Before you start on about ways to start a consulting business, it is important to understand who is a consultant. In common terms, a consultant is an expert in any field who offers the advice as a service. When a consultant starts a business, his business is a consulting business. You can have many types of consultation from IT to HR and even business processes.
The only pre-condition is your expertise in the chosen field that you choose to continue your consultation service in. So the question then is how to start a consulting business? What most would be interested in knowing though is
- What are the pre-conditions to start a consulting business?
- Are there any qualifications that you need to start such a business?
- What is the kind of funding that is required to start the business?
The fact is that a consultant’s job is to simply consult, nothing more than that and nothing less either. Therefore, for you to have a thriving business it is very important that your consulting business has access to the
- Right set of target audience
- Right type of knowledge base
- Appropriate resources to make it big
Here is a quick lowdown on how to start a business and some easy steps to enhance your whole consulting business.
Knowledge Is Crucial
When you start a consulting business, you must understand that knowledge is the primary commodity that you are dealing with. So you must understand that you must assert your knowledge at every possible opportunity. The client when they select you, it is predominantly on the basis of the knowledge base they have. It implies highlight your superior understanding and overall expertise that you have created your overall niche in. Your essential deliverable is knowledge. Remember that if you do not deliver in the right form and right spirit, then your core expertise becomes susceptible to being questioned.
So, stay true to your core area of expertise and be forthright in your advice. Even if that means the client does not agree with certain aspects of your advice and do not agree with you, that’s perfectly all right. More or less, the core point is that do not crimp on the quality of advice that you can offer. When you are confident, and the knowledge speaks for you, there is no other element that can stop your progress.
Pricing Your Service Is Crucial
When you start a consulting business, a primary mistake that you need to be careful about is how much you are charging. In fact, studies indicate that this is one of the biggest mistakes that most consultants are guilty of in the initial days. Most new consultants end up not charging enough for their service. Though there is no magic formula to set the right kind of fee structure but remember that whatever or however you charge, don’t crimp on rates just because of your limited experience. One ground rule is that always charge more than you think you should.
Remember that as a consultant it is extremely important to project your overall return on investment. The fact is it is not just important to you but also to your clients. When you can project and prove a sufficiently high ROI, you can also charge an appropriate percentage of the client’s profit as your charges. The basic point is that the higher your rate is, the better you would look on the balance sheet, both on the client’s as well as yours. If you look at industry dynamics, you will notice that a consultant with an hourly rate of $1,000 per hour would be valued much higher than someone with an hourly rate of $100 per hour. Clients tend to go for the consultants who have relatively higher billing rate.
Presentation Is Crucial
You must remember a crucial fact when you start a consulting business. The ultimate property that you are selling is you. Starting from your knowledge to your personality and poise everything is up for display and often subject to the client’s scrutiny. While there is nothing bad or sordid about the whole thing, the fact remains that the client decides on a consultant based on the entire personality and the way you dress and talk also play a crucial role. This is exactly why when you start a consulting business, you must
- Dress in an appropriate fashion and project the right type of personality dynamics
- Price your services in a way that it makes the right type of impression in front of the client
- Project your trustworthiness in a big way and leave no stone unturned in terms of convincing your client about your overall trustworthiness
- Create a strong brand entity and market yourself accordingly
Don’t Give up Easily
Another factor that you must be very careful of when you start a consulting business is the fact that you need to be stoic in terms of dealing with disappointment. There are moments of devastation that every business needs to tackle with, but there is no point in losing heart. You need to be strong and deal with it maturely. Moreover remember that disappointment is part and parcel of any business and you have to prepare for it as much as the physical and mental toll that this business takes on you. The point is your positive spirit can often make the business model more profitable.
Therefore, when you start a consulting business, it goes beyond the simple task of creating a business plan and raising funds. You have to employ a comprehensive game plan and ensure that you sharpen your skill sets to deal with the challenges of the field in every possible manner. The core idea is that this is a specific kind of business where your knowledge is your biggest asset as well as greatest liability; the point is how well can you utilize your talent. Also look at continuous updating of knowledge for better results.