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Working at extremes

Completing the benchmarking survey became mandatory this year, making the results a true reflection of practice in the UK for the first time. Caroline Cole sifts the data

Architecture in the UK is a cottage industry, with a handful of big players: more than 30% of practices have no employees and more than half have fewer than five people. Only 10% amount to more than 20 and 3% more than 50; an almost insignificant percentage tops 150.

Although micro businesses clearly dominate the profession, more than 60% of fee earners work in practices of more than 20 people. So, while the predominant business model for an architectural practice is tiny, locally based and primarily residential, the bulk of the profession depends on large, national and international practices, with completely different business challenges, client base and project types. The two business models could not be more different. 
Regional diversity is evident across all aspects of this survey, with some RIBA Nations and Regions faring better than others. However, the most striking factor is the dominance of the South East in terms of number and size of practices: half the practices in this survey are in RIBA London, South or South East Regions and 45% of practices with more than 50 people are in the capital. 

London also dominates in terms of reward: on average, an employed architect will earn more in the capital than anywhere else in the country and a partner or director can expect a salary more than 20% higher than his or her nearest rival in any other part of the country.

Income and profit

The profession generates a total income of £1.58bn. Of this, almost half is earned by practices with more than 50 people and only 17% by those with fewer than 10. Practices based in London generate half the total income. 

The profession has written off a staggering £22.2m in bad debts. This reinforces the need both for constant vigilance when it comes to monitoring work in progress, and to be strong about balancing deliverables with payments.

It is a pleasant surprised to see that average profit as a percentage of turnover is just short of 22% – substantially higher than the 15% benchmark. This is an encouraging headline figure, although the modest size of most practices and their modest levels of income mean that not even these profit levels translate into large sums of money for smaller practices.  

Unfortunately, the figures conceal dramatic variations in fortunes. While there are many very successful practices, nearly 40% fall below the benchmark and almost 30% fail to achieve a profit of 10%; 13% break even or make a loss. 

The interesting analysis comes when you see how profit margins fall as practices grow. Internal and external factors can explain this, but almost 60% of practices with 50 or more people fail to meet the benchmark; almost 40% make less than 10% profit and 10% make a loss. 

In real money, the profit achieved by the larger practices is considerably higher than that achieved by even the most profitable smaller practices and so, practices with more than 50 people account for almost 40% of all the profit achieved by the profession. At the other end of the scale, 30% of practices – those with no employees – account for less than 4%.

Average turnover per fee earner is £80,000, rising inlarger practices to just over £100,000. Average profit per fee earner is £17,300 and is highest for mid-range practices of 10-50 people. 

Business management

Reflecting the small size of most practices, the quality of financial monitoring and business planning is far from exemplary. More than 60% have no business plan and frighteningly only 13% plan beyond the current year. Given that time is what architects sell, it is of huge concern that more than a third of firms do not monitor how they spend their time. This improves with size, but even so, a quarter of practices with 20-50 people don’t know how their time is spent. 

However, the most damning figures relates to cash flow forecasting. More than 20% of practices with fewer than five people, and even some of those with more than 50, do not forecast cash flow. This really is inexcusable: poor cash flow management is one of the most often-cited reasons why businesses fail.  

People and salaries

Equity partners or shareholder directors account for 17% of the people working in practices. As expected, this percentage rises in smaller practices to just short of 60% in those with fewer than five people. Associates and senior architects make up 19% of the workforce, architects and technologists 24%; students 15% and non-fee earners for 14%.

Only 25% of fee earners are women. However, the breakdown of fee earning staff by seniority reveals the huge gender inequality within the profession. Of Part I qualified architectural assistants, 40% are women. Regardless of practice size, this percentage falls steadily through the ranks; only 12% of equity partners or shareholder directors are women. Even in practices with fewer than five people, females average only 17% of fee earners with equity; in larger practices the figure is derisory.

Throughout, the larger the practice the larger the salary. The average salary of employee architects rises by 23% in larger practices, while associates in tiny practices earn around 30% less than those in big practices. This means smaller practices need to identify other, less tangible, professional and life-style benefits to attract and retain the best staff.

Partners’ and directors’ pay varies hugely across the profession. Some achieve six-figure salaries, regardless of practice size, and in many locations across the country. However, rewards are generally higher in the larger practices: 54% of partners or directors in practices with more than 50 people take home £100,000 or more. By contrast, more than 40% in practices with fewer than five people earn less than £25,000.

Winning work

Speculative design work is undertaken by 60% of practices and, shockingly, this percentage rises exponentially for larger firms. When architects themselves appear to place so little worth on the value they bring to projects, it is no wonder that profession is often undervalued by those that hold the purse strings. It is high time the profession got its house in order on this. 

Despite this, half of all new projects are won through direct approaches, with no competitive process, while 43% comes from repeat clients. About a fifth of new work is won via competitive fee bids where money is the only criterion. Disappointingly, especially for smaller, new practices looking to make their names, less than 1% is won through open design competitions. 

The profession still focuses on delivering a full architectural service. But, perhaps reflecting clients’ reluctance to commit to long-term contracts nowadays, 87% of practices offer design services to planning stage only. At the other end of the spectrum, just over 40% offer a standalone production information service and 18% offer contract administration. The only other service offered by more than half of the practices is conservation and restoration. 

It is disappointing that only 6% of the profession’s work is consultancy or advisory.

The residential market accounts for a quarter of the profession’s fees. Education accounts for 15%, while mixed use and offices are the only other sectors to contribute more than 10%.

Both small and large practices earn fees from private corporate clients, although the vast majority go to larger firms. However, when you look at the other client types the dichotomy between both ends of the profession really comes to light. Domestic clients account for 65% of fees in practices with no employees but only 16% in those with 20-50 people. By contrast, the public sector, with its tick box procurement routes and KPI driven delivery, hardly features in the lives of the smaller practices but accounts for more than a fifth of the fees in practices with more than 20 people.

Astonishingly, practices with more than 50 people now  earn 27% of their income  from contractor clients, which places them firmly in  ‘the construction industry’ supply chain; a far cry from the patronage of domestic projects. 

The total percentage of income from international projects is only 3%, although this rises to 7% for practices in London and 18% for those with more than 50 people.


Given the diversity of the profession, the first challenge for anyone leading an architectural practice must be to define unambiguous aspirations, so that a  business strategy can be put in place either to make the most of existing markets, or to implement the changes needed to meet any aspirations that involve growth. 

The second challenge is to recognise that if growth is on the agenda, then simply being a great designer, or a good project runner, is unlikely to be enough. Few practices, regardless of scale, have chosen to invite non-fee earners into the boardroom, so architects leading practices with, say, more than 10 people, need themselves to develop the necessary business acumen and be prepared to spend a sizeable percentage of their own time off projects, nurturing the business. 

For most, there will need to be a step change to move from simply being a successful architect to running a successful architectural business.


Caroline Cole is director of Colander, which analysed the survey for the RIBA. A report with more detail on the findings is sent to chartered practices and an executive summary is available at


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