The Minneapolis operation, which will remain open for about one month, is led by President Patrick Furey.
Rapp Collins is the fifth-largest marketing services shop in the world and the eighth-largest in the U.S. The 29 employees in Minneapolis represent 1% of a total worldwide workforce of 2,900.
Rapp Collins CEO Malcolm Speed said he had been interested in consolidating the two offices more than a year ago, but faced client opposition from Minnesota-based Schwan's, a food home-delivery company.
"Schwan's, far and away our largest client [at that time], would not accept a consolidation," Mr. Speed said. Since that time, the agency has reduced its relationship with the client while adding two new accounts -- Main Street Network and Genmar.
"It's not an issue from a client standpoint at this time. The move was made for efficiency purposes," Mr. Speed said, explaining that there is "no need for two infrastrucutures" as "the bulk of the business we managed in Minneapolis we will continue to manage from Chicago."
Other Rapp Collins, Minneapolis, accounts to be transferred to the Chicago office include brokerage Dain Rauscher -- a division of Royal Bank of Canada -- Officemax.com and medical device company Medtronic.
Some employees retained
And some people will have the chance to move with those accounts. "That is being finalized right now, but we have extended an opportunity to move for all the senior people," Mr. Speed said. More than five positions would be affected.
The closing -- and imminent layoffs -- follow job reductions at other marketing services shops in the last few months. Publicis Groupe's Frankel in February cut 45 jobs, or 6% of its 730 employees, in Chicago and San Francisco. Interpublic Group of Cos.'s DraftWorldwide, Chicago, let go about 30 people -- close to 4% of its 780-member Chicago workforce -- earlier this year, though it has been staffing up since winning the Burger King Corp. promotions business in January. Draft is the No. 4 marketing services agency globally and No. 3 in the U.S.
Denise Delahanty, vice president-strategic planning at Rapp's Minneapolis office, said the majority of the staffers were not surprised by the consolidation.
"Most people thought it was the right thing to do for the financial health of the company," she said, "and in the long-term, you want to work for a healthy company."
She said having a Minneapolis office to serve local clients does not fit in with the strategy of Rapp Collins. "The vision of the company was a much larger one than that," she said. Ms. Delahanty will not be relocating.
President's fate unclear
Meanwhile, Mr. Furey's future plans are not clear. "Patrick is going to be with us for, at minimum, a short period of time" to carry out the transition, Mr. Speed said. "We have not finalized the longer-time opportunities."
Mr. Furey did not return calls for comment at press time. The Chicago operation is run by President Ian Baer, who could not be reached for comment.