How to Start a Consulting Business

If you’re passionate about entrepreneurship and you have a following in your industry, the consulting field could be right up your alley. The following guide can help you learn how to start your own consulting business.

Consulting comes in many forms, and – let’s be honest – there’s a bit of a stigma attached to the profession, making the career a bit confusing. So, let’s first look at what a consultant is and what a consulting firm does.

What is a Consultant?

Before we deep dive into how to start your own consulting business, let’s tackle what’s entailed in a consultant’s role.

Consultants offer expert advice to other professionals in the same field.

It sounds simple but seeing success in the consulting field depends not just on having professional experience in your industry but also on your own innate abilities for solving problems and making decisions.

The consulting field can be segregated into two main subfields:

  • Strategy consulting. A strategy consultant focuses efforts on helping a business overcome its competitors and elevate its profits. When a business owner faces a tough business decision, a strategy consultant helps the owner address how to proceed.

  • Management consulting. A management consultant is responsible for the development or improvement of specific business strategies. Most management consultants usually specialize in a specific industry, such as human resources, IT, or healthcare.

SQUARE FOR PROFESSIONAL SERVICES

A mobile point of sale as expert as your professional services.

What Do Consultants Do?

The reasons business owners and other professionals often hire a consultant span from incorporating small changes to entirely overhauling the way a business currently operates.

Some of the reasons professionals might reach out for your services include:

  • Your expertise in a specific subject or field
  • Your ability to identify and solve problems
  • Improving business processes
  • Help to execute a new model, method, process, or strategy
  • Assistance overseeing the development of a new business

Whether you’re ready to open your doors tomorrow or you’re just in the consideration phase, it’s important you understand how consultants specialize – then you can decide what niche you fit in.

How to Start a Consulting Business

After you know your specialized skill set, now’s the time to start moving towards actually becoming a consultant and starting your business. The following steps will help you start your own consulting firm.

1) See if you need any special certifications.

For starters, having a certification or two can help you win business. But certifications may also be required depending on the province where you expect to conduct your consulting activities. Check with the regulatory agencies in your province to see what special certifications you may need. Some of the credentials include:

  • Certified Management Consultant (CMC). The CMC is offered to consultants who’ve met specific performance standards in such areas as ethics, competency, conduct, and project management.

  • Regulated Canadian Immigration Consultant (RCIC). If your dream is to help immigrants find a new home in Canada, you can become an RCIC. Certification for this consulting field is offered by the College of Immigration and Citizenship Consultants (CICC).

  • Financial Planning Consultant. In Canada, you must be a Certified Financial Planner (CFP) to conduct consulting services in this field. FP Canada gives this certification.

2) Get your finances in order.

Starting your own consulting business can be expensive. You must create a viable budget, including all your expenses. You may even decide – or realize – that you’ll need more capital for real success. If you decide to get a loan, create a plan for how it will be spent. Many consultants fail to factor in that personal and business finances must be kept separate from the start. To ensure you don’t overspend, it might be beneficial to meet with an advisor for help distinguishing personal and business expenses.

3) Figure out your fee schedule for services.

What do you think your clients are willing to pay for your consulting services? How much do you think your services are worth? There’s a delicate balance to this all-important question. You should base your fees on how you value your work – referencing these general consulting fee schedules should help.

Once you determine your fee, choose a software program that lets your clients pay you once services are rendered. Consultants typically use a contract and invoice method to bill their clients for work performed. With a strong invoicing system, you can input all your client information and send the invoice via email. If you use your phone a lot during the workday, invoicing apps let you remain flexible and send your invoices from anywhere within seconds.

4) Create your business plan.

Now it’s time for you to craft a solid business plan. The foundation of your plan is the value you offer to your target market. This should be highlighted at the very beginning.

Afterward, include how you differ from competing consultants and where you stand financially, such as how much it will cost to start your consulting business and how much you expect to make from selling your services.

It’s important to note that this business plan is fluid – things change as time goes on, and that’s okay. You may need to modify the plan from time to time, such as when your long-term goals change or new opportunities present themselves.

5) Consider how you’ll market your services.

Consulting is competitive, making a solid marketing plan a must. Networking is a sure bet to begin building a stable of qualified clients. Your goal is to become the go-to source in your industry. To do that, you’ll have to consistently network, building loyalty as you go.

Standing Out Amongst Your Competition

Anyone with specialized knowledge of a given industry might at one point decide to try consulting – but it takes a lot more than just industry experience. The best, most sought-after consultants are hungry for – and strive towards – excelling at their game. This puts them in the spotlight, helping them stand out amongst competitors.

But don’t let a little competition spook you into never trying. Here’s how you can separate yourself from the pack:

Discover how to exploit gaps in knowledge. Every industry is unique with its own set of challenges, which is where the opportunity is. Offering an answer to the toughest questions all but ensures your success.

Focus on the person or company, not what you get out of it. To be the best consultant, you have to have a vested interest in the individual or company that you’re consulting for. Your motivation should derive from helping clients solve unique challenges rather than from the money offered.

Sell results, not services. Sure, your clients will seek you out because of your services, but what they’re really paying you for is the result.

Keep your business organized. It can be difficult to run a business. For instance, managing your cash flow sounds easy on paper, but even the slightest mistake can cause expensive ripples. Managing your invoices can help you improve cash flow and minimize risk.

Ready to begin your consulting career? Ask how Square can help.