Home  |  FAQ´s  |  Site Map  |  Contact Us  


The Corporate Finance Research
Specialists in UK Compliance Markets
44+ (0) 1280 843900

  News

  Press Releases

UK Ltd spends more on compliance than on paying its people.
2006-07-14

UK businesses now spend more per year on safety and employment law compliance than they do on HR and payroll services.

“This is a quite exceptional sea change”, claims David Johnston, CEO of A.R.K. Business Analysis, “it speaks volumes about the focus of people management concerns in UK businesses.  And it’s a “could do better” from the headmaster to the HR & payroll industry.”

The HR & Payroll market is £674m in 2006 and will rise to £711m in 2007.  UK Ltd has traditionally relied on the 155 core suppliers in this market for their people management needs.  But increasingly the largest spend by UK businesses is going elsewhere while the HR administration and payroll functions are increasingly commoditised.

Safety and employment law compliance services over took the software based HR & payroll market at the end of 2005 and is now stretching a lead. Safety compliance is a market of £511m currently and employment law compliance is £219m, a combined compliance market of £729m.  The combined market for compliance and payroll services is £1.4bn in the UK which is on course to rise to over £2bn by 2010.


The HR & Payroll market is still doing well in comparative market terms, but as it matures and consolidates it has lost some of its gloss. Profitability is improving while growth is dropping, albeit to levels of only twice the rate of inflation. Venture Capitalists are now making some of the most significant moves in the market and challenging even well established players.

“The clash between consulting and software business models remains the dominant theme across the market overall,” claims Johnston, “it is well advanced among global players, but less so at other levels of the market. Business development has been frantic and highly competitive, but at a tactical level only. Integrated HR & payroll services are now commonplace, employee self service is working, web and .Net is delivering, and modular extensions into human logistics, time & attendance systems, etc are ongoing. But the market has collectively lost the initiative with clients in terms of where the majority of their people spend is going.”

The rise of the compliance markets is instructive, not least as the leading business models are consulting based.  Software development is a core competence, but the strength of the consulting business model is clear.

In terms of which industry is investing more in supporting UK business – from 2007 it is likely to be the Compliance suppliers. The UK HR & Payroll Software Development Report is published by A.R.K. Business Analysis Ltd today and details the complexities and challenges facing this core UK services market.

The UK HR & Payroll Software Developers 2006:

HRM, HCM, Payroll, Time & Attendance, Human Logistics, Safety & Personnel is a new Market Report published in July 2006; prices from £1295.

About A.R.K. Business Analysis Ltd.  A.R.K. is a specialist corporate finance research business focused on complex B2B service and compliance markets. Their experienced team of analysts are typically senior directors who have built, bought and sold businesses in the markets they compile Market Reports for. A.R.K. have developed a unique market mapping process, and provide research to developing businesses, potential acquirers, bankers and investors. Specialists in legal and regulatory compliance markets, A.R.K. Market Reports have been tracking developments in compliance consulting, content and computing services since 2001.

For further information, please contact: DR Johnston, CEO, A.R.K. Business Analysis Ltd, A.R.K. House, 9 Norris Acre, Hinton, Brackley, Northants, NN13 5NN; Tel: 01280 843900, Fax 01280 706606, Email dj@arkbusiness.co.uk.