Regroup leader

Tough market conditions and an exodus of senior staff to set up a rival have posed challenges to RPS in recent years.

Slatford: "We have to compete. We've taken a bit of a hit on our margins to get through the tought times of the recession." Mark Weeks photo
Slatford: "We have to compete. We've taken a bit of a hit on our margins to get through the tought times of the recession." Mark Weeks photo

But its London planning director believes the firm has weathered the storm and lain the groundwork for growth.

When RPS published its last annual financial results in the spring, they didn't make for happy reading. The UK's highest earning planning consultancy - according to Planning's 2010 consultancy survey - had seen its income from planning and development-related services decline by more than 17 per cent to £105 million between 2009 and 2010. More alarmingly, the division's profits plummeted by nearly 31 per cent, from £15.6 million in 2009 to £10.8 million in 2010.

However, Simon Slatford, who is director of RPS's London planning division, is keen to play down the significance of the results, arguing that they are broadly in line with those seen by other consultancies. "Clearly they are a reflection of the recession. Business has quietened down quite a lot over the last two to three years and it's just a reflection of that," he says. "I don't think that we see it as anything peculiar to this group. I think a lot of consultancies are feeling the pinch."

Nobody, of course, would argue that the last three years have been anything other than challenging for planning consultancies. But what about that gap between the percentage fall in income and the percentage fall in profit at RPS? Does that indicate - as one rival asserted ahead of this interview - that the consultancy had slashed fees to retain business? Again, Slatford points out that RPS is hardly alone in the sector in cutting its charges over the last few years. "We've had to revisit our profit margins on the basis that clients generally say that they don't have as much money in the current climate as they used to," he says.

"Therefore for us to continue with those clients - which I'm keen that we do - we've got to compete with the market. Ultimately, that means we've taken a bit of a hit on our margins to get through the tough times of the recession."

But just how far is RPS willing to go? Does Slatford, for instance, always insist that the consultancy makes a profit from every single piece of work it takes on? "We always aim to make a profit, but obviously what we need to do is work harder, more efficiently and more effectively to do that because we must maintain quality for our clients or we'll lose them," he replies.

"Our first priority is to work closely with our clients to deliver the quality that they want and that will give us the work in the future. There are no hard and fast rules about fees. We're in business to make a profit, that's what all businesses should be doing. But we'll take it case by case in terms of what we think are the appropriate levels of fees for the project and what we can agree with the client."

RPS remains, of course, one of the UK's biggest employers of chartered town planners: in the 2010 consultancy survey it reported that it employed more than 100 chartered planners in its UK offices. However, the company's London team received a blow in late 2009 when its then boss John Rhodes left to set up his own consultancy Quod. RPS saw its 2001 acquisition of Rhodes' first venture, Town Planning Consultancy, as a major step in the consultancy expanding its planning capacity. In the end, around 20 of Rhodes' team left RPS to join him at Quod.

"That was very sad, but it happens," says Slatford. "I've moved jobs before. Everybody moves jobs. The guys had been there a long time. John felt that it was time to start something new and a number of people felt that they'd like to go with him." He says the subsequent loss of some clients should not be viewed as surprising. "It was effectively a splitting of clients. John and the people who went with him had one set of clients and to a degree they took quite a few of their existing clients with them. That's the nature of our business," says Slatford.

Looking ahead, Slatford is cautiously optimistic. He says that RPS's retail work held up well in the recession and he expects that to continue. He also sees signs that residential and regeneration work is picking up, particularly in London. Slatford also believes that the consultancy is particularly strong in terms of energy infrastructure projects. "Energy infrastructure work has held up and it's an area that we're looking to continually increase and enhance," he says.

Slatford believes that RPS is particularly suited to working on major energy infrastructure projects because of its range of professional expertise, a strength that even its rivals acknowledge. "I think that we benefit not just from RPS's planning and development expertise, but also from its engineers and scientists and everything else. We're not just planners. We can get expertise in from elsewhere in the company," he says.

Asked what RPS's next set of annual figures will look like in terms of its income from planning and development-related activity, Slatford is understandably reticent. This is, after all, a publicly listed company and he has shareholders to consider. He is, however, willing to say that he hopes the worst is over. "I would like to think that the graph is starting to move upwards. That's got to be our objective. That's what we're all working incredibly hard to do," he says. "The key focus is to keep the clients happy, because that's where the work is going to come from."

However, in terms of how Slatford sees the consultancy market as a whole, he is willing to expand a little. "I think that the market is getting better. The feeling is that the upturn is just around the corner," he says. "The general feeling is that there is more happening. You keep hoping that it's tomorrow. I do genuinely think that more work is coming in and that we're getting busier."

 

CV Highlights

1985: Graduates with a degree in town and country planning from the University of Manchester

1986: Joins Berkshire County Council as a planner in the minerals team

1996: Made an associate at planning consultancy Kember Loudon Williams

2005: Joins RPS as senior director/deputy operational director

2010: Promoted to operational director.


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