If you have a recognized expertise in a specific field, a teacher’s heart, and a passion for networking and organization, you just may have what it takes to start a consulting business.
You should also be good at analyzing situations and identifying workable solutions; and be savvy in business and marketing operations and technical know-how.
People skills are a must as you must work closely with clients to solve the issues for which they hired you to alleviate.
If you love giving advice, can diplomatically persuade people to try things your way and are thinking that this all sounds like a dream come true in terms of your personality and the “ideal job,” consulting might be the right career move for you.
[photo credit: All in One Training]
How Big Is The Consulting Business Industry?
Consulting covers such a wide array of industries and specialties that it is difficult to pin down the entire market for all types of consulting.
According to IBIS World, management consulting brings in $201 billion in annual revenue and IT consulting $374 billion. Combining these two specialties alone shows over one million businesses employing over three million people.
If you could gather a comprehensive set of statistics for all consulting specialties, you are undoubtedly looking at a market that runs into the trillions in revenue and tens, if not hundreds of millions of employees.
Why Starting A Consulting Business Now Is A Good Idea
A 1998 report in the Monthly Labor Review, reported that service industries had exploded as the primary business model, overtaking the production efforts of the first half of the 20th century. Businesses offering services rather than goods has continued to grow exponentially and the service providers often find themselves in need of expert services that they cannot justify hiring as a full-time position.
Enter the golden opportunity for consultants to fill the bill. A diverse array of fields are hiring consultants for a variety of reasons, all of which add up to a lucrative business opportunity for someone with the right expertise, networking and business savvy to fill the gap.
Consulting Business Facts
Here are some facts and figures about the consulting business you should consider:
Consulting business startup costs
Different specialties may have different startup requirements in terms of capital investment in equipment and supplies for a particular field. As a rough estimate, Entrepreneur reports that a business consultant can generally set up shop for $2,000 to $10,000.
How much do consultants make?
Again, it depends greatly upon the field in which you consult and how much in demand your consulting services are. In other words, your reputation has a lot to do with how much people will pay for your advice. A summary review of several consulting fields at Payscale.com shows the average salary range of a consultant between $32K to $224K.
How much do consultants charge?
Depends upon your expertise and the client’s budget. Entrepreneur recommends negotiating with flexibility as long as you know your bottom line figure to be sure you are covering your overhead costs, such as travel and office time and supplies, as well as your time and labor. They go onto suggest that a new consultant should use 50 percent as a rule of thumb, meaning that your total charges represent double the billable hours. As you gain experience and there is more demand for your services, you may consider raising this to triple the billable hours. As an independent consultant, you can set your own rates so as a starting point, choose your desired annual income and run some calculations to figure out how much it works out to as an hourly rate. $30-60 an hour is not out of line for a new consultant. Experienced consultants in much demand can command a much higher rate, some as much as $200 to $400 per hour. Some consultants charge per project or a flat retainer fee for a set number of monthly hours work for a certain client.
How do consultants find customers?
Direct mail, cold calling, print ads in trade journals and magazines and consultants’ directories, Yellow Pages, online directories, a newsletter or blog covering industry news, editorials, opinions and helpful tips for success, networking with businesses in the field in which you wish to consult and an active social media presence, public speaking and word of mouth referrals.
What skills are required?
Expertise in the field in which you wish to consult, organization, effective networking, goal setting and perseverance, analysis and problem solving, teaching, marketing, charisma and the ability to influence people to try new ways of doing things, managerial, accounting and bookkeeping and you must be tech-savvy.
What do I need to operate a consulting business?
Business license, any necessary professional licenses for the field, tax structure, accounting and bookkeeping setup, professional website and social media accounts, billing system/software; computer, flash drives, email, office space, printer, printer paper and ink.
Consulting Business Ideas
Have a welcoming atmosphere
[photo credit: Security and Defence Agenda]
[photo credit: Security and Defence Agenda]
[photo credit: Bruno Covas]
Clean and approachable office
[photo credit: BAKOKO]
[photo credit: US Department of Education]
[photo credit: We have moved! Please visit/highwaysengland]
Struggling with what to name your consulting business, here are a few ideas:
|Concentric Circles||Wild River Systems|
|Author Advisors||Vision Quest Consulting|
|Whiteboard, Inc.||Falcon Media Group|
|Pond Solutions||BellTower Consultants|
|Navigant Research||Bold Metrics|
|Onyx Graphics||Fund Genius|