Consulting may sound like the easiest businesses to start.
While there’s some truth to that, you know it’s never that easy.
Here are 7 tips I’ve learned about starting up a consulting business.
- Find ways to use specific information gaps
- Focus on relationships, not revenues
- Sell results, not services
- Always be closing
- The more you charge, the less they complain
- The day you start losing them
- Be professional about billing
Find ways to use specific information gaps.
An information gap is where someone is missing information needed to complete a task and needs to talk to you to find it. You will help them fill in the blanks.
Focus on relationships, not revenues.
Consulting is a relationship based business. Wise consultants always listen before speaking. Never talk costs before first knowing the specific needs and objectives. There are a lot of businesses owners actively looking to hire consultants. Contact as many people as you can help.
Remember this, opportunities come every day while great opportunities come every now and then. The only way you will catch a great opportunity is being ready. Practice and learn every single day.
Sell results, not services.
Price by the hour and you’ll be viewed like everyone else, a commodity. Instead bill based on scope of work and end results.
Always be closing.
Every business needs to get exposure and clients, and you have to be willing to sell yourself. You will always need to be making contacts to get more business. It’s imperative that you constantly ask current clients for more work and also ask them if they know of other similar businesses that can use your skills. This is an ongoing networking process that you need to develop to establish a long-term business.
Keep in mind that if you talk to a person that is interested in what you offer and you don’t “ask for the sale” you just waste your and the other person time. Always be closing.
The more you charge, the less they complain.
One of the first things I learned is that the more money a client pays you, the less they will complain.
Large paying clients know that if they want to continue to grow, they have to spend money. When doing so, sometimes things work out, while other times they don’t, but at the end of the day, they have to keep investing.
On the other hand, smaller clients don’t have that much money. So, if they hire you and you mess up, they usually don’t have the luxury of hiring someone else like the larger clients do.
When you first start off, you may have to take on smaller paying clients, but your goal should be to transition to the larger paying ones as quickly as possible.
The day you start losing them.
You never know how long a client is going to stay with you, therefore do whatever you can do to keep them. Here’s what I used to do to ensure that clients stay as long as possible:
- Set expectations from day one – let them know what they should expect and when to expect it by.
- Ongoing calls – I suggest you have weekly calls with your client but your arrangement may be different and it might only require calls ones or twice per month. In this 10 minutes or less call you want to tell your client what you have done since your last call and see if they have any questions.
- Monthly reports – with everything you did. Include visual aids. You should go over the report with the client over the phone or in person.
- Monthly surveys – at the end of each month, send your clients a quick survey. The survey needs to have specific questions that help you improve the quality of your work. Include questions such as “how can we make the monthly report better?”
Be professional about billing.
As a consultant you should be able to do basic accounting to monitor expenses and client billing.
You should set up one day each month to generate bills and track those individuals who haven’t paid you. This is your accounts receivable. It is very important because late payments by clients can kill a business before it gets up and running.