Project Services

per cent practices who offer service1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

building maintenance 19 22 28 28 30 23 18 25accommodation management 3 4 5 4 13 9 14 7feasibility services 55 67 75 85 90 87 95 78master planning 13 21 27 46 67 75 93 43post occupancy evaluations 3 4 5 8 13 17 33 9

Table 7-3Services offered to clients in past 12 months: Other Services

per cent practices who offer service1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

building services engineering 4 8 7 5 10 8 12 7CDM Principal Designer services 18 32 33 36 47 48 50 36cost estimating 18 27 25 28 24 19 14 24design & build - stand alone service 5 9 16 22 27 33 37 19exhibition design 2 2 4 8 6 10 14 6graphic design 4 8 7 12 15 27 52 13interior design 28 38 43 52 63 66 88 50landscape design 17 24 28 31 36 39 50 30presentation materials 15 22 23 36 57 59 60 35product design 4 5 8 8 9 7 17 8project management - stand alone service 5 9 12 16 20 21 23 14

space planning 23 27 35 37 54 55 64 39structural engineering 2 3 3 5 6 8 13 5surveying 34 39 39 36 38 26 15 35urban planning and design 8 12 15 26 39 44 70 25

RIBA Business Benchmarking - 2015 Report Page 53

7.2 Number of Projects

Table 7-4Number of projects worked on

per cent average (mean) number of projects per practice1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

number of projects 16 19 30 42 73 107 265 56

per cent range of size of projects worked on1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

under £250,000 73 65 51 34 23 10 9 42£250,000 to £499,999 14 16 21 21 18 12 5 17£500,000 to £999,999 6 8 13 16 17 15 7 13£1 m to £4.9 m 5 8 12 18 23 28 16 15£5 m to £9.9 m 1 1 2 5 8 14 17 5£10 m to £24.9 m 1 1 1 3 6 10 17 4£25 m to £99.9 m 0 0 1 2 3 8 18 3£100 m plus 0 0 0 1 1 3 10 1ALL 100 100 100 100 100 100 100 100

Table 7-5Size of projects worked on

Chartered Practices are each working on many different projects each year. Over the last 12 months, the average one person practice worked on 16 different projects, rising to an average of 19 for a two person practice. Practices with 3 to <5 staff worked on an average of 30 projects, for 5 to <10 practices it was 42, rising to 73 and 107 for larger practices. The largest firms, with 50 or more staff, worked on an average of 265 projects each.

Although the number of projects worked on increased with practice size, the number of projects worked on does not

rise by the same proportion as the increase in staff. So the average number of projects worked on by say a 10 to <20 staff practice is less than double that of the workload in a practice of half its size (5 to <10 staff). This is most likely to be because larger practices work on larger projects. Table 7-5 shows that as practice size increases, the size of project increases. So while 81 per cent of projects worked on by 2 person practices and 55 per cent, of projects undertaken by a practice with 5 to <10 staff are under £0.5 million, just 22 per cent of projects worked on by practices with 20 to <50 staff are.

per cent range of size of projects worked onSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

under £250,000 42 49 40 48 34 42 50 50 48 47 41 52 43 36£250,000 to £499,999 22 21 22 19 14 20 18 16 16 17 17 17 16 25£500,000 to £999,999 16 11 14 12 12 13 11 13 12 11 14 11 16 14£1 m to £4.9 m 14 10 15 12 18 15 11 12 15 14 17 14 13 16£5 m to £9.9 m 3 2 5 4 7 6 5 4 4 6 7 4 4 4£10 m to £24.9 m 1 2 3 3 6 2 2 2 2 5 3 2 5 4£25 m to £99.9 m 1 2 1 1 5 1 2 1 1 1 0 1 3 2£100 m plus 0 2 0 0 3 1 0 0 0 0 0 0 1 0ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

per cent regionSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

number of projects 62 42 75 60 39 58 94 58 75 71 52 59 79 48

RIBA Business Benchmarking - 2015 Report Page 54

7.3 Number of clientsChart 7-3Comparison of number of Projects and number of Clients

Table 7-6Number of clients

per cent number of clients per practice/Principal1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

average number of clients 13 16 23 29 44 47 105 32

per cent repeat clients 31 34 38 46 50 62 63 44

The average number of clients for whom a practice has worked in the last 12 months rises with practice size – although the pattern shows a notable ‘jump’ at size 10 staff, and another jump at size 50. The average number of clients for practices at size 20 to <50 staff, 47, is similar to the 44 reported by practices of between 10 and <20 staff. While the largest (50 or more staff) practices report more than twice as many clients in the last year: 105 on average.

Also increasing with practice size is the proportion of repeat clients, which ranges from 30 plus per cent for small practices to around 50 per cent at sizes 5 to <20, but then increases further to around 62 per cent for practices with 20 or more staff. This may, of course, merely reflect the fact that smaller practices have more private individual clients who are less likely to commission further works.

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average number, last 12 months:

Chart 7-2Size of projects undertaken analysed by practice size

0 20 40 60 80 100

£100 m plus

£25 m to £99.9 m

£10 m to £24.9 m

£5 m to £9.9 m

£1 m to £4.9 m

£500,000 to £999,999

£250,000 to £499,999

under £250,00050+

20-<50

10-<20

5-<10

3-<5

2

1

per cent projects

project size:

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: nu

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taff

per cent number of clients per practice/PrincipalSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

average number of clients 37 31 45 35 23 34 46 38 36 33 33 37 42 27

per cent repeat clients 36 38 41 38 42 55 48 47 49 53 52 38 51 55

RIBA Business Benchmarking - 2015 Report Page 55

8.1 Bids and Outcomes

New Business 8Chart 8-1Outcome of bids made in last 12 months

not known

unsuccessful

successful

Table 8-1Number of bids made in the last 12 months, and the outcomes of these bids

number / per cent average (mean) number of bids per practice, last 12 months1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

number of projects bid for 17 22 28 36 52 59 123 39

outcome (per cent):successful 62 60 59 56 51 45 37 55unsuccessful 30 32 36 37 40 45 48 37not known 7 7 5 7 9 10 15 8

Practices reported how many projects they had bid for in the last 12 months, and what the outcome of these bids were. A ‘bid’ means the practice has formally sought to offer services for a particular job or to a client. This could be in response to a site visit; or in response to a request for a quotation; or through a competitive process, such as pre-qualification questionnaire, expression of interest, design competition. For small and medium sized practices, with fewer than 10 staff, there is a reasonable correlation between the number of bids made and the number of projects being undertaken over the same time period (comparing Table 8-1 with Table 7-4). For larger practices, the number of bids made is around half the number of projects being worked on.

Practices knew the outcome of most (92 per cent) of the projects for which they had bid. The overall success rate is 55 per cent, although it is higher than this for small practices and falls as practices get larger – reaching a low of 37 per cent success rate for practices with 50 or more staff. For one or two person practices, the success rate is 60 per cent or more; for practices with between 3 and <20 staff it is over 50 per cent; falling to 45 per cent for practices with 20 to <50 staff. Although it should be noted that a larger proportion of those large practices did not yet know the outcome of all of their bids: 15 per cent of the bids made by the largest practices (with 50 or more staff) were yet to hear their outcome.

RIBA Business Benchmarking - 2015 Report Page 56

Chart 8-2Method used on successful bids

Table 8-2How bids were won

Chart 8-3Success rates by region

The most common method in which bids for new work were won is by a direct appointment by the client, with no competitive process. This was the method that secured 56 per cent of successful bids made by practices in the last 12 months. The next most commonly successful method, for 20 per cent of bids, was a competitive bid or financial tender. A Framework Agreement was the method for achieving 6 per cent of successful bids, while 4 per cent were the result of being invited to a competitive interview without any formal pre-qualification.

other

invited

EOI/PQQ

fee bid

frameworkdirect appointment

per cent number of clients per practice/Principal1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

direct appointment with no competitive process 70 65 60 56 44 34 27 55

framework agreement (see note 1) 1 1 2 5 9 16 15 6competitive fee bid or financial tender ONLY 18 20 22 22 22 16 15 20

expression of interest / pre-qualification questionnaire (see note 2)

3 2 4 7 11 18 25 8

invited competitive interview or design competition without pre-qualification

3 4 6 6 8 10 14 6

other appointment process 4 7 6 4 6 5 4 6ALL 100 100 100 100 100 100 100 100

1: may, or may not, include a further competitive hurdle to win specific projects2: may, or may not, be followed by a competitive interview or design competition

60% and over

under 50%

50% to 54.9%

55% to 59.9%

avearge success rate

RIBA Business Benchmarking - 2015 Report Page 57

0 20 40 60 80 100 120

office management / support & admin

other fee-earning

other Chartered

Arch Assistants (Part 1)

Arch Assistants (Part 2)

Technologists

Architects <5 years

Architects 5+ years

Associates

Salaried Partners / Directors

Partner / Director /Sole Principal

average hourly rate, £

Chart 8-5Average hourly charge-out rates by region

Chart 8-4Average hourly charge-out rates used to calculate fees

8.2 Hourly Rates

£100 and over

under £80

£80 to £89

£90 to £99

avearge hourly ratesPartners, Directors, Sole Principals

Average hourly rates refer to the charge-out rates used by practices for calculating fees on projects, and are not necessarily the rates directly charged to clients. For senior staff, such as Partners, Directors and Sole Principals, Associates and Architects, average hourly rates increase with practice size. The average rate for a Partner and Director rises from an average (mean) figure of £85 in a practice with 3 to <5 staff, to £115 in a 10 to <20 practice, to peak at £155 for a practice with 50 or more staff. The corresponding figures for an Associate are £65, £91 and £100; and for more experienced Architects (registered for 5 years or more) the average hourly rates for the same practice sizes are £67, £79 and £80. For more junior staff, the average rates are much more even across the practice sizes.

When analysed by region, average rates for Partners, Directors and Sole Principals are, of course, heavily influenced by practice size, which may explain why average rates in London (£120) are significantly higher than elsewhere. Average rates of £90 or more are recorded in Scotland, the South East and the South. Lowest average hourly rates – of below £80 - are reported by practices in Northern Ireland, Yorkshire and the South West. While the rates of some staff do vary by practice size, those for more junior staff show a much smaller variation – and in every case London records the highest average rates, consistently followed in second place by the South East.

RIBA Business Benchmarking - 2015 Report Page 58

Table 8-3Average Hourly Rates, analysed by Region

£ average (mean) rate per hourSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

equity Partners, shareholder Directors, or Sole Principals 79 81 91 91 120 80 80 84 82 78 83 76 92 72

salaried Partners or non-shareholder Directors n/a n/a n/a 103 127 n/a n/a n/a n/a n/a n/a n/a n/a n/a

Associate Directors or Associates 66 n/a 82 84 105 73 n/a 75 71 71 n/a n/a n/a n/a

Architects (5 years + ARB registered) 64 n/a 74 76 91 60 66 64 66 63 n/a n/a n/a n/a

Architects (<5 years ARB registered) 60 n/a 66 68 76 n/a n/a 64 60 58 n/a n/a n/a n/a

Technologists 51 n/a 60 60 67 56 56 56 56 51 n/a n/a n/a n/aArchitectural Assistants (Part 2) 47 46 54 55 61 51 48 50 49 46 n/a n/a n/a n/a

Architectural Assistants (Part 1) 40 39 46 49 53 43 42 44 42 38 n/a n/a n/a n/a

other Chartered construction professional n/a n/a n/a n/a 65 n/a n/a n/a n/a n/a n/a n/a n/a n/a

other fee earning staff 48 n/a n/a 52 56 n/a n/a 50 39 n/a n/a n/a n/a n/aoffice management / support & admin 11 10 11 18 22 12 10 9 11 8 n/a n/a n/a n/a

£ average (mean) rate per hour1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

equity Partners, shareholder Directors, or Sole Principals 70 76 85 97 115 126 155 96

salaried Partners or non-shareholder Directors n/a n/a n/a 91 101 103 128 103

Associate Directors or Associates n/a n/a 65 78 91 92 100 88Architects (5 years + ARB registered) n/a n/a 67 74 79 78 80 76Architects (<5 years ARB registered) n/a n/a 56 67 74 70 68 69

Technologists n/a n/a 48 55 61 60 63 57Architectural Assistants (Part 2) n/a n/a 54 55 57 57 55 55Architectural Assistants (Part 1) n/a n/a 41 48 49 48 47 47other Chartered constr. professional n/a n/a 59 63 53 63 54 58other fee earning staff n/a n/a 47 48 58 50 53 51office management / support & admin n/a 19 15 13 15 16 15 15

Table 8-4Average Hourly Rates, analysed by Size of Practice

RIBA Business Benchmarking - 2015 Report Page 59

9.1 Offices outside the UK

9InternationalChart 9-1Number of offices outside the UK

Table 9-1Offices outside the UK

Five per cent of practices have offices outside the UK. Only a tiny number - between 1 and 2 per cent - of practices with fewer than 10 staff, have an office outside the UK. Nine per cent of practices with 20 to <50 staff have an office outside the UK, while 37 per cent of practices with 50 or more have at least one.

per cent practice size1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

0 offices 99 99 98 97 96 91 63 951 office 1 1 2 2 2 6 16 32 offices 0 0 0 0 1 1 9 13 offices 0 0 0 0 0 2 2 04 offices 0 0 0 0 0 0 4 05+ offices 0 0 0 0 1 1 7 1ALL 100 100 100 100 100 100 100 100

3 or more2

1

0

per cent regionSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

0 offices 96 100 98 98 92 99 99 99 95 97 98 96 98 921 office 4 0 1 2 4 1 0 1 4 2 2 0 0 82 offices 0 0 0 0 1 0 0 0 1 1 0 0 2 03 offices 0 0 1 0 1 0 0 0 0 0 0 0 0 04 offices 0 0 0 0 1 0 0 0 0 0 0 0 0 05+ offices 0 0 0 0 1 0 1 0 1 0 0 4 0 0ALL 100 100 100 100 100 100 100 100 100 100 100 100 100 100

RIBA Business Benchmarking - 2015 Report Page 60

9.2 Revenue from outside the UK

Table 9-2Average practice revenue from outside the UK

Chartered Practices generated £514 million of revenue from projects based outside the UK. This represents 22 per cent of total revenue. Most practices have very little revenue from outside the UK; no more than 7 per cent for any practice size up to 50 staff. However, for the largest practices, the proportion of revenue from outside the UK leaps to represent 32 per cent of total practice revenue for practices with 50 or more staff. Revenue from outside the UK is very heavily concentrated in the hands of these practices; firms with 50 or more staff generate 90 per cent of all revenue from outside the UK.

Over half of revenue from outside the UK comes from work

Chart 9-2Source of Revenue from outside the UK (continents)Thickness of lines represents the volume of revenue - see legend

£100 million£50 million

per cent / £ practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

average (mean) revenue from outside UK, per cent of all revenue 2 2 5 6 5 7 32 22

average (mean) revenue from outside UK, £ 1,072 1,645 7,573 18,576 39,110 133,621 3,834,999 50,037

per cent with >20 per cent of practice revenue from outside the UK 3 4 5 7 6 8 23 6

ALL practice revenue from outside UK, £ million 0.3 0.5 3 11 13 26 460 514

share of ALL practice revenue from outside UK, per cent 0.1 0.1 1 2 3 5 90 100

in the rest of Europe, and in particular the EU; 43 per cent of revenue from outside the UK comes from the rest of the European Union; another 12 per cent comes from Europe outside the EU. Fourteen per cent of revenue from outside the UK is generated in the Middle East, and almost as much, 13 per cent, from Asia. North America is the source of 7 per cent of revenue from outside the UK.

The volume of work from outside the UK has been growing, both in absolute financial terms and as a proportion of total practice revenues. In 2013, 16 per cent of practice revenues came from outside the UK; the following year it had increased to 20 per cent, and now it is 22 per cent.

RIBA Business Benchmarking - 2015 Report Page 61

Chart 9-5Share of total architectural revenue from outside the UK analysed by geographic source of revenue

Chart 9-4Share of total architectural revenue from outside the UK analysed by practice size

50+

20 to <50

10 to <20

5 to <10

under 5

SouthAmerica

NorthAmerica

Australasia

Middle East

Africa

Asia

Europe excludingEU & UK

EUexcluding UK

per c

ent o

f tot

al p

ract

ice

reve

nues

0

5

10

15

20

25

30

2015201420130

100

200

300

400

500

600

value of practice revenue, £ million

£ m(right hand scale)

per cent(left hand scale)

Chart 9-3Share of total architectural revenue from outside UK:Trends 2013 to 2015

work outside the UKper cent £m value

EU excluding UK 43 221Europe excluding EU 12 62Asia 13 64Africa 6 32Middle East 14 72Australasia 2 11North America 7 37South America 3 14ALL outside UK 100 514

Table 9-3Source of practice revenue from outside the UK

Source of back data: previous RIBA Business Benchmarking surveys, 2012/13 and 2013/14

per cent / £ practice revenueSouth West

Wess-ex

South South East

London West Mids

East Mids

East North West

York-shire

North East

Wales Scot-land

N. Ire-land

average (mean) revenue from outside UK, per cent of all revenue

3 1 3 20 34 1 13 0 6 1 2 9 1 8

average (mean) revenue from outside UK, £000 16 3 25 141 548 6 149 1 56 11 15 86 10 44

per cent with >20 per cent of practice revenue from outside the UK

1 5 2 6 11 1 7 1 4 2 4 0 5 14

ALL practice revenue from outside UK, £ million 2 0 3 34 441 1 13 0 9 1 1 5 0 2

share of ALL practice revenue from outside UK, per cent

0 0 1 7 86 0 2 0 2 0 0 1 0 0

Table 9-2 (continued)Average practice revenue from outside the UK, analysed by region

RIBA Business Benchmarking - 2015 Report Page 62

Table 9-5Average practice revenue from outside the UK, analysed by sector of work

per cent of work outside UK average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

one-off new house, extension, conversion, alteration

48 52 21 22 9 6 0 15

other private housing 3 3 15 10 10 10 4 9 offices 0 6 6 13 4 6 16 10 retail 0 1 2 8 20 21 15 12 sport and leisure 0 0 1 11 3 25 13 9 culture and entertainment 0 0 11 7 10 12 9 9 industrial 0 0 4 0 6 0 1 2 health 25 15 0 0 5 8 1 4 education 13 10 0 2 10 4 5 5 public housing incl. social housing 0 0 1 3 1 1 0 1 transport 0 0 0 5 5 0 12 5 mixed 0 13 7 13 7 3 14 10 other private 11 0 15 4 2 4 6 6 other public 0 0 16 2 8 0 2 5 ALL - all revenue from outside UK 100 100 100 100 100 100 100 100

per cent of work outside UK average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

new build 28 42 38 63 54 66 70 56 refurbishment 36 14 20 18 24 26 10 19 both new build and refurbishment 8 20 18 12 7 4 5 10 conservation 6 24 4 1 3 0 0 3 other 22 1 21 6 12 4 15 11 ALL - all revenue from outside UK 100 100 100 100 100 100 100 100

Table 9-4Average practice revenue from outside the UK, analysed by type of work

The data in Tables 9-2 to 9-6 is presented for all practices sizes, for completeness, but we will focus on the largest practice size (50 plus staff) as this is where most revenues from outside the UK are earned. The large majority of the work undertaken outside the UK relates to new buildings; 70 per cent, plus another 5 per cent that are both new build and refurbishment. Just 10 per cent is refurbishment alone; the rest, 15 per cent, is ‘other’.

Amongst the large practices, the principal sectors which generate revenue from outside the UK are offices (16 per cent of the total), retail (15 per cent), mixed (14 per cent), sport and leisure (13 per cent) and transport (12 per cent). The main types of service offered are Full Service (accounting for 32 per cent of revenue from outside the UK for the largest practices), Work Stages 1-3 (27 per cent) and interior design (12 per cent).

RIBA Business Benchmarking - 2015 Report Page 63

Table 9-6Average practice revenue from outside the UK, analysed by type of client

per cent of work outside UK average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

individual (eg house owner) 44 49 25 25 15 16 2 19 property developer 2 12 38 33 11 21 23 24 contractor 0 0 4 4 8 8 8 6 Limited Company (Ltd) 0 4 9 17 15 19 23 16 Corporation (PLC) 0 0 0 6 7 11 12 7 central government 0 17 13 5 17 11 14 11 local government 0 2 3 6 12 0 2 5 other public body 29 0 6 1 3 11 4 5 not for profit 8 0 0 2 2 2 1 2 other 17 15 2 2 10 0 11 6 ALL - all revenue from outside UK 100 100 100 100 100 100 100 100

per cent of work outside UK average (mean) per cent of practice revenue1 2 3-<5 5-<10 10-<20 20-<50 50 + ALL

BUILDING DESIGNFull Service, RIBA Work Stages 1 to 6 or more 57 52 22 38 23 31 32 33

RIBA Plan of Work Stages 1 – 3 only 19 43 24 33 30 35 27 30RIBA Plan of Work Stages 4 – 6 only 2 0 7 1 11 9 9 6

CONSULTANCY / partial servicesproject management / contract management

0 1 0 2 1 1 0 1

landscape design 0 0 4 0 3 1 1 2interior design 0 0 15 14 16 15 12 13feasibility studies 13 1 3 5 4 2 2 4urban design / spatial planning 0 0 5 1 5 0 3 2master planning 1 0 6 4 6 4 7 5conservation work 2 0 0 0 1 0 0 0certification work 0 0 0 0 0 0 0 0property valuations 0 0 0 0 0 0 0 0Client Adviser Services 0 1 0 0 1 1 0 0post occupancy services 0 0 0 0 0 0 0 0other or other partial services not included above

4 1 14 4 1 1 6 5

ALL 100 100 100 100 100 100 100 100

Table 9-7Average practice revenue from outside the UK, analysed by type of service

Royal Institute of British Architects66 Portland Place, London W1B 1ADT: 020 7580 5533Website: www.architecture.com/benchmarkingCharity number: 210 566

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29 April 2016