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What Exactly Do Consultants Do?
Essentially, consultants provide expert recommendations, analysis and opinions to companies, individuals or organizations based on their personal experience and expertise.
They can serve as an objective troubleshooter, providing strategies to improve performance and prevent problems.
How Do You Get Paid as a Consultant?
Most consultants work as independent contractors or freelancers. This creates the opportunity to be paid in several different ways. You may work by the hour, by the project or even on a retainer.
Your payment method will vary according to your own preferences and how your client prefers to work. While some clients prefer hourly billing, others will prefer to pay by the project, so they can budget for exactly how much it will cost before they begin.
What Skills Do You Need to be a Consultant?
While what is needed for a consultancy job will depend on the specific area and your expertise knowledge, there are some key skills.
- Attention to detail
- Superb interpersonal skills
- Team Working skills
- Good numeracy
- IT skills
- Commercial awareness
- Persuasive ability and tact.
10 Steps to Become a Consultant
Step One: Identify Your Niche
It is very difficult to become a consultant unless you are intimately familiar with a particular industry or niche. While you may have an interest in computers, you cannot automatically assume that this is sufficient to become a consultant. You need both knowledge and experience.
So, think about your previous work experience and current skill set. If you have worked for a considerable amount of time in a particular field and are up to date in the latest industry developments, this is a good choice of consultancy field.
Step Two: Acquire the Relevant Certifications and Licenses
While some consulting businesses do not require formal training or certifications, some do. For example, if you want to work as a consultant in gardening, practical experience is likely to be far more important that a certification. But, if you want to work as an accounting consultant, you will need to hold professional certifications from a recognized accounting institution.
You also need to think about the licensing requirements to start your consulting business. These can vary according to your local and state guidelines. You may need to obtain a particular license to operate in certain areas or specialties. Fortunately, there is guidance on the Small Business Adminstration website.
Step Three: Set Goals
Every business needs to have a plan, so you’ll need to think about the long and short term goals for your consulting business. When you consider how to become a consultant, you may have a vision of having clients queueing up for your services from day one. But, this is unrealistic. So, you need to prepare for this.
Will you operate your consulting around your current workload. An alternative is to work a flexible side gig that allows you to do consulting work as and when required. It may take years to develop a reputation that allows you to work full time consulting. So, think about how you will cover your expenses in the meantime.
Step Four: Think About Your Target Market
Like any business, you will need to think about who will pay for your services. You need clients who not only have the money to pay you, but are also willing to pay you. So, give some thought to your target market.
Will you be advising companies or individuals? Even this simple question can determine your marketing strategies and whether your business will face failure.
For example, if you are going to work as a career consultant, you may be working in a large corporation helping employees to excel within a chosen field. Alternatively, you may work with individuals to help them to plan their career.
One of the best ways to gauge this is to establish your social media presence. This will allow you to spend time with your target market and learn more about their needs.
Step Five: Do Your Research
Once you have determined your target market, you will need to conduct some more research. Organizations, companies and individuals hire consultants for different reasons. A computer consultant can help a large company transition to a new software suite. A tax consultant can help a millionaire plan taxes and retirement. Human resource consultants can help big businesses to implement policy changes.
One you determine your target market, you need to find out the ways in which you could use your expertise to help them. This is invaluable, as it will help you to explain why potential clients need you. You can also use this information to create effective marketing strategies.
Step Six: Set Up Your Office
One of the attractive things you’ll discover about how to become a consultant is that most of your work will be done in the client’s premises or online. This means that you don’t need a large amount of initial capital to set up fancy offices. In most cases, you simply need access to a computer and internet connection.
If your consulting business does scale, you may acquire premises once you need to take on associates. But, initially, you can keep your costs as low as possible.
Step Seven: Build a Network
If you’re unknown in your field, you may struggle to get noticed and hired for your services. So, it is crucial that you start to build a network. This will allow you to create a strong contact base, which will help you to find sources of work.
A professional and social network will help you advertise and market your business. You can also gain referrals and build your reputation. You can start online with platforms such as LinkedIn. It is also worth checking out the local chamber of commerce in your area. This will help you to network with professionals in your town or city.
Step Eight: Organize Billing
Next, you’ll need to think about how much you’ll charge your clients and how you will accept payments. As a new consultancy, you may not receive the highest fees. It is likely that you will increase your fees as you build your reputation. Try to set your fees realistically, accounting for your experience and credentials, the market conditions, your competitors and your target market when you set your fees.
For example, it is unrealistic to expect a small business looking to adopt a new software system to pay $200 an hour for something that will only save them $20 a month. However, if you’re marketing to large companies that can save $10,000 a week with your help, $200 an hour is a bargain.
You will also need to think about client billing. You’ll need to keep track of your invoices and maintain accurate income and expenses reports. Otherwise you may end up with a hefty tax bill.
Step Nine: Find Clients
Once you have determined your target market and how you will manage the logistics of your business, you need to find clients.
There are lots of ways to advertise a new business, including:
- Online ads
- Cold calls
- Print media
Each of these methods has a cost, which you will need to factor into your budget. Additionally, some methods will be more appropriate to your niche. For example, if you’re offering landscape consultancy, cold calling and print media can be a good way to find clients. But, if you are a computer consultant, online ads and an SEO optimized website would be a better choice.
Step Ten: Do You Need to Outsource Tasks?
While it may be tempting to try to juggle all aspects of your consulting business, this may not be the best idea. You may find that it is more cost effective to outsource some tasks. This will allow you to focus on your strengths and core business.
For example, if you’re operating a career consulting business, it is reasonable to outsource your accounting and auditing. But, if your niche is accountancy, it makes more sense to outsource online advertising and SEO.
If you need help with the general admin for your business, consider hiring a virtual assistant.
Most tasks can be outsourced to freelancers, but if you are considering employing people, ensure that you check the tax and legal details before making a final decision.