Heineken's spending on external consultants rises to €192 million

03 May 2019 Consultancy.eu

Heineken's consulting expenses have increased for the second year in a row. The global beer brewer spent around €192 million on external consultants last year, finds an analysis on Heineken’s annual report.

In the slipstream of the financial crisis, many corporations worldwide reduced their advisory budgets. Heineken was an exception to the rule – the Netherlands-headquartered beverages giant in fact increased its spending on external consultants during that period. Between 2009 and 2012, Heineken's consulting expenses increased by some €82 million to a peak of €191 million. After a dip in 2013 – spending fell by 13% to €166 million – the beer brewer's expenses rose again in 2014 to €179 million, before dipping in the subsequent years to €140 million.

Consulting spending

In the past two years, spending on consulting firms, independent consultants and project managers was on the rise again, resulting in a peak of €192 million last year, up 14% from the year previous.

The growth came against a backdrop of continuous growth for the brewer – between 2014 and 2018, Heineken grew its revenue by almost 40% to €26.8 billion, with its net result at €2.15 billion, an increase of around 22% compared to 2014. Year on year, sales increased by around 24% in 2018, while net profit fell slightly by around 2.6% to just under €2.1 billion.

The company’s workforce has grown in line with turnover. The beer brewery had approximately 73,000 FTEs in 2015; that number increased to more than 80,000 in 2017 and to more than 85,000 last year. Consequently, the average consultancy expenditure per FTE amounted to €2,200 in 2018, compared to €2,100 a year earlier. However, in the peak years of 2011 and 2012, spending per FTE amounted to more than €2,500.

Consulting spending of Heineken (€ / million)

Advice processes

In its annual report, Heineken has not disclosed the consulting firms which it has worked with in 2018. Known is that the company taps the expertise of external specialists for a range of topics, including corporate strategy work (McKinsey has been a household supplier for such engagements), digital transformation (Dutch firm SparkOptimus has delivered much work in this field in recent years), advertising and marketing (Heineken uses among others Dentsu Aegis), pension consultancy (Willis Towers Watson is a larger provider) and executive remuneration (the brewer has good ties with Mercer). 

One major project the global brewer completed last year was the introduction of a new work concept in its headquarters in the Netherlands. For this project, aimed at setting up an environment that enables teams to work more effectively and efficiently, while fostering collaboration and innovation, the company worked together with Hospitality Group. The office upgrade comes at a time when Heineken is adopting new and different ways of working – including agile and scrum – across its operations. 

Another change the multinational invested in was the further professionalisation of its internal audit department. By introducing robotic process automation (RPA), internal auditors seek to better monitor spending patterns, allowing for better pinpointing of fraudulent activity and areas for potential efficiency improvements. Late last year this project was lauded for its results at the Internal Audit Innovation Awards, a ceremony organised by Protiviti in collaboration with the Institute of Internal Auditors. 

Related: Nearly 40 billion litres of beer brewed by EU nations.


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