Deloitte Competitors Analysis

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Deloitte Touche Tohmatsu Limited, known simply as Deloitte, is one of the largest professional services networks in the world. Founded in 1845, Deloitte has its headquarters in London, United Kingdom. The firm offers its clients risk advisory, audit, consulting, financial advisory, tax, and legal services. 

Deloitte competes in a highly globalized and competitive marketplace. A 2020 study by The Business Research Company valued the Professional Service Market at $5.028 trillion, up with a CAGR of 2.8% from 2015. With technological progress, globalization, and the ever-changing business environment, the study projects a 7.0% CAGR from 2020 to $7.063 trillion in 2025. 

The large size of the market, its growth prospects, and the intense competition present both opportunities and challenges for Deloitte. However, as a leader in the industry, Deloitte has the scale, scope, and brand to compete effectively. This Deloitte competitor analysis provides insight into the competitive landscape and the strategies Deloitte is using to stay ahead of the competition.

Bottom Line Up Front

Deloitte competes for market share in the professional services industry against highly globalized and diversified firms. It stands out as the best choice among the “big four” accounting and consulting firms due to its comprehensive suite of services, breadth of industries it serves, and ability to scale its delivery. However, its competitors have also been making inroads and stealing market share, so Deloitte must continue to innovate and differentiate itself to stay ahead.

List of Deloitte’s Main Competitors

  1. PricewaterhouseCoopers (PwC)
  2. Ernst and Young (EY)
  3. KPMG
  4. Accenture
  5. McKinsey  and Company

Deloitte Business Strategy

Deloitte’s business strategy is focused on delivering differentiated client service through its global network of member firms. The firm strives to be the partner of choice for clients by providing them access to a broad range of services, industry-leading insights, and globally connected people. 

In FY 2021, Deloitte recorded $50.2 billion in aggregated global revenue, a 5.5% increase from the previous fiscal year. Despite the raging pandemic, the firm delivered solid results, thanks to its diverse and resilient business model. The firm operates four main business segments: audit and assurance, consulting, financial advisory, and risk advisory. 

Deloitte’s focus on innovation is another key pillar of its business strategy. The firm invests heavily in research and development to bring innovative solutions and new technologies to market faster. In FY 2021, Deloitte spent 3.5% of its total global revenue on research and development, totaling $1.7 billion. 

Deloitte is also focused on expanding its global footprint to strengthen its market position further. The firm has a strong presence in over 150 countries and continues to grow through organic and inorganic growth strategies. In recent years, Deloitte has made several large acquisitions, including CleverAnt in 2016, aimed at boosting its workforce management advisory capabilities, and Cornerstone Group of Companies in 2017, to broaden its analytics capabilities. 

The most recent acquisition of Bias Corporation in March 2022 expanded Deloitte’s ability to deliver end-to-end cloud transformation services. The company has about 99 acquisitions, valued at over $3.2 billion. Its strategic alignment partners include Amazon Web Services, Google Cloud, IBM, Microsoft, and Oracle. 

See also: Netsuite Competitors Analysis

Deloitte Competitors Analysis

Deloitte competes with the Big Four accounting firms and other large professional services firms. Below is an analysis of Deloitte’s main competitors.

1. PwC

PwC is a brand that coordinates a global network of firms and develops policies and initiatives that foster a coordinated approach to client service. The company operates in 157 countries and has its headquarters in London, United Kingdom. Its long-standing history dates to 1849, when Price Waterhouse was formed, and 1854, when Coopers and Lybrand were founded. A 1998 merger saw the two companies combine to form PricewaterhouseCoopers (PwC), one of the world’s largest professional services firms. 

Like Deloitte, PwC has a diversified business model with varied service offerings. The company’s main business segments are assurance, advisory, and tax. However, it was registered as a multidisciplinary entity meaning its services aren’t restricted to these three areas. It provides data analysis, management consulting, legal, and forensic accounting services. 

PwC’s gross revenue for FY21 was $45 billion, up 4.9% from the previous year. The American region contributed the largest share to this with $18.309 billion in revenue, followed by the Asia Pacific with $8.862 billion, and EMEA with $17.971 billion. The company attributed its revenue growth to its client’s increasing demand for deals, ongoing assurance, and demand for restructuring services in the wake of the pandemic. 

PwC competes with Deloitte for both clients and talent. The two companies are often pitted against each other regarding their size, geographic reach, and the services they offer. Deloitte’s main competitive advantage over PwC is its strong brand and reputation. PwC, on the other hand, has a more diversified business model with a larger share of revenue coming from its assurance service line.

Comparatively, both companies have a large geographic footprint. However, Deloitte has a slight edge over PwC regarding revenue. In FY21, Deloitte’s revenue was $50.2 billion, while PwC’s was $45 billion. Deloitte also has a larger workforce with approximately 345,000 employees against PwC’s 295,371 employees. In 2018, Deloitte controlled about 10.9% of the Global Consulting Market, while PwC held a 10.1% share. 

2. EY (Ernst and Young)

Ernst and Young (EY) is another Big Four accounting firm and one of Deloitte’s main competitors. Headquartered in London, United Kingdom, the company has a presence in over 150 countries and employs nearly 312,250 people. In 1989, two accounting firms – Ernst and Whinney and Arthur Young – merged to form EY. The company has since grown through a series of acquisitions and is currently one of the largest professional services firms in the world. 

EY manages the operations of a network of firms structured to operate as a single, integrated organization. The company’s main business segments are assurance, consulting, strategy and transactions, and tax. EY also provides legal, risk management, and financial advisory services. 

For the fiscal year 2021, EY’s global revenue amounted to $40 billion, up 7.3% from the previous year. Like PwC and Deloitte, assurance was the largest revenue contributor, bringing in $13.567 billion, consulting with $11.135 billion, tax with $10.467 billion, and strategy and transaction at $4.790 billion. The company attributed its revenue growth to increased demand for its services in the Asia-Pacific region and the Americas. 

EY is a competitor to Deloitte, especially in the assurance and advisory businesses. The company has a strong presence in Europe and the Americas with a large workforce. However, it lags behind Deloitte regarding revenue and brand value. Although it crossed the $40 billion mark in revenue in FY21, it’s still $10 billion behind Deloitte. 

To stand out in a competitive market, EY is investing $10 billion in strategy, audit quality, and sustainability by 2024. The company is also focusing on its digital capabilities and is working on developing new innovative technologies that’ll disrupt the traditional accounting and consulting industry.

3. KPMG

KPMG International Limited is another Big Four accounting firm and a major competitor to Deloitte. The company has its functional headquarters in Amstelveen, Netherlands, and its legal headquarters in London, United Kingdom. KPMG stands for “Klynveld Peat Marwick Goerdeler,” named after the 1987 merger of two accounting firms – Klynveld Main Goerdeler and Peat Marwick International. 

The network of firms operates in 145 countries and employs 236,000 people. KPMG has three main lines of business – financial audit, tax, and advisory. The tax and advisory services are further subdivided into several services such as consulting, risk management, financial advisory, and legal services. 

In FY21, KPMG’s revenue was $32.13 billion, an increase of 10% from the previous year. It reported strong growth across its key functions, with advisory taking the lead with 17%, tax and legal service at 8%, and audit with 4% growth. Continued investment in innovation and digital capabilities aligned with clients’ changing needs fueled the company’s growth in FY21. 

Deloitte competes with KPMG in all three of its main business segments – audit, tax, and advisory. Given the size of both companies, they’re well-positioned to compete in the market. However, KPMG trails behind Deloitte in revenue, brand value, and workforce size. It ranks as the fourth-largest accounting firm in the world, with revenue of $32.13 billion in FY21. In 2018, KPMG controlled an estimated 7.1% of the global consultancy market, compared to Deloitte’s 10.9%. 

KPMG has been investing significantly in digital transformation, innovation, and new technologies to bridge the gap with its competitors. The company has also been focused on expanding its global footprint through strategic partnerships and acquisitions. 

See also: Zoom Competitors Analysis [2022]

4. Accenture

Accenture is a global professional services company that focuses on tax, consulting, and technology. It has its headquarters in Dublin, Ireland, and employs about 699,000 people in 50 countries. Founded in 1989, Accenture is one of the world’s largest and most successful consulting firms. 

The company has four main businesses – strategy and consulting, digital and interactive, and technology. It competes with Deloitte mainly in the tax, consulting, and technology businesses. Accenture reported revenue of $50.5 billion in FY21, an increase of 14% in US dollars from the previous year. 

The company invested about $1.1 billion in research and development, $4.2 billion in acquisitions, and $900 million in learning and development. These critical investments were crucial in driving the company’s growth in FY21. Although Deloitte and Accenture are global professional services firms, they have different business models. 

Accenture is a public company, while Deloitte is a private partnership. Essentially, Accenture is answerable to its shareholders, while Deloitte isn’t. By being a public company, Accenture has to generate quarterly results, which can create pressure to make short-term decisions that may not be in the company’s best long-term interests. However, being a private partnership gives Deloitte the ability to take a longer-term view and make decisions that are in the best interests of its partners. 

Deloitte’s competitive advantage over Accenture is its brand value and geographical footprint. While both companies record almost similar revenues, Deloitte wins in terms of brand value. In 2021, Deloitte’s brand value was $26.7 billion, while Accenture’s was $26.7 billion.

5. McKinsey and Company

McKinsey and Company is a management consulting firm that provides consulting services to businesses, governments, and non-profit organizations. The company doesn’t have an official headquarters; however, it operates in over 130 cities and over 65 countries. Founded in 1926, McKinsey and Company are one of the world’s oldest and most successful management consulting firms. 

The company has 12 business functions, including but not limited to design, digital, marketing and sales, implementation, risk and resilience, sustainability, operations, and strategic corporate finance. McKinsey and Company competes with Deloitte mainly in the consulting business. 

In 2018, the company controlled an estimated 4.9% of the global consultancy market, compared to Deloitte’s 10.9%. McKinsey and Company reported revenue of $10.6 billion in FY21, an increase of 1% compared to the previous year. The difference in revenue sources between the two companies means the two companies aren’t direct competitors. However, both companies compete for similar clients in the consulting space. 

Deloitte has a competitive advantage over McKinsey and Company in size and geographic reach. Moreover, Deloitte offers more services than McKinsey and Company, which gives it a more comprehensive offering for clients. It makes Deloitte more attractive to companies looking for a one-stop shop for all their professional services needs.

Deloitte SWOT Analysis

Below is Deloitte’s SWOT analysis highlighting the firm’s strengths, weaknesses, opportunities, and threats.

Strengths

  • A diversified business model with four main segments ensures Deloitte isn’t overly reliant on any one business for growth
  • A strong global presence in over 150 countries means Deloitte can better serve its multinational clients
  • Its customer-focused approach has seen Deloitte grow to become the world’s largest professional services network
  • Extensive research and development investment helps Deloitte bring innovative solutions and new technologies to market faster
  • Deloitte has strong brand equity, which allows it to charge a premium for its services
  • Its approach to technology initiatives is strategic, enabling it to anticipate and respond to industry changes effectively

Weaknesses

  • Deloitte faces numerous lawsuits and investigations about its audit work, which could damage its reputation
  • The company has a complex organizational structure, which can make decision-making slow and difficult
  • Controversies such as being hired to study illegal tobacco trades that “undermined” Australian government legislation on plain cigarette packaging could damage Deloitte’s reputation

Opportunities

  • Deloitte’s focus on technology and innovation positions it well to capitalize on the growing demand for digital transformation services
  • The firm’s strong global presence gives it a competitive advantage in the race to win market share in emerging markets
  • The mid-market business segment is an untapped growth opportunity for Deloitte as it looks to offset slowing growth in its traditional markets
  • New consumer behavior patterns brought on by the pandemic, such as the shift to online shopping, present opportunities for Deloitte to help its clients navigate these changes

Threats

  • Deloitte faces stiff competition from the Big Four accounting firms as well as other large professional services firms
  • The company is also facing increasing pressure to reduce its fees in the face of economic headwinds
  • Currency fluctuations and global trade tensions could negatively impact Deloitte’s revenue growth
  • The company’s reliance on external partnerships and alliances leaves it vulnerable to changes in these relationships
  • Many legal and regulatory changes, such as the EU’s General Data Protection Regulation (GDPR), could increase Deloitte’s compliance costs

Deloitte Competitors Analysis (FAQs)

Question: What makes Deloitte different from other firms?

Answer: Deloitte’s focus on technology and innovation differentiates it from other professional services firms. Moreover, its strong global presence gives it a competitive advantage in serving clients in multiple countries.

Question: Is PwC better than Deloitte?

Answer: Both PwC and Deloitte are large professional services firms that offer a broad range of services to their clients. While Deloitte may have a slight edge regarding brand equity and geographic reach, both firms are highly respected in the industry and offer similar levels of service quality.

Question: What’s Deloitte best known for?

Answer: Deloitte is best known for its auditing, consulting, and tax services. As a leading professional services firm, it has a strong reputation for providing high-quality services to its clients. Besides its core services, Deloitte is known for its focus on technology and innovation.

Question: Why’s Deloitte the best company to work for?

Answer: Deloitte is often ranked as one of the best companies to work for because of its focus on employee development and satisfaction. The firm offers a competitive salary and benefits package, making it an attractive employer.

Conclusion

Deloitte is one of the world’s leading professional services firms, with a strong focus on technology and innovation. It has a large global presence, which gives it a competitive advantage in serving clients in multiple countries. However, it competes with other large professional services firms, such as PwC, KPMG, Accenture, McKinsey and Company, and EY.

To stand out from its competitors, Deloitte must continue to invest in its brand and reputation, as well as its technology and innovation capabilities. It must also focus on delivering high-quality services to clients and maintaining its position as a thought leader in the professional services industry.

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