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“The niche-specific consultancy market stood at $51 billion in 2022 and is expected to reach $66 billion by 2025.”- Gartner
The diversification in business and different business models in India elevated the necessity of niche consultancies that bring expertise to the table of any firm or organisation. With the evolution of liberalisation, various foreign companies like McKinsey & Consulting, Gartner, and more have set up their subsidiaries in India.
As per the report shared by the Financial Express, the consulting IT market stood at $63 billion in FY23 and is expected to touch $70 billion by FY25. Accenture is considered a top global consulting firm, reporting 13% year-on-year (YoY) increases in its revenue. This consulting firm earned around $50.5 million from IT consulting in FY23, 50% more than its revenue of $27.5 million in FY21.
However, Indian consulting firms didn’t disclose their numbers, estimated to be 10% below their revenues. Abhishek Mukherjee, Co-founder and Director of Auctus Advisors, said, “Management consulting firms drive the highest-level decisions. IT services firms are relevant to a relatively small portion of this execution agenda.” Being a neutral body, a niche-specific consultancy firm provides expert-backed advice in areas that business owners might overlook.
Niche-Specific Consultancy Firms in India
India is considered an enormous market for different businesses, and any global brand needs the expertise of a local consultancy that is well-versed in consumers’ ever-changing needs and market dynamics. Various Indian tech giants started niche consultancy firms.
Infosys started its consulting arm in 2004 and made large acquisitions of Lodestone in 2012 and Noah Consulting in 2015. Last year, Infosys also acquired BASE Life Science, a leading consulting firm in Europe’s life science sector. With this, India’s IT firm entered into niche consulting to advise businesses in the life science sector. At the conference, President of Infosys, Ravi Kumar, said, “This acquisition augments Infosys’ deep life sciences expertise, expands our footprint further in the Nordic region and across Europe, and scales our digital transformation capabilities with cloud-based industry solutions.”
In April 2022, Wipro acquired US-based Convergence Acceleration Solutions(CAS) in an acquisition deal of $80 million. CAS is a consulting and programme management company specialising in the telecom space. HCL also acquired Switzerland-based consulting firm Confinale, a digital banking and wealth management consulting firm. With this acquisition, HCL expands its footprint in the global wealth management company by leveraging niche consulting.
Tech Mahindra also acquired the Germany-based Beris consulting firm, which offers advisory services in the automobile and mobility space. As per the sources Business Insider, its goal is to unlock the growth in niche consultancy that aligns with the company’s operating segment. Jatin Gulati, a partner of Actus Advisors, believes that IT companies are typically broad in their portfolios across offerings, industries, and geographies. Small consulting companies that provide advisory services in one niche represent attractive opportunities for large firms to build depth of experience and credentials.
Legitimacy and Value Addition
One of the reasons behind the continued success of niche consultancies in India and other parts of the globe is better industry insights. In McKinsey & Company research in 2023, it was found that around 45% of businesses worldwide are now considering hiring niche consultancy firms to target new markets. Various consulting companies in India help global brands set up and run businesses in India. The role of these niche consulting firms is to guide the management in the ever-changing market dynamics and mitigate risk.
In addition, the role of the niche consultancy firm also makes companies aware of the technologies to early market advantage and add value to the business strategies. In the last five years, the growth of niche consultancy firms has catered to the needs of domestic as well as international clients and showcased legitimacy and value addition.
The Future of Niche Consultancy
The ever-changing business landscape creates a demand for niche consultancy. Gartner’s forecasting report for 2023 found that one-third of ten businesses will hire niche consultants in 2024. It clearly shows the demand for leaders who can manage the team and provide expert-backed advice to the business.
Amid the global consulting giants like McKinsey & Company, PWC, and Accenture, the role of domestic consulting firms will be huge to meet the specific needs. In the future, businesses will look out for experts in niches and flexibility to get the advisory that meets their long-term goals.
