However good you may be at your job, you must have, at least once or twice, thought about starting your own consulting business.
The latter comes with several perks-flexible working hours, earning on your own terms and being your own boss.
You can earn from the advice you might have given to others as an employee.
Having said that, going through the transition between a salaried employee and a freelance consultant is no mean feat.
Most people just lack the know-how to kickstart a business consulting firm.
If you are contemplating making the move, here is a definitive guide to getting you started. So, let’s dive in.
One of the key steps in starting a consulting business is to identify your niche.
If you specialise, it will be easier for you to differentiate yourself from the generalised consultants who offer services for ‘everything’ under the sun.
Just think about this for a second. If you have an eye infection, would you go to an ophthalmologist (eye specialist) or a general practitioner?
Of course, an eye specialist because he will be able to solve your unique problem better.
The same logic applies to consulting space as well. Consultants that are specialists in a given niche appear most qualified to potential clients.
Now, when it comes to identifying what your niche or speciality might be, ask yourself the following questions:
And when you have decided on your niche, find if you need special training to sharpen your skill set further. Take advantage of the learning opportunities available in the online and offline world to make yourself stand out.
If you want your newfound venture to succeed, you have to show your clients the specific services you will deliver.
For this reason, it’s vital that you define your services, deliverables, and your business model at the very outset.
Begin by assessing your skills and the specific services you would like to offer.
This is important for several reasons:
These days, businesses hire consultants for several different reasons. If you can cater to any of these areas, it will improve the odds of your succeeding as a consultant:
Your services form the cornerstone of your business. Once you are clear what exactly you will deliver to your clients, you can move on to the next step-getting your business registered.
Getting your business registered will portray your venture in a credible light. It will provide you with the confidence and mental strength for demanding appropriate fees.
If you are based in India, you can choose from any of the following business models:
If you are starting alone, you can work either as a sole proprietor or set up a proprietorship firm. From a legal point of view, a sole proprietor and a proprietorship firm are given the same treatment and tax assessment is carried out in the name of the concerned individual. On the contrary, LLPs and private limited companies are considered a separate legal identity and are taxed accordingly.
To make sure that your business name, logo and brand are protected, it is essential that you get registered under the Trademark Act, 1999.
Once registered, it is time to hire people to do the work for you. Hiring the right support staff can make your work more streamlined as each of your staff members will focus on their designated work.
Even if you want to do all the consulting work on your own, it is advisable to have someone who focuses on the routine work. This may include answering calls, reading emails, typing documentation, pitching potential clients, and so on. This way, you will be able to focus on your core operations i.e. delivering consulting services.
In addition, you will have someone to take care of the office when you are outside meeting clients.
In addition to hiring the right set of people, it is imperative that you have the right tools of the trade to build and maintain a connection with existing or prospective clients and employees.
We all know how remote working has gained traction over the last few months. Using any of the popular video conferencing software such as Zoom, Microsoft Teams, GoToMeeting, Skype for Business or Cisco WebEx will stand you in good stead.
These tools will not only lend authenticity to your business but also make you communicate seamlessly with clients, even when you are out of office. All you need is a smartphone with a reliable internet connection.
In addition, a budding business consulting firm should invest in:
We have seen how companies of this age are counting on the internet to spread the word about their services.
Start with building a website that paints an accurate picture of your business consulting firm. Market your services using your website.
You can leverage the social podium to create awareness about your services. Social channels like Facebook, LinkedIn, etc are powerful avenues to reach the right set of audience.
Listing your business on Google My Business will augment its visibility in the local searches.
In addition to online marketing, you can count on references and word of mouth to drive people to your business.
When you finish working with a client and they appear happy with your work, ask them to refer your services to others. If possible, get a recommendation letter.
In the offline world, you also have the option to advertise your firm locally. This method of advertising can, however, be a bit expensive.
Before you decide on what you will charge, find out what other consultants in your niche are charging for their service. Do a bit of research and set up your rates in a manner that you remain competitive with the rest of the industry.
When establishing your rates, you have several options-hourly rates, project fees, and working on a retainer basis.
While some clients may choose to be billed on an hourly basis, others may prefer lump sum payment for a project. When working on a project basis, consultants typically get a fixed amount for a period of time, that may be quarterly or bi-quarterly.
When working as a retainer, you can set up monthly fees depending on the availability of work for a given number of hours. This will help when you are new to the industry and require a guaranteed income each month to keep yourself afloat.
When establishing charges, make sure you have taken all your expenses into account. If you fail to do so and then find out later that your fees didn’t include many of your expenses, you will only be disappointed.
Setting up prices for your business is a tricky task. This is because if you charge too little, your venture will not be profitable and if you charge too much, you will face difficulty in acquiring clients. The solution lies in studying what other business consulting firms (in the same stage of growth and offering similar services) are charging and fix your rates accordingly.
As with any line of business, you will achieve more success if you have a plan for what lies ahead. This applies to both short-term as well as long-term plans.
In the short term, you can work on a plan as to how you will approach a new project. This way, when a client agrees to avail of your services, you can establish a realistic timeline of how the project will proceed from the beginning to the end.
In the long term, you can have clarity on how you can position yourself within the industry, how you can market your services, and how you can grow your business down the line. With a long-term plan, you can set goals for the next 5 or 10 years.
Once you have your plans in place, review them regularly in order to make the required adjustments from time to time.
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