BearingPoint CEO: No Big Pricing Jump Likely

Average gross and net rates per hour are down in the last year, and Rand Blazer says there's only a modest upturn--at best--in sight.
Depressed prices for business consulting services aren't likely to rebound significantly any time soon, according to BearingPoint chairman and CEO Rand Blazer.

The average gross rate per hour that the services firm receives for North American consulting has fallen 5% in the past year, from $226 per hour to $213 per hour. Net rates have fallen 6%, from $170 per hour to $159 per hour. And Blazer, speaking at an investment conference Wednesday in New York, said only a modest uptick is in sight. "It can't get any worse than it is now, but we may see gradual improvement," Blazer said.

Blazer also said BearingPoint will keep rates low if doing so means securing long-term contracts. "We'll give up rates if we can get a larger stream of work from the client. But you can't give up rates without getting something in return," he said.

That strategy may be working for BearingPoint, at least in the public sector. Blazer said the firm is three-for-three in bidding for major government contracts this year. The agreements include deals with the United States Agency for International Development, the State of Florida, and the Department of the Navy. Blazer said BearingPoint is eyeing nine more major deals in the government sector.

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