Following my recent post on consultants, a planning consultant that I know well picked me up on a few points where maybe I should have known better. Firstly, it’s pretty obvious that a key objective for any consultant will be to create a relationship with clients in order to build a trust in quality of service etc. and generate repeat and additional work. In the planning sector, it is not unknown for major developers to take advantage of this by getting consultants to spend significant time doing initial evaluations of potential development opportunities with the hint that the consultants would later be instructed if the project was taken on. I’m told that some developers are notorious for getting lots of work done for free without any future instructions.
However, the main and obvious point is that many consultants are providing expert and often specialist services that their clients need and benefit from. Of course, the consultant wants to get their foot in the door. However, given their lack of expertise, some clients can be missing significant business opportunities. Their consultants would not be providing a good service if they didn’t identify them for their clients.
We know that advisors can abuse information asymmetries but it’s often a more nuanced picture than my previous post with its extreme examples suggested.