Starting a consulting business from home is ideal for people who are experts in a specific field, and aims to help others (be it a company or an individual) to reach their goals. It’s basically sharing your expertise to those who need it the most without having to leave your home.
Yes, you read it right. You can absolutely put up a consulting business from home if you want to.
Working from home is actually the best idea or the best work setup these days. Given the current protocols mandated by the government and health experts – you know, social distancing and all – it’s better to work remotely and away from the crowd.
There are a lot of ways to make money from home. You can either work for a client or a company, or you can put up your own business. In this case – a consulting business.
In data presented by Statista, it shows that management consulting in the United States is a growing industry. In fact, as of 2019, the number rose to 709,750 – definitely bigger than how it was before. Experts believe that the number will continue to rise in the coming years.
Well, with the current health situation in the country and in the world, generally, it won’t be surprising if the number increases.
So, are you into the idea of setting up your own consulting business? If yes, then, do not go elsewhere because we are going to provide you some of the most important information you need to know in setting up your very own consulting business from home.
In particular, we are going to tackle the following:
- What is consulting?
- What does a consultant do?
- What are the things to consider before you become a consultant?
- Who qualifies for a consultant job?
- How much does a consultant make?
- How to start a consulting business?
WHAT IS CONSULTING?
First of all, before you even start off a consulting business, it is important that you fully understand what consulting is all about. Unlike other jobs, as a consultant, you offer your expertise to your clients. Thus, it is vital that you know how things work as one.
So, what is consulting?
A lot of people usually confuses consulting to Harvard MBAs advising enterprise businesses on corporate strategy. Meaning, consultants are people who have obtained challenging degrees as well as difficult certifications from well-known universities.
But in reality, that’s not what consulting is all about really.
According to the Oxford Dictionary, consulting means “engaged in the business of giving expert advice to people working in a specific field.” To put it simply, consulting refers to the job of a person who gives advice to an individual, a company, or a specific group of people.
Consulting refers to the business of providing expert advice to an individual, a company, or a certain group of people.
If you want to know more about the consulting business per se, here’s a video by Dan Lok. He provides helpful tips that will surely be of help to succeed in this kind of business venture.
WHAT DOES A CONSULTANT DO?
Apart from understanding what consulting is all about, it is also important that you know what a consultant does. The success of your consulting business does not only rely on how great you are in a specific field but how knowledgeable you are on the business.
In an article by Harvard Business Review entitled, “Consulting Is More Than Giving Advice,” it provided what they call as “hierarchy of consulting purposes.” In a layman’s term, it basically means, what a consultant does or what a consultant is expected to do.
Based on the article, a consultant’s job includes the following:
1. Providing information to a client.
2. Solving a client’s problems.
3. Making a diagnosis, which may necessitate redefinition of the problem.
4. Making recommendations based on the diagnosis.
5. Assisting with implementation of recommended solutions.
6. Building a consensus and commitment around corrective action.
7. Facilitating client learning—that is, teaching clients how to resolve similar problems in the future.
8. Permanently improving organizational effectiveness.
If you are able to provide all these, then, you are on your way to success. Of course, you have to do each item excellently to please your clients, and eventually earn your spot in the consulting industry.
WHAT ARE THE THINGS TO CONSIDER BEFORE YOU BECOME A CONSULTANT?
So you know you are an expert on a specific field, and you think you have what it takes to be a consultant. Should you just jump into building your business?
The answer would be no. There are certain things that you need to take into consideration first before you put up your consulting business. This is to avoid any errors along the way.
Some of the things you need to consider are as follows:
- Certifications and Special Licensing – Before you can even start operating as a consultant, you need to consider the certifications and/or special licensing you need depending on your profession. Otherwise, you won’t be eligible to put up a consulting business. The requirements usually vary depending on your profession, so make sure you check on that. Also, consider state regulations, too.
- Qualifications – Not because you feel like you are good with computers, then you can be a computer consultant. Make sure you have what it takes to be one. Otherwise, you won’t get hired by any client. If for instance, you want to be a computer consultant, make sure you are up-to-date with the latest trends and changes in the computer industry. Being updated is very important especially with competition around.
- Organizational Skills – Consultants are usually organized people. They are excellent when it comes to time management, and generally, they always do things according to plan, which is very important to ensure you get to meet deadlines, as well as the demands of your clients and work in general.
- Network – Networking is a critical aspect to the success of any consulting business. If you want to put up a consulting firm, make sure you work on building your network of contacts. Having a strong network can definitely help in the success of your business.
- Professional and Business Goals – As a consultant, or as someone who aims to put up his or her very own firm, it is important to have both short-term and long-term goals – professionally and the business. Your goals will also help you stay in the right direction. Needless to say, it helps you weigh whether it’s worth putting up a business or not.
WHO QUALIFIES FOR A CONSULTANT JOB?
Let’s be realistic, not everyone is ideal for the job. It takes a lot of expertise and experience to be qualified as a consultant.
Generally, companies and even individual clients prefer consultant who:
- Have earned a bachelor’s degree (some prefers those from top institutions)
- Does have an exceptional problem-solving skill (with an analytical, innovative, as well as creative mindset)
- Has aptitude in grasping new concepts as well as efficiently produce results
- Has well-developed core consulting skills of research, analysis, presentation, and have an excellent eye to detail
- Has exceptional verbal and written communication skills
- Has the ability to be self-directed and be an independent contributor
In addition, as a consultant, you must also have the following:
- Confidence and maturity to work with senior clients
- Ability to manage and structure intensive workloads
- A high degree of emotional intelligence
- Excellent organizational skills
It is important to note that qualifications vary from one client or company to another. Thus, it is important to check and review the requirements a client needs before submitting a pitch or an application.
HOW MUCH DOES A CONSULTANT MAKE?
According to Glassdoor, consultants in the United States earn $77,368 per year on an average. The rate though can go as low as $53,000 or could go as high as $113,000.
Meanwhile, based on the Harvard Business Review article that we mentioned earlier, every year, management consultants in the country receive more than $2 billion for their services. Sounds very encouraging, right?
Of course, how much you make as a consultant depends on the field you’re in, your years of experience, and your line of expertise. In most cases, your educational attainment, as well as certifications you gained over the years, also helps in increasing your rate. Thus, the need to be continuously updated in your line of expertise, and also to always upgrade your knowledge.
HOW TO START A CONSULTING BUSINESS?
So, we have already discussed what consulting and being a consultant means. We’ve talked about the qualifications required, and the annual salary of the consultant.
This time, we’ve reached the most important point – how to actually start a consulting business at home.
Unlike other businesses, consulting can be done right in the comfort of your home. All you need is your knowledge and expertise, your network, and of course the technical requirements of the business or job. Meaning, your computer, internet connection, and other important equipment depending on the industry you’re in.
Similar to any business, there are steps to guide you through as you start off a consulting business, and this includes the following:
STEP 1: Find Your Niche
Like any business, there is competition out there, and to be able to compete with everyone else in the industry, you got to offer something that you really know of.
As a consultant, you do not have to offer anything and everything to everyone. The most successful consultants are the ones who offer services based on their line of expertise.
Finding your niche, in particular, helps a lot in the success of a business. By focusing on a specific niche, you can tailor your services so they add value to a particular group of people or companies and businesses.
We highly recommend asking yourselves the following questions as you try to figure out your consulting niche:
- What services are not available in the area or industry you’re in?
- What is your expertise?
- What particular problems are you able to solve that no one else is catering to?
- Who is your target audience?
Once you have defined what you do and who you do it for, everything else will fall into place. You’d know who your potential clients would be, and you can now start pitching and marketing your consulting services.
STEP 2: Craft a Pitch
Similar in other industries, a pitch is all about what product or service you are selling.
In this case, you are selling yourself. Your own expertise. Your knowledge in the industry you’re in.
Crafting your pitch will help you ensure you know exactly what you are selling, at the same time, how it will help your potential client.
When selling, make sure that you are selling something your client wants to buy. Your pitch has to be customer-facing. Once done with your pitch, take a step back, and ensure your positioning services that are right for a consultant.
If you have business friends, it would be of help if you send it to them and ask for feedback in return.
You know, at the end of the day, your end-goal is to win your client. So, make sure you serve him or her something that he or she needs.
STEP 3: Master Your Talking Points
As the saying goes, practice makes perfect. To master your pitch, you better practice it.
When creating talking points, make sure to keep it short, make the descriptions of what you do, and how to do it concisely.
Your talking points and your mastery of them is key to pitching and promoting your consulting business.
Apart from the fact, though, that the talking points should explain what you do, they should also highlight the reasons why you stand out from the rest, and why the clients should choose you.
Again, similar to crafting your pitch, when mastering your talking points, make sure to send it to trustworthy friends who can give you constructive criticisms.
STEP 4: Come Up with a System
Remember, being organized is very important to a consultant. Even so, if you have your own consulting business.
One way to keep things organized, especially with processes is to create a system. This way, you avoid starting over again for every project.
A system in place will help ensure that you are able to provide the same level of expertise to every client. Needless to say, it makes things easier for you and your team (if you intend to have any).
Some systems you can create are data-gathering forms, proposal template, description of the services you offer, a portfolio of your work, onboarding questions, etc.
By having a system in your consulting business, you make working efficiently possible, you avoid forgetting or missing out important information, forms, or documents, you’d have a coherent, branded look for all forms and documents, and most of all, you maintain a consistent approach for working with all clients.
STEP 5: Create a Pricing Structure
Coming up with a pricing structure may require some analysis as well as some trial and error to know how much time a project will take.
When creating prices, make sure to take into consideration the following factors:
- The standard pricing in your industry
- The time you expect to invest in each task
- The money you need to support the business and ensure income
- Other resources or expenses that will be incurred from outside your business
- Costs like health insurance or retirement matching (unless covered by the employer or client)
- Your experience and expertise
If you are unsure of your pricing, you may consider using a pricing template or time-tracker to estimate the time you need for a new project. Once you have established a set rate, put your pricing structure in writing, and make sure to stick to it.
When setting a price for the work that you do, make sure it’s worth it. Also, do not settle for a lower price just to get a client, otherwise, clients will not take you seriously. You do not want that.
STEP 6: Look Into Your Network
Ideally, you should have a solid network already before you even start your business. This makes things easier for you.
You basically just have to think about all the people you want to offer your consulting services, and then you list them down.
Your list should include all your business colleagues both in the past and current. Also, you may consider looking into your social media platforms like LinkedIn to track down people you have worked with before.
Apart from colleagues, list down also your family and friends, neighbors, relatives, and different service providers.
The idea is to list down as many as you can. Who knows, maybe five or 10 or maybe more of those on your list need your services after all, right?
STEP 7: Spread the Word
Having done steps one to six, by now, you are ready to spread the word and officially launch your consulting business.
One way of spreading the word is by sending an email to each and every person on your list. As much as possible, no matter how generic your email is, include some personal touch.
While you can use an email marketing service provider to automate emails, you can also consider sitting down and sending out 10 to 20 emails a day by yourself.
Remember, when starting out a business, in this case, a consulting business, it takes a lot of patience and time. You got to be determined, and you have to keep going until you hit your very first client.
All you need is one person to believe in your business, and everything else will follow — for sure.
FINAL THOUGHTS ON CONSULTING BUSINESS
In this day and age, thanks to digital technology and the internet, more and more businesses can be put up while at home. One of the businesses you can start off is a consulting business.
With the right knowledge, expertise, and experience, as well as determination, patience, and persistence, you will surely make it in this line of business.
So, are you ready to start off your own?