consulting startup business plan

How To Start A Consulting Business In 2024

Updated: Feb 11, 2024, 3:43pm

Table of Contents

1. outline your plan, 2. register your consulting business, 3. determine services and pricing, 4. build your website, 5. market your consulting business, frequently asked questions.

Those with a high degree of expertise in a particular field can leverage their knowledge to build a profitable consulting business. Whether you’re in between jobs or looking to make a change, learning how to start a consulting business is the first step to making great use of your skills. In return, you can create a lucrative business and can charge upwards of $300 per hour–all for sharing your expertise with others. Here’s everything you need to know.

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To get started, you’ll want to put together a strong business plan. While you don’t have to stick to every single thing, it’s a good idea to have guidance for your business.

The first choice to make is your business name. Since you’re starting an individual consulting business, your business name can be your personal name as a trade name or a business name . If you have a name that you want to use that feels more recognizable and eye-catching, make sure you factor the registration costs into your original budget.

If you need to design a logo, you can do that yourself or reach out to designers. The logo will help you start marketing to your target audience, whether that’s business owners or companies or individuals. If you want to consult in a certain industry, you should start building a list of contacts to reach out to when you’re ready to launch and take on new clients.

With all of this information ready to go, you can start on the administrative side of your business.

Before you start doing official business, you’ll need to register with your state’s Secretary of State as a sole proprietorship or as an LLC. You should also check to see if there are other legal requirements for small businesses in your state. If you are planning to grow the business, registering as an LLC will make it easier to track your business expenses for taxes. It can cost about $50 to $100 to register your business online, depending on the state.

If you’re starting a consulting business as a side hustle, it might be worth it to invest in a business to register your LLC for you.

Start an LLC Online Today With ZenBusiness

Click on the state below to get started.

Determining your rates also means determining what kind of services you want to offer. Consultants offer a variety of services. You can offer a wide range of support for a business, but do less of a deep dive. Alternatively, you can be hyper-specific in your expertise and go deep on a certain aspect of a company’s business. For example, if you’re an HR consultant, you can take a larger view of a company’s HR operations, or focus on their hiring practices for a specific department.

You should also consider if you want to take on short-term or long-term clients. Doing one-off consulting sessions is still a lot of work, even compared to long-term consulting. Your pricing strategy should reflect the amount of preparation you have to do. It also may depend on your industry to decide how you want to price your services: either a one-time payment, hourly rate or monthly retainer.

A consulting business needs a website so clients can find you easily. If a business is doing research into finding a consultant in your industry, you want your website to pop up for them. If you are familiar with SEO best practices , you can do this yourself, or hire someone to optimize your website.

Here are the best platforms for building a professional website:

• Squarespace: This platform is very user-friendly and has plenty of award-winning templates. In addition to great designs, it’s also affordable with all-inclusive plans starting at $16 per month. However, it does lack more robust customization options for more experienced coders.
• Wix: This all-in-one website builder offers a drag-and-drop site editor, making web design both easy and highly flexible. However, it’s a bit more expensive than Squarespace with plans starting at $16 per month.
• WordPress: The world’s most popular content management system, WordPress, is not the most user-friendly, though it is one of the most customizable and affordable options (as you only have to pay for web hosting for around $4 to $8 per month). It’s the best option for those who have very unique website needs or experience with the CMS.

Building a website can seem intimidating, but many of the best website builders make it easy for beginners to create a site without any experience or coding knowledge. However, keep in mind that websites do require ongoing maintenance, so you might want to hire a virtual assistant or work some time into your calendar to do regular website maintenance and updating.

Marketing a new business can be difficult, but being diligent about finding new marketing channels and leveraging connections will make it a lot easier. Try these simple and low-cost solutions to start marketing.

• Search engine optimization to rank on Google
• Online business directories, such as Google My Business, Yelp or Yellow Pages
• Pay-per-click advertising, such as Google Ads, Facebook Ads or YouTube Ads
• Subreddits for entrepreneurs or your industry
• Slack groups for freelancers
• Find local networking groups, such as local business associations
• Participate in industry networking events

Working on this yourself, in the beginning, will require a fair amount of time, but when your business grows, you might be able to hire a social media strategist or partner to work on finding business leads.

Where can a consulting business find government contracts to apply for?

You can look on this website that lists government agencies that take contractors and consultants .

How can a consulting business get clients using Fiverr?

Fiverr allows anyone to sign up and sell their services as a freelancer. A lot of companies looking for freelance writing, design or marketing work use Fiverr, so it would be a good place to do consulting for content strategy.

Is it possible to start a consulting business on the side?

If you are comfortable with working with a smaller number of clients and are realistic about your time, you can easily run a consulting business on the side. It’s important to be open with your clients about your time constraints to build trust.

What are some good fields to start a consulting business in?

The consulting business you start is going to be based on your strengths and skills, but some of the potential fields where you might enjoy some of the most success include public relations, publishing, human resources (HR) marketing, computer programming, career consulting, advertising and accounting.

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The blueprint for crafting your effective consulting business plan

Keith Rabkin Chief Revenue Officer for PandaDoc

• Copy Link Link copied

Ever tried to put up a tent blindfolded? Navigating the consulting world without a business plan can feel the same overcomplicated.

We created this guide to help you set a strategic, actionable plan on how to operate your early-stage consulting business.

We’ll help you define your services, set achievable and clear goals, and arrange strategies for growth.

So are you ready to pitch your tent with both eyes open?

Key takeaways

• A consulting business plan starts with defining your unique selling proposition (USP). Identify a niche and ideal client by conducting thorough market research and competitive analysis.
• Develop a 12-month marketing strategy with specific targets. Allocate 10-15% of projected revenue to marketing for optimal results.
• Realistically estimate your expenses and revenue based on billable hours/fees and retention rate assumptions.
• Use a proven template rather than starting from scratch to not overlook important elements of the plan.

What is a consulting business plan?

A business plan is a document covering all the aspects of your future consulting business in terms of achieving business goals.

In other words, this specific plan removes the guesswork from how one runs their consulting business.

In the upcoming sections, we’ll explain the key pieces needed to create your business plan.

Your consulting business plan should offer a detailed overview of your consulting firm.

Let’s briefly review the essential sections of the plan and what should be in each of them.

• Executive summary is a short overview of the main points of the document.
• Business overview highlights the mission, vision, history, and services offered by the consulting firm.
• Management team provides bios and expertise of key team members.
• Customer analysis defines target clients, their needs, and how the consulting service solves their problems.
• Industry analysis evaluates the landscape including growth, trends, regulations, and competition.
• Competitive analysis compares the consulting firm’s positioning and offerings versus competitors.
• Marketing plan outlines promotional strategies, lead generation, and metrics.
• Operations plan details the logistics of service delivery, staffing, resources, and customer service principles.
• Financial plan projects costs, revenue, cash flow, and profitability timelines.

Key steps for developing your consulting business plan

Building a thriving consulting business requires thorough planning and a keen eye for detail. Let’s walk through this journey step-by-step.

Step 1. Identify your niche and ideal clients

Kick off your business plan by diving deep into industry research. Look for sectors and trends where there’s a gap that your expertise can fill.

To validate the demand, consider surveying potential clients.

Once you’ve got a handle on that, create a detailed profile of your ideal client , considering factors like their company size, revenue streams, challenges, and objectives.

By the way, focusing on ideal buying personas in B2B (with all these fictitious names, bios, etc.) is one of the greatest sales mistakes, according to Corporate Visions’ findings and Gartner B2B sales research results.

Step 2. Analyze the competition

Understanding your competition is crucial. Examine competitor services offered, how they are marketed, and what they charge.

This is your chance to find your unique selling proposition.

Step 3. Set your rates and service packages

Following the actual industry norms to appoint your consulting fees. However, the price that you use should mirror both your expenses as well as the premium value that your expertise brings to your clients.

Let’s say you work out your overhead costs (utilities, office rental, equipment, etc.) to be roughly $50 per hour, while your hourly work value, which includes your experience and knowledge in this field, is $100.

So, your primary costs in total for an hour of consultation would be $150.

A standard practice in the consulting industry is to have a 100% markup rate on your primary costs.

Applying that rule to your scenario would mean doubling your total cost of $150, which brings your final hourly rate to $300.

Create bundled service packages that combine different services, such as business strategy consultation, market analysis report, and a follow-up action plan. You can offer these at a discounted rate compared to purchasing each service individually.

For example, Bronze is an entry-level package with initial consultation and some basic professional business advice.

Silver is a mid-tier package covering everything from the Bronze plus a detailed action plan for improving business operations.

Finally, the Gold package is a top-tier one complementing what’s in Silver with extended support and follow-ups.

Step 4. Create a marketing and client acquisition strategy

Outline a 12-month marketing strategy that includes a mix of content marketing, events, referrals, and lead-generation campaigns .

Set achievable targets for each quarter, focusing on metrics like leads generated, sales appointments set, and deals closed.

When it comes to budgeting, aim to allocate 10%-15% of your projected revenue or even more to marketing.

According to Gartner, the average startup spends 11.2% of its revenue on marketing.

Step 5. Calculate potential project expenses and revenue

You’ll need to account for various expenses, including staffing, office space, equipment, software, and marketing.

Don’t forget about professional services, travel, and other overhead costs.

On the revenue side, forecast your monthly earnings based on projected billable hours or fixed fees, and assume a client retention rate between 80%-90% .

Extend these projections to create 3 to 5-year profit and loss statements and cash flow forecasts.

Step 6. Plan for sustainability and growth

Your business plan shouldn’t just be a launchpad; it should be a roadmap for long-term growth.

Given that self-funding for growth beyond 20% annually is often unrealistic for most consulting firms, you’ll need a plan B.

One smart move is to establish strategic financial partnerships with investors, banks, or other financial institutions.

These partnerships can offer the capital injection you need to scale your services, break into new markets, or even acquire other businesses. 

More than just a financial lifeline, these partnerships can also provide invaluable business insights and open doors to new opportunities.

Step 7. Use an appropriate consulting business plan template

Having a consulting business plan template is like having a roadmap for your contractual relationships.

It ensures you don’t overlook key elements such as scope, payment terms, and legal considerations.

Consultant Business Plan Template

Used 4999 times

An example of a document outlining your strategy for launching or expanding your consulting firm is a Consultant Business Plan Template. The essential elements include a summary of the company, team, sector, rivals, target audience, and an operations and marketing strategy.

Customize it and review it with a legal advisor to ensure compliance.

Why developing a consulting business plan is so important

Let’s talk about the positive outcomes of planning. A well-defined consulting business plan…

…directs your business operations

A business plan defines your strategy and major goals, simplifying day-to-day decision-making and helping you focus on long-term objectives.

In other words, you know what to do next at any given moment of operating your early-stage consulting business.

…mitigates your risks

With a comprehensive business plan in place, you can anticipate and prepare for potential challenges, turning risks into opportunities.

…attracts investors

If you want to secure investments, the first thing venture investors or business angels will ask you for is (surprise, surprise) a business plan.

Not just any plan, but a detailed, convincing blueprint of your consulting business that highlights growth and potential returns.

Wrapping up

A well-crafted consulting business plan is essential for guiding your strategy, operations, marketing, finances, and growth.

Carefully working through each component will ensure you launch your firm following a clear plan on how to achieve success.

Using business planning platforms like PandaDoc that offer templates and tools can help streamline creating a professional plan.

The software also enables real-time collaboration so you can work seamlessly with colleagues and advisors.

PandaDoc is not a law firm, or a substitute for an attorney or law firm. This page is not intended to and does not provide legal advice. Should you have legal questions on the validity of e-signatures or digital signatures and the enforceability thereof, please consult with an attorney or law firm. Use of PandaDocs’ services are governed by our Terms of Use and Privacy Policy.

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BUSINESS STRATEGIES

How to create a consultant business plan

• Nirit Braun
• Oct 30, 2023
• 13 min read

When launching your consulting business, one of the essential first steps is crafting a well-structured and detailed business plan. Your consulting business plan is like a strategic playbook that lays out your goals, tactics and financial projections. It not only steers you toward success but also equips you to adapt and thrive in the dynamic world of consulting.

Keep reading for tips on how to build a strong business plan for your business. Use the template provided at the end to get started on your own plan.

Looking to kick off your consultancy business? Create a business website today with Wix.

Why create a consultant business plan? Top benefits to consider

A business plan forces entrepreneurs to thoroughly evaluate their business idea, target audience and competitive landscape. This process clarifies their vision and mission, ensuring that they have a clear understanding of how their consultancy will provide value to clients. A business plan helps you in the following ways:

Create a business blueprint : With a business plan in place, entrepreneurs looking to start a business can make informed decisions based on a solid foundation of research and analysis. They can choose the most effective strategies for marketing, pricing and service delivery, enhancing their chances of success. Your business plan can also be used to explain what type of business you'll start - whether that's an LLC, Corporation or something else. Learn more about how to start an LLC .

Secure funding : The cost to start a consultancy business can range from around $60 to several thousand dollars . For those seeking external funding, a well-developed business plan demonstrates credibility and professionalism. Investors and lenders are more likely to support a venture with a thought-out plan that showcases its potential for growth and profitability.

Set measurable goals : A business plan sets measurable goals and performance metrics, which is vital with this type of business . This allows entrepreneurs to track their progress, adapt strategies as needed and celebrate milestones along the way.

Want to remind yourself of the basics? Learn more about how to start a service business .

How to create a successful consultant business plan in 6 steps

In this section, we'll break down the key components involved in crafting a successful consultant business plan in six steps.

Executive summary

Business and domain names

Market analysis and research

Operations plan

Marketing and advertising plan

Financial plan

01. Executive summary

An executive summary serves as a concise overview of the consultant's business plan, providing a snapshot of the key components and the business' essence. It's usually the first section investors, lenders and stakeholders read, so it must encapsulate the business' value proposition, objectives, strategies and projected growth. To write a clear executive summary for a consultant business make sure to keep it succinct yet informative. Clearly state the purpose of the business, the services offered, the target market and the unique value proposition. Avoid technical jargon that may confuse readers.

Then you can mention the business' strengths, such as the expertise of the consultants, unique methodologies or specialized services. Emphasize factors that set your consultancy apart from competitors.

Briefly discuss the market need for your services and how your consultancy plans to fulfill it. It’s worth noting that strategy and management consulting, as well as technology consulting, financial consulting and HR consulting are in high demand . Highlight any trends or changes in the industry that your business can capitalize on.

Remember to include a snapshot of your financial projections, indicating expected revenue, costs and profitability. This provides a glimpse into the business' potential financial success.

Example of an executive summary for a consultant business

"XYZ Consulting is a boutique consultancy firm specializing in digital transformation for small and medium-sized enterprises (SMEs). With a team of seasoned professionals, we offer tailored solutions to help businesses harness the power of technology for growth. Our unique approach blends strategic consulting with hands-on implementation, ensuring tangible results. In a rapidly evolving tech landscape, XYZ Consulting is poised to be the partner SMEs need to thrive. Our financial projections forecast a steady growth trajectory, with a focus on achieving profitability within the first two years. With a proven track record and a finger on the pulse of industry trends, XYZ Consulting is well-equipped to guide businesses toward digital success."

02. Business and domain names

Knowing how to name a business is crucial for a consultancy venture and a key step before you register your business . It's the foundation of your brand and influences how clients perceive your services. With Wix , you can use a free business name generator or consulting company name generator as helpful tools for brainstorming unique and memorable names. Ensure the name reflects your expertise and the services you offer.

Similarly, the domain name for your business website is vital. It should be easy to remember, relevant to your services and ideally, match your company name. Check the domain's availability using domain registration platforms. Ensure the domain name aligns with your consultancy's focus and services. Generally, this means keeping it short and easy to spell and pronounce.

Learn more: How to make a consulting website

03. Market analysis and research

Incorporating a thorough market analysis within your consultant business plan is essential. Understand the competitive landscape, target audience and market trends. Research your competitors' strengths and weaknesses, pricing strategies and client base. This information will shape your business strategies and help you identify gaps in the market that your consultancy can fill.

04. Operations plan

The operations plan outlines the logistical aspects of your consultancy. It covers location, premises, equipment and staffing requirements. Determine whether your consultancy will be home-based, have a physical office or operate virtually. Define the equipment and software needed to deliver services effectively. Outline your staffing needs, including the roles and expertise required.

05. Marketing and advertising plan

Your marketing and advertising plan outlines how you will promote your consultant business. Identify the most effective strategies to reach your target audience. Consider content marketing, social media campaigns, networking events and speaking engagements to showcase your expertise. Emphasize how your marketing efforts will build brand awareness and attract clients.

You’ll need to develop a suite of brand assets to use in your marketing as well, starting with a company logo. You can use a free logo maker to get a professional logo in minutes.

06. Financial plan

The financial plan is a critical component of any business plan. It outlines how you will raise money for your business initially and provides a timeline for reaching profitability. Detail your startup costs, including equipment, marketing expenses and personnel. Present your revenue projections, taking into account different pricing models and growth scenarios. Highlight your break-even point and the strategies you'll employ to achieve profitability.

By addressing each part of their plan, entrepreneurs can create a robust business plan that guides them toward achieving their business goals and building a reputable consulting brand.

Consultant business plan examples

These templates illustrate two hypothetical consultant business plans, each tailored to a specific niche. These are just templates and should be adapted to your specific business goals and industry dynamics.

Consultant business plan template 1: XYZ Digital Consultants

XYZ Digital Consultants is a pioneering consultancy firm focused on digital transformation for businesses seeking to thrive in the digital age. Our team of experienced professionals offers strategic guidance and hands-on implementation to drive growth through technology adoption. With projected profitability within two years and a commitment to excellence, XYZ Digital Consultants is poised to lead businesses into a successful digital future.

Company and domain name

Company name: XYZ Digital Consultants

Domain name: xyzdigitalconsultants.com

Market opportunity: The rapid shift toward digital operations has created a substantial demand for expert guidance. Our analysis reveals a gap in the market for holistic digital transformation solutions tailored to the needs of SMEs.

Competitor research: We've identified key competitors and their strengths, which informs our strategy to emphasize personalized service and comprehensive implementation.

Location: Primarily virtual, with occasional in-person consultations as needed.

Premises: Home-based setup with access to modern communication tools.

Equipment: High-speed internet, latest software tools and virtual meeting platforms.

Staffing: Founder and lead consultant, supported by contract specialists as projects demand.

Content marketing: Regular blog posts on digital transformation trends, case studies and client success stories.

Social media campaigns: Active presence on LinkedIn and X to engage with potential clients and share valuable insights.

Networking events: Participation in industry webinars, seminars and local business events to showcase expertise.

Speaking engagements: Leveraging speaking opportunities at conferences and workshops to establish authority in the field.

Startup costs (equipment, website development, marketing materials): $15,000

Revenue projections (year one): $150,000

Revenue projections (year two) : $300,000

Break-even point: Achieved by the end of year one

Funding: Initial investment and savings from the founder

Consultant business plan template 2: LeadersEdge Consultants

LeadersEdge Consultants is a dynamic consultancy dedicated to leadership development and organizational excellence. Our experienced team offers customized programs that empower leaders to drive positive change. With a projected growth trajectory and a commitment to fostering impactful leadership, LeadersEdge Consultants is poised to transform organizations and elevate their success.

Company name: LeadersEdge Consultants

Domain name: leadersedgeconsultants.com

Market opportunity: Our analysis reveals a growing need for leadership development programs in diverse industries.

Competitor research: We've identified competitors' offerings and recognized an opportunity to provide a unique blend of coaching, training and strategy implementation.

Location: Virtual consultations, with the option for on-site workshops

Premises: Virtual office setup with video conferencing capabilities

Equipment: High-quality audiovisual tools, assessment software and learning platforms

Staffing : Founder will serve as the lead consultant, supported by certified leadership coaches

Customized workshops: Designing tailored leadership development programs for individual organizations.

Webinars: Hosting webinars on leadership best practices to showcase expertise and engage potential clients.

Thought leadership content: Publishing whitepapers, eBooks and video content on leadership topics.

Collaborations: Partnering with HR and talent development professionals to expand reach.

Startup costs ( making a website , training materials) : $10,000

Revenue projections (year one): $120,000

Revenue projections (year two): $250,000

Break-even point: Achieved within the first six months

Funding: Initial investment from the founder.

How much should you be charging as a consultant?

The amount you charge as a consultant will depend on a number of factors, including:

Your experience and expertise

The type of consulting services you offer

The value you provide to your clients

The market rate for consulting services in your field

In general, consultants charge between $100 and $500 per hour. However, some experienced and highly specialized consultants can charge upwards of $1,000 per hour.

To determine your consulting rate, you can use the following formula:

Consulting rate = Hourly rate * Value multiplier

Your hourly rate should reflect your experience and expertise, as well as the type of consulting services you offer. For example, if you have 10 years of experience and you offer specialized consulting services, you can charge a higher hourly rate than a consultant with less experience and who offers more general consulting services.

Your value multiplier should reflect the value you provide to your clients. For example, if you can help your clients to achieve significant results, you can charge a higher value multiplier.

Here is an example of how to use the formula:

Consultant: Experienced consultant with 10 years of experience offering specialized consulting services

Hourly rate: $200 per hour

Value multiplier: 2

Consulting rate: $200 per hour * 2 = $400 per hour

Can a consulting business be profitable?

Yes, a consulting business can be profitable. In fact, consulting is one of the most profitable industries in the world. According to a report by IBISWorld, the average profit margin for consulting businesses is 20%. This means that for every $100 in revenue, consulting businesses generate $20 in profit.

There are a number of factors that contribute to the profitability of consulting businesses. First, consultants are able to charge high fees for their services. Second, consulting businesses have relatively low overhead costs. Third, the demand for consulting services is high, and it's only expected to grow in the coming years.

Of course, not all consulting businesses are successful. Some consultants struggle to find clients or to charge high enough fees. Others may not be able to deliver the results that their clients expect. However, for consultants who are able to overcome these challenges, the potential rewards are great.

Here are some tips for increasing your chances of success as a consultant:

Specialize in a high-demand area of consulting. This will allow you to charge higher fees and attract more clients.

Build a strong reputation and network of clients. This will help you to generate word-of-mouth referrals and land new clients.

Market your services effectively. Make sure that potential clients know about your services and how you can help them.

Deliver high-quality results. This is the most important thing you can do to ensure that your clients are satisfied and that they continue to use your services in the future.

How much does it cost to start a consulting business?

The cost to start a consulting business can vary depending on a number of factors, such as the type of consulting services you offer, the size of your business and your location. However, in general, you can expect to spend between $10,000 and $50,000 to start a consulting business.

Here is a breakdown of some of the typical start-up costs for a consulting business:

Business formation: $100 to $1,000

Website and domain name: $100 to $2,500

Marketing and advertising: $500 to $5,000

Office equipment and supplies: $500 to $5,000

Professional liability insurance: $500 to $1,000

Other miscellaneous expenses: $500 to $5,000

Total start-up costs: $10,000 to $50,000

You can reduce your start-up costs by working from home, using free or low-cost marketing tools and purchasing used equipment. You can also start your consulting business part-time while you continue to work your full-time job. This will give you a chance to generate revenue and build a client base before you leave your full-time job.

If you need financial assistance to start your consulting business, you may be able to qualify for a loan from a bank or credit union. You may also be able to find investors who are willing to invest in your business.

Which clients to avoid and which to take on?

Here are some tips on which clients to avoid and which to take on in a consulting business:

Clients to avoid

Clients who aren't willing to pay your rates. If a client isn't willing to pay your rates, it's a sign that they don't value your services.

Clients who are unrealistic about their expectations. If a client has unrealistic expectations about what you can achieve, you're likely to set yourself up for failure.

Clients who are difficult to work with. If a client is demanding, rude or disrespectful, it's best to avoid them.

Clients who aren't a good fit for your business. If a client isn't in your target market or if their business isn't aligned with your values, it's best to decline working with them.

Clients to take on

Clients who are willing to pay your rates. This shows that they value your services and are committed to working with you.

Clients who have realistic expectations. This makes it more likely that you will be able to meet their needs and exceed their expectations.

Clients who are easy to work with. This will make the consulting process more enjoyable and productive for both of you.

Clients who are a good fit for your business. This means that they're in your target market and that their business is aligned with your values.

In addition to the above, here are some other factors to consider when deciding which clients to take on:

Your own skills and experience. Make sure that you have the skills and experience to help the client achieve their goals.

The client's budget. Make sure that the client has a budget that's sufficient to cover your fees.

The client's timeline. Make sure that you have the time and resources to meet the client's timeline.

Your gut feeling. If you have a bad feeling about a client, it's best to trust your gut and decline working with them.

It's important to be selective about the clients you take on. By avoiding difficult clients and focusing on good-fit clients, you can set yourself up for success in your consulting business.

Consultant business plan FAQ

What qualifies you as a consultant.

To qualify as a consultant, you need to have the expertise and experience in the area that you're consulting in. You also need to be able to communicate your ideas effectively and build relationships with clients.

How do you start off as a consultant?

How to make 6 figures as a consultant, how do you pay yourself as a consultant, do consultants pay their own taxes, want to create another business plan.

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Start a Consulting Business in 6 Steps [+Ideas for Your Venture]

Learn about the types of consulting and how to start a lucrative, successful consulting business.

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Published: 02/08/24

Did you know the strategy consulting market is expected to grow by $70.08 billion between 2022 and 2027? This is great news for those wanting to start their own consulting business this year.

A career in consulting may be a good fit for you if you’re passionate about helping others in your industry succeed and you are considered an expert in your career field. In fact, consultant jobs are predicted to increase by 11% from 2021 to 2031, making consultants more in demand than ever.

We’ve compiled this guide to dig deeper into the world of consulting and how to start marketing your own consulting business. Learn about the types of consulting and how to start a lucrative, successful consulting business.

Table of Contents

What is consulting?

How to start a consulting business in six steps, the 16 different types of consulting, how to grow your consulting business.

Consultants are experts in their field. They possess knowledge so valuable that someone else — an individual, department, or entire organization — is willing to pay for it. Consulting can include many activities beyond simply giving advice , including problem diagnosis, data collection, feedback, strategy-building, and implementation.

“The defining characteristic of a consultant is their talent. It’s an intrinsic capacity to look beyond the apparent, make connections that others might miss, and motivate people to take initiative and be confident,” says Hrair Tcholakian , founder of eksperts.net.

Sometimes, business leaders need a new set of eyes when approaching an issue. As a consultant, you can provide that unbiased perspective. Consultants and consulting firms are highly sought after for their fresh perspectives on a pressing business problem or challenge. Simply put, consultants work to make their clients more successful.

Consultant vs. Contractor

You may have heard the words consultant, contractor, and even freelancer used interchangeably. While all of these parties work with businesses and aren’t full-time employees, that’s where their similarities end.

• Contractors (including freelancers ) are self-employed workers that companies contract to provide services.
• Consultants, however, primarily offer assessments and their expert advice. They can be self-employed or employed by an outside consulting firm.

However, if, as a consultant, you were asked to provide a service or deliverable, you could be hired into a contractor-type role.

Now, let’s explore how to begin your own consulting business.

• Assess your skills and strengths to choose your niche.
• Analyze your market needs and pain points.
• Develop your brand, website, and service offerings.
• Open your business.
• Market your business to attract new clients.
• Stay organized and scale.

Are you specialized in a certain field or niche industry and believe you could offer quality advice to others? You may consider opening your own consulting business. Here are six steps to follow to start a consulting business that helps both you and your clients succeed.

1. Assess your skills and strengths to choose your niche.

A good first step to starting your consulting business is to brainstorm and define which valuable skills and strengths you have that make you a great consultant. Ask yourself these questions:

• What makes you an expert?
• What do you love to do and talk about?
• If you had to stand in front of a classroom and teach any subject, what would that be?
• What do your friends, family, and coworkers ask for your advice on?

I consider myself to be an expert in content marketing, so during this step, I would explore which skills I’m often asked about, such as SEO, website and user optimization, and more. Consider what skills were key in getting you hired in the past, as these could be your most lucrative offerings.

2. Analyze your market needs and pain points.

Once you establish your consulting niche, you should better understand what industry and market you’ll be targeting.

Narrowing your market as a consultant allows you to understand your potential clients’ needs, challenges, and pain points. This can help clarify how you can use your skills to provide solutions.

For example, content marketing is a wide field, but my niche experience is in tech content marketing, like SaaS companies and cybersecurity firms. I can position myself in a niche industry because this is where I will do the most good.

Just as you specialize in a certain skill set as a consultant, you should also specify what services you provide for your clients. This information can also help you better market to clients, which we’ll talk about below.

3. Develop your brand, website, and service offerings.

Next, create the external-facing components of your business, including your website, branding , and services. These resources can help clients distinguish you from competitors.

Whether you identify your business with your name or with another name, you should give it an official name and website to boot. Ask yourself what you bring to the table that makes you so valuable, and highlight this offering.

Another important part of this step is outlining how much your consulting costs. Be clear about what services are included in your price.

4. Open your business.

This step is more complicated than flipping a proverbial sign from Closed to Open.

First, consider the legal structure of your business. Legitimizing your business gives you credibility and direction when it comes to taxes, staffing, and other legal details.

Next, consider what tools you need to conduct business and connect with clients. These might include tools to help find new clients and jobs — like a LinkedIn membership — and video conferencing software like Zoom or Skype.

In my experience, the more hype you can generate around your new business, the better. Ask your friends, LinkedIn contacts, previous clients, and others to share your new business. Consider offering a discount on future services if they do.

At this stage, you should also open a business bank account, invest in an accountant (and eventually an assistant), and order business cards with your branding and information.

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5. Market your business to attract new clients.

Now that you’ve opened your business, it’s time to grow . Marketing yourself correctly is key to reaching new clients.

Consulting marketing can adopt a variety of marketing methods:

• Podcasting .
• Speaking and teaching.
• Social media marketing.
• Print or digital advertising.
• Cold calling and emailing.

Regardless of how you promote your consulting business, invest in consulting marketing methods that will get you in direct contact with your potential clients.

Methods like blogging, podcasting, and social media marketing don’t necessarily draw a direct line to new revenue, but they are powerful for growing awareness and establishing expertise. Content marketing is often a marathon, not a sprint, so be sure to create a consistent publishing schedule.

Once you get in front of potential clients, have an established elevator pitch and client proposal template ready to go. Half the consulting “battle” is providing advice. The other half is selling your advice in the first place.

As you grow your client base, use a CRM like HubSpot’s all-in-one CRM platform (which comes in a free version for small-to-medium businesses or a paid version for enterprises). It can help you keep track of client information as well as the context of your relationship with each client.

6. Stay organized and scale.

As you grow and master your consulting business, stay organized and consistent. High-quality results are the best way to incite referrals from previous clients — and referrals can be your best source of new sales .

In fact, as you build successful relationships with clients, don’t be afraid to ask for referrals for new leads.

Once a month or so, sit down and analyze your consulting business. Look at your client list, software tools, and other business practices. Analyze what’s working and what’s not.

Understand where you can cut extra effort and resources to ultimately save money. Lastly, subscribe to industry trends to keep your business relevant to the challenges and trends your clients face.

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Another source of great blog content is your client base. Pay attention to what issues or questions your clients face and gather feedback about what information would be helpful to write and share.

In the same vein, blog content can also serve as sales enablement content — sharing a popular blog post or two with potential clients can help them understand why they should hire you.

4. Share thought leadership content.

Like starting a blog, publishing thought leadership content can help you establish your authority. Consider platforms like Medium that already have an audience. Publish your most authoritative, data-driven content on there to boost your brand awareness.

You can also use tools like HARO to connect with journalists and bloggers looking for expert quotes, anecdotes, and stories for their content. Respond to queries to get your voice featured as a thought leader in your consulting niche.

5. Network and make new connections.

Between social media, dedicated Slack channels, and online masterminds, you are the only thing standing in your way of making new connections and friends online.

Networking in person is pretty straightforward. But networking online can be tricky. Thankfully, with today’s technology, there are countless ways to network and make new connections.

One of my favorite spots to network is on Twitter. It’s the easiest platform to engage with folks and start interesting conversations. I’m also reminded of old connections that I can revive with a short Tweet or email.

Angelique Rewers , founder of Premier Global Community, argues that clients need a compelling ROI story.

“Employee experience is reportedly on the budget chopping block this year, as are a lot of other things. That means every dollar companies invest needs to go a long way. Decision makers need and want to see big, visible dents being put in their problems quickly, and they want to see those results last for longer than sizzle on a steak,” Rewers says.

When you network, you need to share what exactly organizations will get from their investment in you.

Test a few platforms and programs and see which one helps you get connected, attract clients, and build a community.

Start Consulting Today

Consulting may be a fascinating, lucrative career, but it’s also a mindset. Successful consulting businesses begin with an individual or team of experts passionate about helping others.

Regardless of your firm’s size, keep your passion and expertise centered, and you’ll always find success. Top consultants are great at planning, presenting, and marketing their services. Start your consulting business plan by downloading our free consulting templates below.

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Consulting Firm Business Plan Guide

Starting your own business, or scaling up is intimidating. we’re here to break it down piece by piece so you can create your very own plan., in this free , you will learn:.

• Why Create a Consulting Firm Business Plan?
• The Key Components of a Business Plan
• How to Use a Business Model Canvas
• How to Bake Productization Into Your Business Plan

You’re in the right place if…

○ You have an idea for a consulting firm, and you’re ready to take the next step ○ You’ve started a business, and you need focus and direction

○ Your consulting company needs to bring in partners or funding

Starting a consulting business is no small task, so setting a clear action plan is essential. This comprehensive guide will give you a step-by-step breakdown of how to create a consulting business plan, why you need one, and how a business model canvas can help you along the way.

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How To Start A Consulting Business In 2024 (6 Steps & Study)

This is the ultimate guide — with data — on how to start a consulting business in 2024.

By the end of this guide, you’ll know how to turn your skills and expertise into a profitable and successful consulting business .

Let’s dive right in.

(If you want to read our “ How To Start A Consulting Business Study “, click here to scroll down to that section)

Step 1: Choose Your Consulting Business Model

First, let’s define the term consulting.

Consulting is “the business of giving expert advice to people working in a professional or technical field.”

For example, I’ve spent over 21 years being a consultant.

I’ve spent 10,000+ hours on marketing , sales , fees , proposals — and everything else that consultants do.

So, I’ve accrued experience that enables me to give expert advice to people in the consulting field.

If you can provide advice that helps business-to-business (B2B) or non-profit organizations based on your past experience, you can consult.

People and organizations will pay you for your advice to help them get results.

Results like more sales, a lower employee turnover rate, a risk-free software project, help with executive decision making — the list goes on.

But before you start consulting, it’s important that you choose your consulting business model first.

Why should you do this first?

At Consulting Success®, we believe that your consulting business should support your lifestyle — and not the other way around.

That means that you should build the type of business that helps you live the lifestyle you want to live.

I’ve seen too many people end up building consulting businesses that trap them into a lifestyle that’s just like their 9-5 job…or worse.

To avoid that, you’ll aim at the type of consulting business you want by choosing the right model for you.

Watch the video below for an introduction to the 4 proven consulting business models :

Let’s talk about each model.

The Solo Consultant Model

As a solo consultant, you work closely with your clients and complete the project work yourself.

For example: Martin Krumbein is a strategy consultant who helps companies implement the right strategy for growth, enabling them to scale.

The solo consulting model is great for you if you want a lean, profitable, and flexible consulting business — a “lifestyle” business.

The solo consulting model is not right for you if you intend to sell your business (because you are the face of it), and if you don’t like the fact that if you stop working, it will be challenging for you to generate revenue.

Six-Figure Blueprint

The consulting firm model.

In the consulting firm model, you are responsible for running the firm instead of just working on client projects.

For example: Amanda runs an HR consulting firm , where she helps technology companies with culture, hiring, and talent retention. Instead of working on client projects, she manages a team of consultants who are implementing projects for their clients.

The consulting firm model is great for you if you don’t want to be focused on the “day-to-day” work, want to build a business that runs without you, and would like to sell it one day.

The consulting firm model may not be the right fit for you if you don’t like managing people, don’t like the idea of a lower profit margin, and if you would feel stressed about making payroll.

The Productized Consulting Model

The productized consulting model is where you turn your expertise into a “ productized service ” — a repeatable series of steps that deliver a predictable outcome for clients.

For example: Kristen’s provides brand consulting for food and beverage brands. After years of delivering custom branding projects, she’s turned her expertise into a process. She’s branded this process, has put a fixed price on it, and delivers that instead of custom branded projects.

The productized consulting model is great for you if you want to build a business that scales , you want to create a saleable asset, and you want to remove yourself from the day-to-day work.

The productized consulting model might not be a great fit for you if you want to work on new projects or you don’t like managing or training people to deliver your productized service.

It also takes years of experience and delivering custom projects before you’re ready to turn it into a repeatable process that delivers a predictable result.

The Hybrid Consulting Model

The hybrid consulting model is a mixture of the previous 3 models.

You pick and choose what you like about the other models and combine them into your own unique hybrid.

For example: Our business, Consulting Success®, is a hybrid consulting business. We offer a digital course, Momentum , and a training program, the Clarity Coaching Program that includes personalized coaching and consulting with it.

The hybrid model is ideal once you’ve been running your consulting business for a few years. After a few years, you’ll know what you like, what you don’t like, and can start to customize your business model into what works best for you and your clients.

After reading those descriptions, examples, and pros & cons, which model excites you the most?

Remember: you can always change your consulting business model later.

But it helps to get clear on the type of consulting business you’d like to build from the start.

With that, let’s move on to the next step and think about your ideal client.

Step 2: Get Clear On Your Ideal Client

Who will your consulting business serve?

This is one of the most important questions you’ll answer to start a consulting business.

And it’s one that many people skip over.

As a result, it’s very hard for them to attract clients, price their services, and win consulting projects.

Pay particular attention to this step and take the time to get it right.

Watch the video below to learn why being crystal clear on your ideal client is critical to your consulting business:

Here’s how to think about choosing your ideal client.

The “Big Fish In A Small Pond” Mindset

Imagine that you’re dealing with severe back pain.

You’re looking for a physiotherapist who can help get rid of your back pain — so you can get back to living a healthy, active lifestyle.

So, you begin searching for physiotherapists to help solve your problem.

You find one clinic called “ActiveFit Physiotherapy.” They’re a generalist physiotherapy clinic that helps people with all types of pain.

After that, you find a clinic called “SpineExperts Back Pain Specialists.” They’re a clinic that specializes in helping people with their back pain.

Given your specific problem — your back pain — which clinic draws your attention?

Which one are you most likely to attend?

You’re more likely to go with SpineExperts because they speak to your exact problem.

It feels like they are talking directly to you — your pain, your problem, and the results that you want.

This example shows how important it is to get specific on who your ideal client is.

As a consulting business, you provide your expert advice to people or organizations.

Who are those people or organizations, exactly?

The more specific this “who” is, the more your business will stand out to them.

Without standing out, your ideal clients won’t pay attention to your messaging and content (which is marketing).

They’ll be less receptive to having a call with you about how you can help them (which is sales).

To start a consulting business, you want to start by being the big fish in a small pond.

You’ll stand out more, garner more attention, and become an expert faster.

It will make it much, much easier to get clients. And clients are what you need to start a consulting business.

So how do you actually figure out who your ideal client should be?

Brainstorm & Write About Your Ideal Client

The next step is to brainstorm about the niche that you’d like to serve in your business.

A niche is an industry or type of client.

For example, Nic Campbell works with nonprofit and philanthropic organizations.

Jason Fearnow of Prime Contract Solutions works with mining companies.

Husain Shekhani of Ultrasonic Advisors works with companies in the ultrasonic device industry.

None of these consultants target “businesses” or even “small businesses.” These are far too general.

Instead, they serve a specific niche.

To start a consulting business, you must pick your niche.

How do you actually do that?

In our Clarity Coaching Program , we instruct clients to use the Niche Scoring Method.

Here’s how it works.

Pick a couple of niches that you’re interested in serving.

If you can’t think of any, pick the industries that you’ve worked with before. What industry does the company you work for now belong to? What about companies you’ve worked with in the past? Or, how about companies you applied to work at?

Once you’ve picked out a few of these industries, score them on the following factors on a scale of 1-5 — with 1 being weak, and 5 being very strong:

• Experience : How would you rate your experience with this niche?
• Expertise : How would you rate your status as an expert within this niche?
• Results : How would you rate your confidence that you can deliver results for this niche?
• Potential : How would you rate this niche’s growth and how willing they are to hire consultants?
• Interest : How would you rate your interest in this niche?
• Access : How would you rate your ability to speak with ideal clients in this niche?

Then, you add up the total scores for each niche.

Pick the one with the highest score to start with.

And pay attention to the “Interest” score.

You’ll enjoy your work more if it’s an industry or niche you are passionate about helping.

You can always change your niche later. But if you want to start a consulting business, you must pick a niche, and then go on to the next step.

Once you’ve made your selection, you’ll start talking to people about the potential of this niche.

Validate Your Ideal Client Potential

Picking your niche is the first step.

And now, it’s crucial that you validate your niche.

By validate, I mean going out and talking to people in that niche and learning about their problems and results that they desire in their organization.

People pay consultants to solve their problems and help them get their desired results.

Instead of guessing what those are, you validate your niche’s potential by asking them about these problems and desired results.

Use a tool like LinkedIn Sales Navigator to make a list of 10-20 ideal clients — people in the industry you’d like to serve.

Then, send them a connection request. In your connection request, send a message that introduces yourself, and that you’re connecting with people in your niche.

For example, if your niche is “Financial Services”, and you are connecting with Andrew, a CFO at a financial services company, you might say:

“Hi Andrew, you do great work at COMPANY NAME — would be great to connect with another person in the INDUSTRY NAME space.”

Notice how you’re not pitching anything like most people do.

You’re simply mentioning the person’s company, and that you’d like to connect with people in a similar space.

Tweak this example so that it suits your style.

The next step is to ask them a question. What are they working on? What’s new with their company?

Ask them something you are genuinely curious about.

If they are receptive and open to talking, you can ask them for a 5-10 minute call to learn more about that.

What you’re trying to do on this call is to learn about the industry — the problems they have, the type of projects they work on, and the results that they are working towards.

And if they have the types of problems that you’re interested in, can solve (or have solved before), then that is evidence that you’ve found a good niche to target.

Go and set-up these short, introductory calls with 10 ideal clients. Take notes on the call and record their feedback.

After you’ve done 10 calls, review your feedback.

Is this a niche that has problems that you have experience solving?

Is this a niche that works on the types of projects that you can deliver?

Would you enjoy working with this niche?

You want to select a niche where you can answer “Yes” to the questions above.

Now, reaching out to connect with ideal clients and then asking them for a call might scare you or make you uncomfortable.

If starting a consulting business was easy, everyone would do it.

To start a consulting business, you’ll have to embrace this discomfort.

You’ll have to take imperfect action.

Reaching out to prospects and calling them is a big part of marketing and sales, which we’ll get to later on in this article.

If you can’t do that, then you might be more comfortable sticking with a 9-5 job.

However, if you make your outreach more about your prospect instead of about you or your services, you’ll be surprised about how willing they are to connect and speak with you.

So, who’s your ideal client?

What industry are they in?

What’s their job title?

How big is their company, and where are they located?

By brainstorming and validating your ideal client, you’ll write specific answers to these questions.

Your ideal client — who you serve and add value to — is the foundation of your consulting business.

Once you’ve got that foundation down, you’re ready for the next step.

You’ll write messaging that attracts these ideal clients to you.

Step 3: Write Messaging That Attracts Clients

I once had a friend who was looking into joining a weekly yoga class to work on his flexibility.

He worked a desk job, and outside of some running, he didn’t do a lot of stretching.

However, he was intimidated by most yoga studios.

They looked as though they were all for experienced yoga practitioners.

On their website and their advertisements, they showed off impossible-looking poses, ridiculously fit instructors, and all kinds of spiritual mumbo-jumbo.

He almost gave up his search.

But then, he came across one Yoga studio that spoke to him:

“Yoga For Stiff Guys — Get More Fit & Flexible With Our Relaxed Classes For Beginners”

This message attracted him like a magnet.

It spoke to what he wanted — yoga for beginners — but also who he was: a stiff guy.

That’s what good messaging does.

It makes your ideal client feel as though your marketing is speaking specifically to them.

It makes them take interest in your business and want to learn more.

Watch the video below to learn more about creating a magnetic message that attracts clients :

In this step, you’ll learn how to put together your magnetic message — and how to put it on display so that your ideal client starts to notice you.

Problems/Action/Results

Your ideal clients have problems they want to solve.

You, as the consultant, take actions to solve those problems.

As a result of those actions, your expertise creates results for your clients.

Problems, Actions, and Results are essential components of a magnetic message.

For example, let’s say you’re a sales consultant who helps enterprise software technology companies.

• Problem : Your ideal client’s sales team is performing poorly.
• Action : You offer a 6-week sales training program.
• Result : On average, your program increases the sales team’s performance by 33%.

Consultants — especially beginners — tend to focus too much on the actions.

But if you really want to get the attention of your ideal clients, focus on results.

Your ideal client wants results, not just actions.

Do this exercise now.

Write down 10 problems that your ideal client has.

Write down 10 actions you can take to solve those problems.

And then write the result of each of those actions.

If you’re unsure of what problems they have, then you haven’t done enough validation from the previous step. That’s where you learn about the problems your ideal client is facing.

By writing down problems, actions, and results, you have the building blocks of a magnetic message.

Now, we’ll put these blocks into a formula.

The “Magnetic Messaging Formula

We designed the “Magnetic Message Formula” to help you write a simple, effective message to draw the attention of your ideal client.

Here’s how it looks:

I help [WHO] to [solve WHAT problem] so they can [see WHAT result]. My [WHY choose me]…

Inside the square brackets are your “variables.”

You fill them in with the right words to match who your ideal client is, the problem you solve for them, the results you create for them, and why they should choose you.

For example: I help enterprise software companies with underperforming sales teams so that they can boost sales and revenue. My 10 years of experience and 6-step program has helped over 20 clients boost their sales by an average of 33% in 6 months.

• WHO : Your ideal client (ex: enterprise software companies).
• Solve WHAT problem : The problem that you solve for your ideal client (their sales team’s underperformance).
• See WHAT result : The result you create for your ideal client (ex: boost sales and revenue).
• WHY choose me : Why your ideal client should choose you (ex: 10 years of experience and 6-week program has helped over 20 clients boost their sales by an average of 33% in 6 months).

The Magnetic Message has everything you need to draw the attention of your ideal client.

Its purpose isn’t to win the sale. It’s to simply get them interested in you and want to learn more.

Use the example above to write your own Magnetic Message.

Your first message won’t be perfect. Instead, aim for “good enough.”

You’ll make it better once you make it public and start gathering feedback.

Applying Your Magnetic Messaging

Once you’ve written your Magnetic Message, it’s time to make it public.

It won’t draw the attention of your ideal clients unless you’ve put it in places where they can see it.

First, put it in your email signature.

That way, everyone you email will be aware of what you’re doing, who you’re serving, and how you can help them.

This is great for when you reach out to your ideal clients. It’s also great for creating referral opportunities.

You’ll interact with many people who don’t need your consulting service — but they know someone who might.

Second, put it in your LinkedIn profile.

Make your magnetic message your tagline.

Unlike your job title or the type of consultant you are, your magnetic message is more about your ideal client.

It’s about what you can do for them and the results you can create for them.

If ideal clients see your tagline, you want them to take interest and click to read your profile.

Finally, you want to put your magnetic messaging into your consulting website .

It should be one of the first things your ideal clients read when they visit your consulting website’s homepage.

And throughout the website, you back up your magnetic message with articles, testimonials, case studies, and other forms of content that demonstrates your expertise.

Your magnetic message won’t do you any good if it’s on a piece of paper in your drawer.

Put it out there and make it work for you.

Ask people to give you feedback.

Keep making it better and better until your ideal clients can’t help but want to learn more.

Once you start getting the attention of your ideal clients, you’re ready for the next step, creating your strategic offer — and pricing it.

Step 4: Create & Price Your Consulting Offer

By this point, you’ve chosen your consulting business model, gotten clear on who your ideal client is, and have written messaging that attracts that ideal client to you.

Now, you need to create and price your strategic consulting offer.

Remember: Your ideal client has a series of problems.

You, the consultant, have the expertise and experience to carry out actions to solve those problems.

As a result of your actions, you’re able to create your client’s desired results.

Your strategic offer is those actions you take to create your client’s desired results.

And your consulting fees are what your ideal clients must invest for you to work with them and achieve their desired result.

Creating and pricing your offers is a very nuanced topic. There are strategies for beginners and for more advanced consultants.

We’ll focus on beginner and intermediate strategies for now.

If you want to learn more about advanced strategies like value-based pricing , discovery offers , and retainers , check out our Momentum or Clarity Coaching Program .

Let’s start with a popular topic: setting your consulting fee .

Set Your Consulting Fees

Why do you pay for products or services?

Because you want to get a result.

If you purchase a massage session, you want your body to feel better.

If you purchase accounting software, you want an easier time managing your money.

Now, how much you invest depends on many factors.

• How painful is the problem?
• How reliable is the product or service?
• How will getting this result impact your life?
• How much money do you have to invest in it?

Your clients are paying for your service because they want a result.

And much they are willing to pay depends on these factors.

Consultants in our programs regularly charge $25K, $50K, or even $100K+ for a single project.

That might sound crazy to you.

But if you think about the results their clients are getting, these prices become much more understandable.

As a beginner, the easiest way to set your consulting fee is by using the hourly method or the project-based method.

(See our consulting fees guide for a more in-depth tutorial on how to set your fees using these methods.)

With the hourly method, you charge your client by the hour.

It’s a good option for your first few consulting projects.

For example, let’s say you earn $80 dollars per hour in your day job.

Take your hourly fee and double it for your consulting projects.

You’ll charge at least $160 for consulting.

As a new consultant, you’re not working 40-hour weeks with your clients.

You have to spend just as much time (if not more) to actually go out and win business.

Your fee must account for this.

If it doesn’t, you won’t be able to do your best consulting work.

Clients are happy to invest higher fees if it means working with an expert and feel certainty about getting the results they want.

With the project-based method, you charge your client a fixed price.

It’s a better option than hourly because your clients know exactly how much they are paying upfront.

With the hourly method, they don’t have this same certainty.

For example, let’s say your consulting service will take 30 hours to deliver.

Take your hourly rate, and times it by 30.

$160 x 30: $4800.

Then, times that by 1.5.

Projects will take longer than estimated when starting out.

This multiplier helps account for revisions, scope creep, and any add-ons.

Once you’ve chosen a pricing strategy and set your fee, you’ll begin to create some options for your clients.

Create Three Options

Buyers like options for getting their desired results.

And when you offer them options, their thinking shifts from “Should I use you” to “How do I use you.”

So now, you’ll create three options to help your clients get their desired result.

NOTE: You will customize these options after speaking with each ideal client. You design your options to help your client get the specific results they want.

By having some stock options, you have a foundation.

It will be much easier for you to craft and customize your offers when you aren’t working from scratch.

Here’s how to think about your three consulting offers.

Option 1 – $

• Basic offer
• Minimum effort required
• Provides value
• Lowest investment

Option 2 – $$

• Helps them get their result quicker than option 1
• Provides more value than option 1 (ideally, without having to spend more time)
• Highest investment

Option 3 – $$$

• If money isn’t an issue
• Best results
• Shortest time to result

For example, let’s say you’re a marketing consultant who serves accounting businesses.

Your client, Acme Financial Services, wants to win 3 new clients per month.

Each client is worth $500 per month recurring revenue to the client.

You offer her client 3 options:

Option 1 – $6000

• Brand positioning overhaul
• Website messaging audit
• Direct outreach sequence

Option 2 – $15,000

• Website content strategy
• LinkedIn content + outreach plan

Option 3 – $30,000

• Search engine optimization
• Lead-magnet development & implementation
• Direct mail campaign

Notice how as the options increase in price, the value for the client increases.

The more they invest, the quicker they get their desired results, and the more certainty they get about achieving those results.

Think about it this way: your offer is a series of actions you take to deliver your client their desired result.

By offering multiple offers, you give the client about how they’d like to get their desired result.

Next, we’ll “brand” your offers and make them more intriguing to your ideal client.

Brand Your Offer

You don’t just offer “consulting.’

You offer more sales, increased efficiency, cost savings, stress reduction, etc.

So it’s important that your consulting services reflect that.

Branding your offer means to make them more memorable, unique, intriguing — and easier to sell.

No clients will be excited about a “sales workshop.”

But a 1-Day Sales Revolution Workshop?

That’s going to get people’s attention.

But how do you come up with a branded name for your offer?

Start by looking at your Problems/Actions/Results — specifically, your results.

Like a good headline, you want to include the result your clients want in the title of your offer.

For example, if your consulting services increase sales, then you want to incorporate that into the name of your offer.

Then, think about the format in which you deliver your consulting service.

Is it a workshop? Ongoing consulting? A bootcamp? One-off?

Add the format to the title as well.

Then, you’ll want to add a power verb to it.

Power verbs are action words that add color and force to your offer.

So, if you help your clients increase their sales by 33%, then use a word like “revolution” instead of “increase.”

With these three steps in mind, you’re ready to start brainstorming your offer’s name.

Here’s the formula: result you create + power verb + how you deliver it.

Example: 1-Day Sales Revolution Workshop.

Have some fun with this one.

Make it eye-catching. Make it original. Make it reflect your personality and style.

That’s what branding is all about — attracting the right people for you and your business.

Once you’ve created a few consulting offers, you’re ready to begin the marketing process.

It’s time to tell the world what you’re up to, and how you can help your ideal clients.

Step 5: Rev Up Your Marketing Engine

Early on in your consulting business, you can’t expect your ideal to come knocking on your door and asking to work with you.

You’ll have to find and approach them.

This is what marketing is for consultants: getting your ideal clients to know you, like you, and trust you.

When they know you, like you, and trust you, they’ll want to have a conversation with you about how you can help them.

At this point, you’ll start putting all of your work to the test.

Marketing is a complex topic — but in this step, we’ll make it easy for you to start reaching out and generating conversations with your ideal clients.

The Marketing Engine Mindset

Should you be on Instagram?

Is YouTube the way to go?

What about paid Google or Facebook ads?

There are thousands of ways to get the attention of your ideal clients.

However, most of these are shiny objects and tactics.

Some of them work, some of them don’t.

But if you don’t focus on what actually creates conversations with your ideal clients, you’re stuck in “no-mans land.”

Here’s what you want to focus on with your marketing:

1. Outreach : reaching out directly to start having meaningful conversations with your ideal clients.

For example, a direct LinkedIn message or email sharing valuable content with an ideal client to add value to their lives — and to get them interested in what you offer.

2. Follow-up : following up with ideal clients and adding more value.

For example, sending a direct mail to them — something they would find interesting, meaningful, unique (like a case study or white paper), and prompts them to reach out to you to learn more.

3. Authority-building : Publishing content to position yourself as an authority and to support your outreach/follow-up efforts.

For example, using your consulting website to publish articles that help your ideal clients.

If you combine outreach, follow-up, and authority-building, your marketing will be effective and fulfill its purpose: to build relationships with your ideal clients and to create conversations with them.

Now, reaching out to ideal clients might sound intimidating to you.

But this exercise will help.

Magic Number Exercise

People who write down their goals are much more likely to achieve them.

If you know your monthly revenue target, how much your average project is worth, and how many conversations with ideal clients it takes to win a project, you can be VERY specific on what it would take to reach your monthly goals.

For example, let’s say you want to make $50K per month in your consulting business.

Your average project is worth $25K.

And 1 out of every 4 conversations with an ideal client leads to a project.

That means you need to win 2 projects per month.

That’s 8 conversations with ideal clients per month — or, 2 conversations per week.

Now, the question is…

What are you doing TODAY to have 8 conversations this month?

We’ve created a simple spreadsheet for you to do this exercise and plug in your numbers:

Magic # Exercise Spreadsheet

Click File > Make a copy to save a copy of the spreadsheet for yourself so you can adjust the numbers.

This exercise makes it crystal clear as to what you need to be doing to reach your monthly revenue target.

It’s all about having more meaningful conversations with your ideal clients.

Now, how do you actually reach that number of conversations?

That’s what we’ll cover next.

Daily/Weekly/Monthly Plan

You need a plan — a daily list of activities — that will help you create X number of conversations with your ideal clients.

Remember your three key marketing activities: Outreach, Follow-Up, and Authority-Building.

You should be doing Outreach, Follow-Up, and Authority-Building EVERY DAY.

Early-stage consultants will spend more time reaching out to clients and following up with them.

Writing content to build authority is a longer-term strategy, whereas outreach and follow-up can create conversations very quickly.

You need to wake up each day and know exactly what to do every day in order to hit your numbers.

Doug Nelson , one of our Clarity Coaching clients, put his magic # everywhere around his home.

His day wasn’t finished until he had his required number of conversations with ideal clients.

As a result, he grew his consulting business to over $2M dollars.

Here’s a sample daily plan you can use to start your Marketing Engine:

• 8:00 AM: Start your Marketing Engine outreach in the morning
• 8:30 AM: Follow up with any potential clients from the previous day
• 9:00 AM: Make warm follow-up calls
• 10:00 AM to 2:00 PM: Client work
• 2:00 PM: Marketing Engine conversations/Authority Building
• 3:00 PM to 4:00 PM: Client calls and meetings
• 4:00: Daily review (focus on the most direct path and stage of your marketing maturity)

If you follow this plan, you’ll be reaching out to ideal clients, following up with ideal clients, and creating content for your ideal clients — every day.

This is what it takes to reach your magic # and hit your revenue goals.

With your marketing engine up and running, ideal clients will start scheduling calls with you.

They’ll want to learn more about your offers and how you can help get them results.

This brings us to the final step of starting your consulting business:

Having meaningful conversations with ideal clients — and winning consulting projects.

Step 6: Generate Meaningful Conversations (& Win Your First Consulting Project)

You’ve created your consulting offers .

You’ve started up your marketing engine.

What’s the sign that it’s all working?

Your ideal clients are receptive. They want to learn more about how you can help them.

Of course, you help them through your strategic offers.

But how do you bridge the gap?

How do you take someone who’s interested in your services to say “yes” to your offer and send you the check?

That’s where sales come in.

Just the word “sales” might make you feel icky.

But in consulting, “sales” take on an entirely different meaning.

The Truth About Consulting Sales

When people who are uncomfortable with selling think about sales, they think about the loud, aggressive car-salesman who doesn’t care about the customer.

They just want to “close.”

The good news is that effective selling in consulting takes the opposite approach.

As a consultant, sales is about having a meaningful conversation with a buyer to learn about their situation and needs.

If you help improve their situation and add value, then you can tell them about your offer.

You’re not trying to “close.”

Instead, you’re trying to help the client get clear on their desired situation, what’s holding them back — and then (and only then) if you can help, you make them an offer.

So, what do you ask a client to have a meaningful, valuable conversation that leads to the sale if the fit is right?

Meaningful Conversation Sales Framework

To figure out if there’s a fit between you and an ideal client, you have a conversation with your ideal client that’s about their business, their goals, and their challenges.

This conversation is meaningful but it prompts the client to get crystal clear about the problem they are facing, where they want to be, and what’s holding them back.

If your expertise can help solve those problems and get them to where they want to be, then you introduce your offer.

We’ve created the Consulting Sales Conversation Framework, which is designed to create three outcomes:

• The client accepts your offer on the call
• The client says they will review your proposal at an assigned future date
• The client says no to your offer.

Here’s a loose outline of the framework.

• Part 1: Establish rapport. Ask your client a few questions about where they are from and what they are up to this week.
• Part 2: Set the agenda. Give them an outline of the meeting, that you’ll explain your offer if there is a fit, and confirm that it sounds good to them.
• Part 3: Learn about their current business and important details. Ask them questions about their problems, why it’s important to fix, and the impact it’s having on their life.
• Part 4: Ask where they want to be. Ask them about their key goals in the next 6-12 months and what they want their future to look like.
• Part 5: Uncover the main challenges . Ask them where they need the most help.
• Part 6: Discovery “why now?” Ask them why it’s important for them to fix this now.
• Part 7: Make your offer. If you feel as though your offer can help get them to where they want to be, explain how it helps solve their problems — and present your investment options.

After you finish guiding a client through this framework, they’ll often have questions — or “objections.”

When clients ask you questions about your service, it’s a good sign.

Objections just mean they’re interested.

Objection handling is all about answering truthfully which minimizes the risk the client is feeling.

After you hear an objection, write it down. Then, after the call, write your best answer to it.

After many calls, you’ll know all the objections your ideal clients have, and you’ll be able to handle them with ease.

Now that you’re having these calls with your clients, it’s important to track each one with the consulting sales pipeline.

The Simple Consulting Sales Pipeline

There is a very clear progression to take a prospect and turn them into a paying client.

The consulting sales pipeline is a series of stages that outlines this progression.

By using a CRM and pipeline to track this progression, you’ll have a much easier time understanding your “lead flow” — the amount of consulting business you have in the works.

What gets measured gets managed. Manage your pipeline, and you’ll have an easier time closing consulting business.

You can break the consulting sales pipeline down into 5 columns:

• LEAD . You’ve identified the prospective client and have begun reaching out to them to set-up a conversation.
• CONVERSATION . You’ve had a sales conversation with the prospective client.
• PROPOSAL . You’ve sent a proposal to the prospective client.
• WIN . The prospective client has accepted your proposal and you won the business.
• LOSS . The prospective client has declined your proposal and you lost the business.
• NURTURE . Most people you reach out to won’t be ready to buy or make a decision right away. In fact, even people who say ‘No’ to a proposal now, may buy from you later as long as you stay top of mind through your nurture process.

By having your leads organized in these columns, you’ll understand what aspect of your marketing or sales you need to work on most.

Remember: consulting is a long-term sales cycle.

That nurture column is very important.

We’ve had clients who have followed us for years before they were ready to invest in our programs.

If you consistently nurture and follow-up with your leads, then you create top-of-mind awareness. So when the need for your service arises, they’ll think of you.

Selling is an integral part of starting a consulting business.

If you can’t sell your consulting projects, you can’t earn revenue.

If you don’t have revenue, you don’t have a business.

But by following this 6-step guide, you know how to identify, message, market, and sell your ideal clients.

And that’s how you start a consulting business: by winning your first few clients.

Once you can do that, the logistics of starting will be easier.

What Comes Next? Start A Consulting Business Checklist

Getting clients is where consultants — especially new ones — struggle the most.

If you start your business by mastering this crucial skill, you’ll be in much better shape.

That said, there are some other considerations for starting your consulting business.

We’ve put together a simple checklist to walk you through the logistics.

Remember: focusing on your office or accounting before you can win clients is a bad idea.

Your ability to win new business comes first.

Start A Consulting Business Checklist

There are a few things you’ll need to set up a professional consulting business.

5 factors you must consider:

• Incorporation

We’ve put together a checklist to help you start a consulting business and cover these 6 areas.

Equipment For A New Consulting Business

You don’t need much equipment to start a consulting business, but you’ll need a few logistical things.

• An office space (can be a home office)
• Telephone with voicemail
• Mailing address
• Computer/laptop with high-speed internet

Do You Need To Incorporate A Consulting Business?

In most cases, you don’t have to incorporate a brand new consulting business. But you should consider it.

• I’ve incorporated my consulting business (recommended only if you are making far more than you need to live on — or if you’re at risk of litigation)

Accounting For Your Consulting Business

Trying to do my own accounting was one of my biggest mistakes as a young consultant.

Make sure you hire an accountant and set up a separate business account for your consulting business.

The return on your investment in time saved and with regards to your taxes will be worth it.

• I’ve hired an accountant to do my invoicing and taxes
• I’ve set up a bank account for my business

Legal Considerations

As a newfound consulting business owner, connect with a lawyer who understands small businesses. Then, if you have any questions, you can call them for help.

• I know a lawyer who can help me with any legal questions I might have

Your Consulting Office

You don’t need a fancy office — but you do need a quiet space where you can do deep work.

My office space is distraction-free: where I can think, work, and make calls.

My temporary consulting office while in Japan. You can run a million-dollar consulting business from an office space like this

Now, you know everything you need on how to start a consulting business.

Follow these steps in order and get started!

Get Help To Start Your Consulting Business

Feeling a bit overwhelmed?

I get it. There’s a lot to this article.

If you’ve been excited about starting your own consulting business, you might even be feeling a little discouraged at this point.

That’s OK. There’s a lot of work ahead of you.

But now, you know how to start a consulting business the right way.

You now have a guide that gives you the process of building a profitable consulting business.

And if you’re still reading, taking notes, and not discouraged by the work ahead, then you’re serious about becoming a successful consultant.

If you’d like our help to guide you through this process so you can avoid spinning your wheels and hoping that you’re going about it the right way, get in touch.

Our Coaching Program For Consultants

We’ve helped over 500 consultants from all around the world in all different industries grow their consulting businesses and add six and seven figures to their annual revenues along the way.

Coaching has been the single best investment for our consulting business — and it’s the same for our clients.

So, are you ready to accelerate your success and realize your true potential as a consultant?

If you’re interested in learning more about our coaching program for consultants go here now: Clarity Coaching Program .

Why are you interested in starting a consulting business and becoming a consultant?

What are the biggest challenges you’re facing right now in getting your business off the ground?

Let us know and join the discussion in the comments below.

And if you enjoyed this guide, please take a minute right now to share it with others through social media!

How To Start A Consulting Business Study (2024)

Want to see the data on how to start a consulting business?

We sent out a survey to consultants asking how they started their consulting business — and over 500 people responded.

We analyzed the data and used it to help inform our 6 steps to start a consulting business.

If you want to learn how to start a consulting business based on data from real consultants, this study is for you.

QUICK LINKS

• Key Findings

Reasons To Start A Consulting Business

Transitioning from corporate to entrepreneurial consultant, consulting business operations, consulting fees, marketing, & proposals, consulting demographics, key findings from our “how to start a consulting business” survey.

Let’s start with our 12 key findings from the survey data.

1. For 60% of consultants, their first consulting client is a referral from their network .

2. Consultants find mentorship/coaching more helpful than any other form of learning.

3. 63% of consultants cite networking and referrals as their most powerful marketing channel , followed by social media (25%).

4. Marketing, sales , and fees are what consultants feel the least prepared for before starting their consulting business — and are the most challenging part of the business.

5. 63% of consultants win less than 60% of their consulting proposals . Consultants who discuss their proposals with the client on Zoom are twice as likely to win 60%+ of their proposals .

6. Over 50% of consultants reach their previous income level as employees within 2 years of starting their consulting business .

7. The most common average dollar value (in USD) for consulting projects is $5000-$15K and $15K-$50K . 33% of consultants’ average project value is in the $15K-$50K range. 6% of consultants’ average project value is over $100K. In North America, $15K-$50K+ projects are much more common.

8. The majority of consultants (63%) state this as their long-term goal: “ I want a profitable business to provide a great lifestyle for me (and my family) ”

9. The most popular pricing models for consultants are project rate (36%), followed by value pricing (26%) and hourly fees (23%). In our previous 2022 study, the breakdown was project rate (37%), value pricing (26%), and hourly (21%).

10. When compared to male consultants, female consultants were more than twice as likely to answer “ Fees : figuring out what to charge and why” as their biggest challenge in consulting .

11. Consultants who have invested in mentorship or coaching are more than twice as likely to use value pricing .

12. Over 50% of consultants quit their jobs and then started their consulting business compared to 25% who started their business while still at their job.

Now let’s take a closer look at the data.

We began the survey by asking respondents WHY they decided to start a consulting business.

The #1 Reason People Start A Consulting Business

People decide to start a consulting business for many different reasons:

• Realize my potential (26%)
• Be my own boss (22%)
• Flexible schedule (14%)
• Was laid off from my job (12%)
• Other (10%)
• Unlimited income potential (9%)
• Ability to work from anywhere (7%)

Starting a consulting business offers you the opportunity to create more freedom, wealth, and impact than traditional employment.

Were Consultants Unhappy With Their Former Careers?

42% of consultants were dissatisfied with their former job.

25% of them were very dissatisfied.

However, 33% liked their jobs.

Upon further analysis of the data for this survey question, here’s what we found:

• Of consultants who were dissatisfied with their jobs, the most popular answer for why they started their consulting business was “Be my own boss.”
• Of consultants who were not dissatisfied with their jobs, the most popular answer for why they started their consulting business was “Realize my potential.”

How Long Consultants Thought About Starting Their Consulting Business

45% of consultants had thought about starting their business for a few years.

26% had been thinking about starting their own business for more than 5 years.

And 29% had been thinking about starting their own business for less than a year.

In 2024, starting a consulting business has never been easier.

• Consultants who had been thinking about starting a consulting business for more than 5 years were more than twice as likely to start their business while still employed compared to those who had thought about starting a consulting business for less than a year.

What Consultants Felt MOST Prepared For Before Starting A Consulting Business

We asked consultants what they felt most prepared for before starting their business:

• Project Delivery : delivering on projects for my clients (49%)
• Operations : setting up and running the business (accounting, legal, etc) (12%)
• Sales : turning conversations with prospective clients into paid projects (10%)
• Prioritization : Knowing what to focus on and when (9%)
• Marketing : generating conversations with prospective clients (8%)
• Time Management & Organization : getting everything on my to-do list done (7%)
• Emotional : loneliness and frustration with starting a new business (3%)
• Fees : figuring out what to charge for my services and why (1%)

When starting a consulting business, the biggest challenge isn’t delivering projects.

It’s winning those projects.

What Consultants Felt LEAST Prepared For Before Starting A Consulting Business

Here’s what consultants felt least prepared for:

• Marketing : generating conversations with prospective clients (31%)
• Sales : turning conversations with prospective clients into paid projects (22%)
• Fees : figuring out what to charge for my services and why (16%)
• Prioritization : Knowing what to focus on and when (7%)
• Emotional : loneliness and frustration with starting a new business (6%)
• Project Delivery : delivering on projects for my clients (3%)
• Time Management & Organization : getting everything on my to-do list done (2%)

Marketing and sales are the hardest part of starting a consulting business.

That’s why they are a major focus in our Clarity Coaching Program (get in touch if you’d like help taking your marketing and sales to the next level so you can see greater growth in your consulting business).

How Families Feel Before You Start A Consulting Business

If you decide to start a consulting business, how will your partner/family feel?

For 46% of consultants, their partners were very confident and happy to support their decision.

42% said their partner was somewhat confident and happy to support their decision.

11% said their partners were somewhat unconfident and unhappy to support their decision.

And 1% said their partners were very unconfident and unhappy to support their decision.

Support from your partner or family is important to your level of success as a consultant.

• For consultants whose partners were very supportive of their decision to start a consulting business, 38% of them reached their previous level of income as an employee within 1 year (compared to 14% of those whose partners were unconfident and unhappy to support their decision).
• For consultants whose partners were somewhat unconfident and unhappy to support their decision, 61% of them are still working on reaching their previous level of income as an employee after 3 years (compared to 30% of consultants whose partners were very confident and happy to support their decision).

So, you’re in a corporate job and want to start a consulting business.

How do consultants actually make this transition?

Here’s what they had to say.

Did Consultants Start Consulting On The Side Or Quit Their Job?

51% of consultants quit their job and then started their consulting business.

24% started their business while they were still at their job.

Both of these are valid transition strategies.

Which one you choose depends on your risk tolerance, financial runway, and network

(25% of consultants selected “Other” on whether they started consulting on the side or quit their job and went all in)

Upon a deeper analysis of this question’s survey data, we found that…

• Consultants who quit their jobs and then start a consulting business reported a higher level of income than those who started their consulting business on the size.
• Consultants who quit their jobs and then start a consulting business reported a higher average revenue per engagement than those who started their consulting business on the side.

How Consultants Get Their First Consulting Client

Getting your first consulting client is a critical first step.

• 60% of consultants get their first client as a referral from their network.
• For 12% of consultants, their first client is their previous employer.
• 7% of consultants also get their first client from an outbound marketing method.
• 7% of consultants’ first client is a previous employer.
• 2% of consultants get their first client via an inbound marketing method .

(12% of consultants selected “Other” for how they got their first consulting client)

Consulting is a relationship business.

Getting your first client by tapping into your network is a powerful approach that has worked well for hundreds of consultants and it’s what we teach in our programs.

Do The Skills You Learn In Your Career Help As A Consultant?

84% of consultants say that the skills they learned in their former career helped “a lot” as a consulting business owner.

13% said these skills “helped a bit.”

And only 2% said the skills “didn’t help at all.”

Sharpening up your consulting skills is a high-ROI move. You’ll need more than what you learned in your corporate role.

The Biggest Challenge For New Consultants

Here are the biggest challenges for new consultants:

• Marketing : generating conversations with prospective clients (36%)
• Sales : turning conversations with prospective clients into paid projects (26%)
• Fees : figuring out what to charge for my services and why (13%)
• Operations : setting up and running the business (accounting, legal, etc) (9%)
• Prioritization : Knowing what to focus on and when (5%)
• Emotional : loneliness and frustration with starting a new business (4%)
• Time Management & Organization : getting everything on my to-do list done (3%)

Consultants accurately predicted what would be their biggest struggles once they’ve started their business: marketing, sales, and pricing.

Do Solo Consultants Ever Feel Lonely?

If you’re transitioning from corporate to consultant, you might find yourself dealing with newfound feelings of loneliness.

36% of consultants have felt lonely and still do at times.

21% of consultants felt lonely in the past, but no longer do.

And 43% of consultants never felt lonely as solopreneurs.

Upon a deeper analysis of this question’s survey data, we also found that…

• Consultants who feel lonely running a consulting business are more likely to have been dissatisfied with their former jobs.
• Consultants who don’t feel lonely running a consulting business reach their previous income level faster compared to those who do feel lonely. For consultants who don’t feel lonely, 40% of them reached their previous level of income within 1 year. For consultants who do feel lonely, 48% of them are still working to reach their previous level of income after 3 years of consulting.

How Long Does It Take Consulting Business Owners To Exceed Their Previous Income?

32% of consultants reached their previous income in less than 1 year.

21% reached their previous income within 2 years, and 10% within 3 years.

But 37% of consultants are still working on reaching their previous income level as an employee after 3 years.

The quickest shortcut to replacing (and exceeding) your previous income level is to invest in a program by consultants, for consultants .

Do Consulting Business Owners Invest In Courses, Coaching, Or Mentoring?

42% of consultants invested in courses, coaching, or mentoring and found it very helpful.

21% of consultants found these resources somewhat helpful.

37% of consultants have not invested in courses, coaching, or mentoring.

Upon a further look at the survey data for this question, we also found that…

• For consultants who have invested in mentorship and coaching, the most popular answer for what form of learning they found was most helpful was “mentorship.”
• For consultants who have not invested in mentorship or coaching, the most popular answer for what form of learning they found most helpful was “free online content.”
• Consultants who have invested in mentorship or coaching are more than twice as likely to use value-based pricing.

How do consultants run their business — and what are their goals?

Here are a few questions we asked about their current stage

Consultant Annual Income

How much money do consulting business owners make?

• 27% make less than $50,000
• 21% make $50K-$99K.
• 18% make $100K-$149K.
• 16% make $150K-$249K.
• 14% make $250K-$499K.
• 1% make $500K-$999K.
• 2% make $1M-$3M.

We have many high-six and seven-figure consultants in our consulting community.

Of consultants who are earning mid-six figures or more…

• 60% of them quit their jobs and then became a consultant instead of starting their business while still at their jobs.
• Over 50% invested in courses, coaching, or mentorship.
• Over 50% of them have at least an admin/assistant on their team (or more team members).
• The most helpful form of learning/resource was mentorship and coaching.
• 66% of them get on Zoom (or the equivalent) to review their proposals with the client.

Do Consultants Have Teams

As a consultant, there are a few different consulting business models to choose from.

63% of consultants do not have a team and do everything alone.

22% of consultants have a team of 2-9 employees or contractors.

10% of consultants have an assistant/admin to help them stay organized.

4% of consultant business owners have 10 or more employees or contractors.

Resources Most Helpful For Consultants

What form of learning do consultants find most helpful?

• 29% said that mentorship and coaching is most helpful .
• 25% said free online content .
• 18% said books .
• 12% said courses .
• 12% said communities .
• And 6% said “other.”

There is an endless amount of information on the web about consulting.

But it can be challenging to find actionable information.

That’s where we focus on our content and programs: helping you implement the information and get the results you desire.

Primary Consulting Goals

What are the primary goals of consulting business owners?

52% want growth : to build a team, get systems in place, and grow the business.

29% want productization : to earn more while working less.

11% want maintenance: they’re happy with where they’re at.

7% have an “other” goal.

And 1% want to sell their consulting business .

Long-Term Goals For Consultants

So, what do consulting business owners want in the long term?

63% want a profitable business to provide a great lifestyle for them and their families.

18% want to keep growing and making more money, but they haven’t thought about selling their firm.

12% plan to sell their business one day.

And 7% haven’t given their long-term plan much thought.

Consulting fees, marketing, and proposals are always hot topics.

Here are some specific questions we asked about these topics.

How Consultants Set Their Consulting Fees

There are a few different ways you can set your consulting fees .

Here’s how consultants do it:

• 36% use a project rate.
• 26% use a value-based rate .
• 23% use an hourly rate.
• 14% use monthly retainers .
• 2% use a performance-based model.

Over 50% of consultants use a pricing method we DON’T recommend: project rate and hourly.

One of the highest ROI moves you can make is to switch to value-based fees .

• Consultants who use a value-based fee report a higher consulting proposal win percentage over those who use an hourly rate.
• Consultants who use a value-based fee are much more likely to review their proposal with their client on Zoom instead of emailing their proposal to the client.
• Strategy consultants are the type of consultants most likely to use value-based fees.
• Management consultants are the type of consultants most likely to use an hourly rate.
• A higher percentage of men (68%) use value-based fees compared to women (32%).

What Marketing Channel Works Best For Consultants

How do consulting businesses get their clients?

• For 63%, networking/referrals is their best marketing channel.
• 25% said social media is their best marketing channel.
• 9% said speaking/presentations are their best marketing channel.
• 3% said cold email/cold calling.
• 1% said Blog/SEO.
• 0% said either paid advertising, videos/youtube, or podcasting.

A good marketing strategy for consultants will have you doing a bit of each.

But, it’s important to put your energy into the channels that are working best for your particular business.

How Many Clients Do Consultants Get Through Their Website?

70% of consultants get 0 leads/calls per month from their consulting website .

16% of consultants get 1-3 leads/calls per month from their website.

9% of consultants get 3-7  leads/calls per month from their website.

And 5% of consultants get 8+ leads/calls per month from their website.

If you’re one of the 70% of consultants getting 0 leads from your website, check out our Consulting Website Template Kit .

What % Of Proposals Do Consultants Win

24% of consultants win less than 20% of their proposals.

22% of consultants win 40-59% of their proposals.

21% of consultants win more than 80% of their proposals.

17% win 20-39% of their proposals.

And 16% win 60-79% of their proposals.

Consulting proposals are a critical part of winning consulting projects.

Here’s our consulting proposal template to help you win more proposals.

At the very least, you should be winning 60%+ of your proposals.

• Of consultants who win 80% of their proposals, 43% of them reached their previous income level within a year.
• Of consultants who win less than 20% of their proposals, 54% of them are still trying to reach their previous income level after 3 years.
• There is virtually no difference in the pricing model used by consultants who win 80%+ of their proposals versus those who win 20% or less (which suggests it’s about sales skills, not the pricing method).
• For consultants who win 80% of their proposals, 53% of them review their proposal live with the client on Zoom (as opposed to 29% of consultants who win less than 20% of their proposals).

How Consultants Deliver Their Proposals

49% of consultants review their proposals with the client on Zoom (or equivalent).

34% of consultants email their proposal to the client.

And 17% of consultants meet the buyer in person to review the proposal.

We recommend that you get on a call with buyers to review the proposal together. This will drastically increase your win rate.

Upon further analysis of this data, we also found that consultants who get on Zoom to deliver proposals are…

• 104% as likely to win 60%+ of their proposals.
• 133% more likely to use value-based fees.
• Have a higher average dollar value of typical client projects.

Average Consulting Project Value ($USD)

How much do consulting business owners make per project?

• 33% make $15K-$50K per project.
• 29% make $5000-$15K per project.
• 18% make less than $5K per project.
• 14% make $50K-$100K per project.
• 5% make $100K-$500K per project.
• And 1% make $500K per project.

Upon further analysis of the survey data for this question, we also found that…

• Consultants with an average project value of $50K-$100K have a much higher annual income than those charging $15K or less.
• For consultants who are charging $50K-$100K+ per project, the most popular answer for what form of learning they found most helpful was mentorship (43%).

We also asked consultants some basic demographic questions.

Here are their answers:

Types Of Consultants

There are many different types of consultants . Here is a breakdown of the type of consulting that people who took part in this study identify as…

• Management consultant (24%)
• Strategy consultant (21%)
• Other (16%)
• Operations consultant (10%)
• IT/Tech consultant (5%)
• Marketing consultant (4%)
• HR consultant (4%)
• Non-profit consultant (4%)
• Sales consultant (4%)
• Financial advisory consultant (4%)
• Science/Pharma Consultant (2%)
• Data consultant (2%)
• Design/branding consultant (0%)
• E-commerce Consultant (0%)

On our client results page , we have stories about helping ALL types of consultants start, grow, and scale their businesses.

How Many Years Have You Been In The Consulting Business?

We saw everyone from consulting business “newbies” to consulting business veterans.

• 26% of consultants have been in the business for 1-3 years.
• 21% have been consultants for 15+ years.
• 19% have been consultants for 4-6 years.
• 15% have been consultants for less than 1 year.
• 11% have been consultants for 7-10 years.
• And 8% have been in the business for 11-14 years.

Age of Consultants

There are consulting business owners within every generation.

• 37% of consulting business owners are 50-59.
• 29% of consulting business owners are 60+.
• 25% of consulting business owners are 40-49.
• 8% of consulting business owners are 30-39.
• And 1% of consulting business owners are 20-29.

You can be a successful consultant at any age.

Consulting Gender Demographics

63% of consultants we surveyed are male.

37% are female.

Here are some additional insights on the gender differences in consulting:

• Female consultants were twice as likely to say that they were very dissatisfied with their former jobs when compared to male consultants.
• When compared to male consultants, female consultants were more than twice as likely to answer “Fees: figuring out what to charge and why” as their biggest challenge in consulting.
• Female consultants were nearly twice as likely to list “Productization” as their primary goal as a consultant compared to male consultants.

Where Consultants Live

You can start a successful consulting business from anywhere in the world. Here are where the 500+ respondents of this study live…

• 64% of consulting business owners are in North America.
• 11% are in Western Europe, and 2% are in Eastern Europe.
• 7% are in Africa, and 7% are also in Asia.
• 5% are in Australia/New Zealand.
• 4% are in South America.

As a consultant, your demographics don’t matter.

As long as you can solve problems and create results for your clients, you can be successful in this business.

31 thoughts on “ How To Start A Consulting Business In 2024 (6 Steps & Study) ”

Great article Mr Michael, truly to establish a successful consulting business requires strategy, tactics and a proven mindset. I have been fortunate to be part of your mailing list, following your blog post and listening to your podcast for quite some time and it has truly helped me. Thank you so much for what you do. I will like to ask, how do one create a discovery offer? Is creating a discovery offer possible for all consulting practices?

Otobele, you’re very welcome and glad you’ve been finding value. Yes, every business can develop a discovery offer. We go deep into this in the Clarity program: https://www.consultingsuccess.com/coaching-for-consultants

Thank you Michael, as one new to the consulting business, I look forward to registering with your program once am able to raise the fee. I appreciate you

Really enjoying all of your articles and podcast. So helpful in getting my consulting business off the ground. Thank you Michael.

Appreciate the comment Janice and glad to hear you’ve found the resources here helpful. Wish you great success!

This is super helpful. Did you really have a consulting practice for 18 years?

Hi Andrea, glad you found it helpful. I’ve been consulting and building consulting businesses for going on 19 years and have been working with consultants to help them grow their businesses for the last 10 years. Wish you great success with yours.

This is very nice information. Thanks for sharing this informative information.

You are very welcome glad it’s helpful.

Hello Mr.Michael, I am a 25yr old student pursuing my masters, i have experience of a year in the field of finance and accountancy and i am very much driven to start a consulting business, as i am excited towards helping a business grow and be profitable,so i just wanted to ask you that am I in a position to start a consulting business with this much experience or do i have to wait some more years to go ahead with consulting? Awaiting your reply. Thanks.

Huzefa, don’t wait for anything. Go after what you desire. I started my first consulting business my first year in university. I had a lot to learn and still do. Focus on your strengths and where you can provide value. That’s your starting point. From there work on developing your skills and expertise. Keep at it.

Your article shows the best practical way to start a consulting business. Novice will gain more knowledge from this.

Thanks for your comment Anthony.

I’ve been in the restaurant business since I was five. I’ve continued to expand in a food service Industry in different areas. I’d like to further my career by becoming a consultant. Not only to help others but to learn more.My question is what is my first step to get started?

Hi Andrew! That’s great you’ve been in the industry since age 5! Here’s where to start: Identify your ideal client and who you want to serve that you can bring value to. Then go and have conversations with them to validate what they want and how you can help. If you’d like a proven guide to follow step by step to launch your consulting business use this: https://www.consultingsuccess.com/momentum

Loved the information as I am in the process of forming a consultancy. Please feel free to send further guidance in particular regarding financials as I require assistance in that area.

Glad you loved it. Appreciate the comment Leighton

To start any business, it is very essential to make proper planning, set the budget, check out various issues that can happen later, risks involved while opening a business, etc.

Glad this helps Kartik

My former supervisor sent me this when I shared my intention of starting an HR consultancy outfit with him. He mentioned he wished he had come across this before he started off his and now I know why! Thank you so much this is very useful since I am just starting!

Glad to see this is helpful Femi – wish you great success!

Very Nice content

Glad it resonates Aman!

Very much helpful Michael. I hope to start consulting in refugee camps in Uganda. I’ve always helped some local CBOs and refugees on finance and business respectively. Though not much paying, but its worth helping.

I’m glad it’s helpful Alison. Wishing you great success!

I appreciate the story of you and your cousin … particularly the “dark period” and having relinquished the “dream job”, to come out on the other side.

I just taught a workshop with a segment about being world class. Your story resonates with those principles.

Appreciate the thoughtful comment Kent and nice to hear the story resonates. Great to have you in the community here.

Really nice article! Thanks for that. I’m a web developer working for companies for 10 years (began to code 20 years ago) and I’ve worked quite a lot with CMS. I was thinking being a remote and international consultant, helping non-profit with their content (strategy and technical). Of course I’m afraid, I feel I don’t have enough expertise; so many things I don’t know… I’m definitely considering momentum though, it looks great!

Glad to hear that Matthieu and welcome to the community!

Is it possible to start as a side business to eventually wean out the current employee status? If so, how?

Hi Stuart, it is very possible and we’ve helped many people do exactly this. Take a look at our Momentum course for a self-study option or our Clarity Coaching program if you want to be coached through the process. Happy to help.

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How to Start a Consulting Business: The Definitive Guide for 2024

Will your business idea succeed? Take our quiz - completely confidential and free!

You’ve become an expert in your field after years of dedication, countless hours of work, and relentless pursuit of excellence.

So, what’s next?

Imagine leveraging your expertise and time into a rewarding venture – starting a consulting business .

What is consulting?

Consulting is the art and science of offering specialized advice, sharing opinions, and crafting strategies to help clients excel. Consultants aren't just advice-givers; they wear numerous hats. They diagnose problems, gather data, offer constructive feedback, build strategies, and participate in implementation.

According to Statista, the information technology consulting industry in the U.S. grew by over 30% between 2011 and 2019, amounting to more than $600 billion in 2022. Similarly, the management consulting sector is projected to hit $343.4 billion by 2025 from an estimated $330 billion in 2023.

And these are just two pieces of the enormous consulting pie.

Leveraging my extensive experience of over a decade as an attorney, alongside a 15-year journey mentoring numerous entrepreneurs, I’ve had the privilege of collaborating with hundreds of consultants and consulting firms. I’ve also hired many consultants for my businesses.

Moreover, crowdspring has served as a vital springboard for tens of thousands of ambitious consultants and aspiring small business owners for the past fifteen years. Our team has amassed a rich repository of insights, practical tips, and industry best practices essential for kick-starting and successfully sustaining a consulting venture.

This definitive guide shares this collective wisdom, hard-earned experiences, and insightful learnings with you.

Consultant vs. contractor vs. freelancer

As you prepare to launch your consulting business, it’s essential to understand your place in the professional landscape. The terms ‘consultant,’ ‘contractor,’ and ‘freelancer’ are often used loosely and interchangeably, but critical differences exist.

While consultants, contractors, and freelancers offer their services to businesses, their roles diverge beyond this similarity.

Contractors, including freelancers, are self-employed professionals contracted by companies to provide specific services. On the other hand, consultants are specialists who offer expert advice and assessments. They can either be independent or part of a consulting firm.

However, the lines can blur.

You could be asked to deliver a specific service as a consultant, making your role somewhat akin to a contractor. For instance, imagine you’re hired to evaluate a customer service team’s performance. Post-assessment, you suggest a new strategy and training plan. If you’re asked to develop and present this strategy, your role will expand to include elements of a contractor’s job.

Consulting is a vast field with opportunities across virtually all sectors. Let’s explore the diverse consulting specializations you can consider.

Free Business Startup Kit

Receive six actionable guides, including a how to start a business checklist, detailed comparisons of LLCs, corporations, sole proprietorships, and partnerships to determine the best fit for your business, plus insights on crafting a compelling pitch deck to attract investors.

• How to Start a Business Checklist
• Starting a Corporation Guide
• Is an LLC Right for You?
• Starting a Sole Proprietorship
• Starting Business Partnerships
• Creating a Powerful Pitch Deck

How to Start a Consulting Business

• Choose your niche and define your services
• Write a business plan
• Choose your legal business structure
• Set up business accounting and bookkeeping
• Assess your finances and secure startup capital
• Develop your brand identity
• Create an effective fee structure
• Launch your website and market your business
• Grow your consulting business

Additional resources for consultants

• Frequently Asked Questions (FAQs)

1. Choose your niche and define your services

When someone utters the word “consulting,” what springs to mind?

Is it a seasoned expert offering priceless advice or a niche firm with razor-sharp strategies to tackle business challenges?

Consulting is a thriving industry revolving around knowledge – the commodity businesses are willing to pay for.

Business leaders often navigate complex problems; sometimes, the much-needed solution is a fresh perspective. That’s precisely what consultants bring to the table. Their unbiased viewpoint helps reduce the noise and find the best approach to tackle business problems.

In a nutshell, consultants are problem solvers. They work tirelessly to make their clients more successful, a commitment that makes the consulting business rewarding and lucrative.

Here are some of the reasons that businesses hire consultants:

• Businesses hire consultants because of their expertise. Suppose a company is raising funding or adopting a new software system. In that case, it pays for them to hire a specialist who has raised millions or has already implemented the same software system.
• Businesses hire consultants to supplement their staff. Companies often engage consultants for their specialized skills and flexibility. This approach eliminates the costs and commitments of full-time hires, particularly for temporary projects.
• Businesses hire consultants to identify problems. It’s not uncommon for employees to struggle to resolve an issue inside an organization. Having seen a similar situation across many organizations, an experienced consultant might have the necessary expertise to help.
• Businesses hire consultants to promote change. Often, companies get stuck trying to change their internal organization, so outside consultants are often used to facilitate the transition.
• Businesses hire consultants to teach. Training programs, retraining programs, technical software implementation, and other areas require specialized skills that only experienced consultants offer. And remember, age is simply a number. Even if you’re over 60 or have been living the good life for a while, there’s never a wrong time to kick off your consulting gig. You’ve got a lifetime of lessons under your belt, and believe it or not, people are always hunting for that kind of seasoned insight.
• Businesses hire consultants to make tough decisions. If a company needs to downsize, it will often bring in consultants to make the tough decisions to deflect blame for letting people go.
• Businesses hire consultants to influence important decision-makers at other companies. For example, if you’re trying to reach a deal with another company and find a consultant who knows that company well, the consultant may be the X factor in putting the deal together.
• Businesses hire consultants for ideation. Sometimes, a company hits a rough patch and has a hard time finding new ideas. Consultants can help bring new energy to the business and help ideate products and services.
• Businesses hire consultants to create new companies and products. Some specialized consultants help others create (or buy) new companies’ products and services.

When choosing your niche, you can start by assessing your skills and strengths and brainstorming the general consulting services you’d like to offer.

How to assess your skills and strengths for consulting:

• Start by identifying your transferable skills. What skills have you gained from your education, work experience, and personal life that can be applied to consulting? For example, if you have experience in sales, you may have transferable skills such as communication, persuasion, and negotiation.
• Reflect on your past experiences. Think about the projects and tasks that you have completed in the past. What skills and strengths did you need to be successful? For example, you may have demonstrated organization, time management, and problem-solving skills if you successfully managed a complex project.
• Survey your network. Ask your friends, family, and colleagues for feedback on your skills and strengths. What do they see as your assets? What areas do they think you could improve?
• Take a skills assessment test. There are several online and offline skills assessment tests available. These tests can help you identify your strengths and weaknesses in various areas, such as communication, problem-solving, and critical thinking.
• Complete a personal SWOT analysis. A SWOT analysis is a framework for identifying your strengths, weaknesses, opportunities, and threats. This can be a helpful exercise for assessing your skills and strengths as a potential consultant.
• Create a portfolio of your work. This could include samples of your writing, presentations, case studies, or other work products. A portfolio is a great way to showcase your skills and strengths to potential clients.
• Volunteer your services to a nonprofit organization. This is a great way to gain experience and test your skills in a real-world setting.
• Shadow a consultant. This is a great way to learn about a consultant’s day-to-day work and see if it is a good fit for you.
• Take a consulting course or certification program. This can help you to learn the essential skills and knowledge needed to be a successful consultant.
• Network with other consultants. Attend industry events and connect with other consultants on LinkedIn. This is a great way to learn from others and to get your foot in the door.

By following these suggestions, you can better understand your skills and strengths and develop a plan for becoming a successful consultant.

Just as you’d consider different business ideas when starting a business, you must nail down the specifics of your consulting business before you work with any clients.

This is vital for three reasons:

• You must articulate your consulting service to potential clients to convince them that your services are valuable.
• You’ll need to charge fees that let you run a sustainable business.
• Specificity helps to set realistic expectations for your clients and potential clients.

This last point benefits both you and your clients. Your clients can make comfortable, informed decisions, and you can avoid being taken advantage of.

While you can’t prevent “scope creep” entirely, being clear about what a client is paying for upfront (and getting it in writing) will help set realistic, workable boundaries both parties can agree to. And, importantly, this will also clearly define the value proposition for your consulting business.

If you’re struggling to identify what your niche or specialty might be, consider these techniques for narrowing it down:

• Identify any underserved specialties in your field.
• Consider what specialties will continue to be underserved by a suitable consultant over the long term.
• Determine which areas in your field clients and potential clients struggle with the most.
• Ask yourself if your unique background and niche expertise provide you with rare knowledge not easily found in the job market.
• You’ve probably informally helped friends solve their business problems and pain points. What areas have you focused on when working with your friends?
• Is your consulting business limited to helping clients in the United States, or will you provide services to clients worldwide?

Here’s a detailed look at the most popular consulting niches. For each niche, we’ll outline the essential skills required, provide insights into the typical clientele, and discuss the frequent challenges small businesses face.

Types of consulting:

• Management consulting
• Strategy consulting
• I.T. consulting
• Operations consulting
• Business consulting
• Financial strategy consulting
• Sales consulting
• Human resources consulting
• Marketing consulting
• Career consulting
• Financial consulting
• Environmental consulting
• Real estate consulting
• Risk management consulting
• Education consulting
• Legal consulting
• Digital transformation consulting
• Sustainability consulting
• E-commerce consulting
• Healthcare consulting
• Diversity, Equity, and Inclusion consulting (DEI)
• Public relations consulting
• Brand consulting
• Nonprofit consulting
• Food service consulting
• Retail consulting
• Franchise consulting
• Agriculture consulting
• Hospitality consulting
• Logistics consulting
• Payroll management consulting

1. Management consulting

Management consultants play a critical role in helping businesses improve their overall performance. They meticulously assess existing organizational issues, devise strategic improvement plans and aid in executing those strategies. Their solutions typically span various business functions, including operations, H.R., finance, and IT. They also collaborate with international contractors to ensure a global perspective is incorporated into their recommendations and to navigate the complexities of international contracting.

Skills needed: Problem-solving, business strategy, change management.

Typical clients: Large corporations like McKinsey and Bain & Company, where they may work with C-suite executives to streamline business processes.

Common SMB Problems: A local restaurant chain struggling to manage operations across multiple locations; an online retailer failing to optimize its supply chain efficiency.

2. Strategy consulting

Strategy consultants are the architects of high-level, strategic business decisions. They help companies devise growth strategies, enter new markets, and make informed business choices. They analyze a company’s strengths and weaknesses , assess market conditions, and help formulate a winning strategy.

Skills needed: Strategic thinking, industry-specific expertise, decision-making.

Typical clients: Large-scale organizations such as Coca-Cola and IBM, where strategic decisions have far-reaching consequences.

Common SMB problems: A brick-and-mortar bookstore considering expansion into the e-commerce space; an artisanal coffee shop struggling to differentiate itself in a competitive market.

3. I.T. consulting

I.T. consultants are technical wizards that help businesses implement and manage new technologies. They tackle system integration, software development, enterprise architecture, cybersecurity, etc. Their work is essential in today’s digital age, where technology plays a pivotal role in business success.

Skills needed: Technical knowledge, problem-solving, and project management.

Typical clients: Tech companies, manufacturing firms, and educational institutions.

Common SMB problems: A local bookstore trying to set up an online sales platform; a small travel agency experiencing difficulties with their booking system.

4. Operations consulting

Operations consultants are the mechanics of business processes. They help organizations streamline operations by enhancing supply chain management, procurement, manufacturing, and service delivery. They identify bottlenecks, propose improvements, and may even assist in implementing these changes.

Skills needed: Project management, process improvement, analytical thinking.

Typical clients: Large logistical companies like Amazon and FedEx, where efficient operations directly influence the bottom line.

Common SMB problems: A local craft brewery struggling with inventory management an online fashion boutique experiencing difficulties with order fulfillment.

5. Business consulting

Business consultants wear many hats, depending on their clients’ needs. They could advise on financial matters one day and resolve operational bottlenecks the next. Their ultimate goal is to help businesses run more efficiently and profitably.

Skills needed: Business understanding, problem-solving, and communication skills.

Typical clients: Small to medium-sized businesses, entrepreneurs, and startups.

Common SMB problems: An independent fashion retailer struggling with business growth; an online fitness trainer unsure how to scale their business.

6. Financial strategy consulting

Financial strategy consultants guide businesses in making sound financial decisions, focusing on corporate finance, risk management, financial restructuring, and real estate. Their expert financial advice helps companies maximize returns, manage financial risks, and comply with legal requirements.

Skills needed: Financial acumen, risk management, understanding of laws and regulations.

Typical clients: Multinational corporations, financial institutions, and property developers .

Common SMB problems: A growing neighborhood bakery unsure of how to manage its financial growth; an online health supplement retailer struggling with pricing strategy.

7. Sales consulting

Sales consultants are sales performance enhancers. They develop effective sales strategies , refine sales processes, and boost team morale, aiming to optimize sales team performance and, ultimately, increase revenue.

Skills needed: Sales expertise, communication skills, motivational abilities.

Typical clients: Companies with sales teams, ranging from technology firms to consumer goods manufacturers.

Common SMB problems: A small electronics store with stagnating sales figures; an online handcrafted jewelry shop failing to meet sales targets.

8. Human resources consulting

Human resources consultants are experts in managing a company’s most valuable asset—its employees. They guide H.R. processes, such as talent management, conflict resolution, training and development, benefits administration, and compliance with employment laws.

Skills needed: Understanding H.R. practices, interpersonal skills, and knowledge of employment laws.

Typical clients: Corporations of all sizes, startups, and nonprofit organizations.

Common SMB problems: A family-owned grocery store grappling with high employee turnover; a small digital marketing agency striving to develop a comprehensive employee benefits program.

9. Marketing consulting

Marketing consultants work magic with a company’s marketing strategy , enhancing brand visibility , customer engagement, and sales conversions . They specialize in diverse areas, including digital marketing, content creation, SEO , social media marketing, and more.

Skills needed:   Marketing expertise, creativity, analytical skills.

Typical clients: Any company needing marketing help, including tech startups, retail businesses, and service providers.

Common SMB problems:   A small café struggling to attract customers; an online clothing boutique experiencing low web traffic.

10. Career consulting

Career consultants serve as career architects, helping individuals set career goals and build successful careers. They assist with skill development, resume writing and enhancement , job applications, interview preparation, and market understanding.

Skills needed: Job market knowledge , interpersonal skills, H.R. expertise.

Typical clients: Job seekers, career changers, and businesses looking to support their employees’ career growth.

Common SMB problems: A small architectural firm looking to improve employee skillsets; an online tutoring company wanting to assist tutors with professional development.

11. Financial consulting

Financial consultants help individuals, families, and businesses manage their finances. They offer guidance on investments, budgeting, tax planning, insurance, and more. They help their clients make financially savvy decisions to achieve their monetary goals.

Skills needed: Financial knowledge, analytical skills, trustworthiness.

Typical clients: Individuals, families, entrepreneurs, and businesses of all sizes.

Common SMB problems: A family-owned bed and breakfast struggling with budgeting; an online art store owner uncertain about investment strategies.

12. Environmental consulting

Environmental consultants help businesses assess and minimize their environmental impact. They offer advice on sustainable practices, regulatory compliance, waste management, etc. Their work often intersects with the construction, energy, and real estate sectors.

Skills needed: Knowledge of environmental regulations, scientific expertise, and analytical skills.

Typical clients: Construction companies, energy producers, and manufacturing firms.

Common SMB problems: A local brewery looking to reduce water waste a small online furniture retailer aiming to source more sustainable materials.

13. Real estate consulting

Real estate consultants provide expert property buying, selling, and management advice. They analyze market trends, assess property values, and help clients make informed real estate investment decisions.

Skills needed: Deep understanding of the real estate market, analytical skills, and negotiation skills.

Typical clients: Individual investors, real estate developers, and commercial property firms.

Common SMB problems: A local coffee shop considering expansion needs advice on location selection, and an online business ready to establish a physical headquarters requires guidance on property acquisition.

14. Risk management consulting

Risk management consultants are an organization’s fortification experts. They identify potential threats to a business’s financial health, operational efficiency, or reputation and devise strategies to mitigate these risks.

Skills needed: Risk analysis, strategic planning, problem-solving skills.

Typical clients: Financial institutions, manufacturing companies, and businesses exposed to significant risk.

Common SMB problems: A small construction company grappling with safety compliance issues; an online travel agency struggling with data security risks.

15. Education consulting

Education consultants work with schools, educational institutions, or individuals to enhance learning experiences. They advise on curriculum development, educational policies, and strategies to improve student performance.

Skills needed: Knowledge of educational systems and policies, curriculum development, and interpersonal skills.

Typical clients: Schools, universities, and educational technology companies.

Common SMB problems: A local private school struggling to improve student outcomes; an online tutoring platform seeking advice on curriculum enhancement.

16. Legal consulting

Legal consultants provide expert advice on legal matters. They help with contract drafting, legal compliance, dispute resolution, and other legal complexities businesses may face.

Skills needed: Legal knowledge, analytical skills, attention to detail.

Typical clients: Businesses across industries require legal guidance without a full-time attorney.

Common SMB problems: A small brewery  is having difficulty understanding licensing laws, and an  e-commerce platform is  unsure about customer data usage compliance.

17. Digital transformation consulting

Digital transformation consultants help businesses adapt to the digital age. They guide companies in integrating digital technology in all operations, enhancing efficiency and competitiveness.

Skills needed: Proficiency in digital technologies, change management, and strategic planning.

Typical clients: Traditional businesses looking to digitize their operations and tech companies aiming to update their digital strategies.

Common SMB problems: A local bookstore wanting to create an online presence; an established online clothing retailer seeking to streamline order processing with advanced technologies.

18. Sustainability consulting

Sustainability consultants assist businesses in incorporating sustainable practices into their operations. They help clients reduce environmental impact, comply with sustainability regulations, and build a green brand image.

Skills needed: Understanding environmental science, corporate sustainability strategies, and regulatory compliance.

Typical clients: Manufacturing companies, energy firms, and businesses aiming for greener operations.

Common SMB problems: A local organic grocery store wants to reduce its carbon footprint, and an online eco-friendly clothing brand needs help with supply chain sustainability.

19. E-commerce consulting

E-commerce consultants guide online businesses toward success in the digital marketplace. They assist in website optimization , digital marketing, customer journey mapping , SEO consulting , and conversion rate improvement .

Skills needed: Digital marketing, SEO, UX design, data analysis.

Typical clients: Online retailers and businesses transitioning from brick-and-mortar to online.

Common SMB problems: A small local artisan wanting to sell their products online; a niche online beauty store struggling to increase site traffic and conversion rates.

20. Healthcare consulting

Healthcare consultants focus on optimizing healthcare organizations’ operations and outcomes. They scrutinize all aspects, from personnel and profits to processes, offering valuable insights to enhance efficiency and tackle complex challenges.

Skills needed: Deep understanding of healthcare systems , analytical skills, and problem-solving abilities.

Typical clients: Hospitals, clinics, healthcare tech companies, and pharmaceutical firms.

Common SMB problems: A local dentist office struggling with patient scheduling efficiency; an e-health startup looking to improve their telehealth service delivery.

21. Diversity, Equity, and Inclusion consulting (DEI)

DEI consultants promote diversity, equity, and inclusion within organizations. They bring an unbiased perspective to companies’ equity issues and help devise strategies that nurture an inclusive and respectful workplace culture.

Skills needed: Deep understanding of DEI issues, sensitivity to cultural differences, and practical communication skills.

Typical clients: Businesses across all sectors committed to improving diversity and inclusivity.

Common SMB problems: A local bakery with a culturally diverse staff experiencing communication issues; an online software development company aiming to build a more inclusive work culture.

22. Public relations consulting

P.R. consultants are crisis managers and image guardians for organizations. They strategize how to present the company in the best light, deal with potential crises, and facilitate effective communication with the public and media .

Skills needed: Excellent communication skills, crisis management expertise, and ability to think independently.

Typical clients: Enterprises, celebrities, political entities, or organizations needing to maintain a positive public image.

Common SMB problems:  A small town family restaurant facing negative press over a food safety issue; an online retail brand dealing with customer complaints going viral on social media .

23. Brand consulting

Brand consultants act as brand sculptors, carving out a company’s brand identity in the market. They conduct competitor analysis , initiate market research, and devise creative strategies to enhance brand perception and customer loyalty.

Skills needed: Creativity, market research skills, and understanding of consumer psychology .

Typical clients: Businesses looking to launch, rebrand , or strengthen their market position.

Common SMB problems: A local gym failing to differentiate its brand from competitors; an online pet supplies store struggling to connect with its target audience .

24. Nonprofit consulting

Nonprofit consultants assist charitable organizations in achieving their mission and improving their effectiveness. They help with fundraising strategies, volunteer management, marketing efforts, and organizational structure.

Skills needed: Understanding the nonprofit sector, fundraising strategies , leadership, and management skills.

Typical clients: Charitable organizations, educational institutions, and advocacy groups.

Common SMB problems: A small local animal shelter struggling with volunteer retention; an online nonprofit aiming to improve donor engagement and fundraising .

25. Food service consulting

Food service consultants advise restaurants, cafeterias, and other food establishments. They help with menu development, supply chain management, health and safety compliance, and operational efficiency.

Skills needed: Understanding the food industry, culinary expertise, and supply chain management.

Typical clients: Restaurants, hotels, catering businesses, and food delivery services.

Common SMB problems:  A small town café needing menu innovation to compete with larger chains; an online food delivery service struggling with logistical and supply chain issues.

26. Retail consulting

Retail consultants work with businesses to optimize their operations, sales strategies, inventory management, and customer service. They help brick-and-mortar stores transition to e-commerce and cope with the challenges of the digital era.

Skills needed: Understanding the retail industry, sales and marketing expertise, and knowledge of e-commerce trends.

Typical clients: Retail stores, e-commerce businesses, and department stores.

Common SMB problems: A local bookstore struggling to compete with online retailers; a clothing store facing inventory management issues.

27. Franchise consulting

Franchise consultants help businesses become franchisors or help potential franchisees select the right opportunity. They also help with legal matters, business plans, marketing strategies, and location selection.

Skills needed: Franchise business models, legal expertise, and business development skills.

Typical clients: Potential and existing franchisors and franchisees.

Common SMB problems: A small fast-food restaurant looking to franchise their business; an online tutoring service considering becoming a franchisee.

28. Agriculture consulting

An agriculture consultant assists farmers and agribusinesses in making informed decisions that improve their farm operations’ profitability and sustainability. They can provide expert advice and assessments on crop management, soil health, livestock care, sustainable farming practices , and modern farming technologies.

Skills needed: Deep knowledge of farming techniques, environmental regulations, and agricultural economics. Furthermore, an understanding of biotechnology and proficiency in data analysis can be beneficial.

Typical clients: Farm owners, agribusinesses, agricultural technology firms, agrarian nonprofits, and government agencies.

Common SMB problems: A small family-owned vineyard might struggle with soil health, which affects its grape yield. Alternatively, an organic vegetable farm could explore ways to enhance sustainable farming practices to meet increased demand without compromising its organic status. These situations call for an agriculture consultant’s expertise.

29. Hospitality consulting

Hospitality consultants assist businesses in the tourism and lodging industries. They help with business development, customer service strategies, facility management, and creating memorable guest experiences.

Skills needed: Understanding of the hospitality industry, customer service expertise, and facility management skills.

Typical clients: Hotels, resorts, travel agencies, and event planning businesses.

Common SMB problems: A boutique hotel struggling with online booking management; a local tour agency facing marketing challenges in attracting tourists.

30. Logistics consulting

Logistics consultants help businesses streamline their supply chain, distribution, and transportation processes. They assist in optimizing warehouse operations, reducing shipping costs, and improving delivery times.

Skills needed: Supply chain management, transportation logistics, analytical skills.

Typical clients: Manufacturing companies, e-commerce businesses, and logistics providers.

Common SMB problems: A local craft brewery having issues managing distribution logistics; an online clothing retailer struggling with international shipping costs and regulations.

31. Payroll management consulting

Payroll management consultants streamline and optimize a business’s payroll process, ensuring employees’ accurate and timely payments. They help create efficient payroll structures, integrate payroll systems, ensure regulatory compliance, and manage payroll taxes.

Skills needed: Extensive knowledge of payroll systems and payroll services , tax regulations, auditing skills, numerical proficiency, and a thorough understanding of local and international labor laws.

Typical clients: Any organization that manages a workforce, from small businesses to multinational corporations, across industries.

Common SMB problems: An e-commerce startup might struggle with managing payroll for its remote workers across different states or countries, creating issues with tax compliance and payment schedules. In another scenario, a local retail business may experience errors in calculating overtime, leading to discrepancies in employee pay.

Finally,  remember to consider the size of your target market. Not every niche will be lucrative. Once you understand each niche’s  total addressable market (TAM) , you can make more informed decisions .

2. Write a business plan

Starting a new business is quite an adventure, and like any good journey, it can be helpful to have a map. That’s where a business plan comes in.

It’s not a must-have, but it can help clarify your thoughts and dodge some rookie mistakes.

Believe it or not, studies show that folks who take the time to jot down a business plan when kick-starting a business are 2.5 times more likely to see their dreams turn into reality. Not only that but crafting a business plan also helps you sharpen skills that’ll be a tremendous asset down the line.

Don’t sweat over making every little detail perfect in your business plan.

You certainly don’t need to lose sleep over writing a 100-page document. There are tons of practical one-page business plan models out there that can guide you in writing a concise, one-page business plan.

Different consulting business models

The independent consultant model.

As an independent consultant, you are the captain of your ship. You work directly with clients, deliver projects single-handedly, and manage all aspects of your business operations.

This model is an excellent fit if you prefer maintaining flexibility and having hands-on involvement in every project. It requires a high level of expertise in your niche and solid business and time management skills.

The consultancy firm model

In the consultancy firm model, you set up a team of consultants, each contributing their unique expertise. You focus on leading the organization and contributing to client projects.

This model allows for scalability and an expanded service offering, making it a viable option if you’re targeting large businesses and complex projects. However, it also comes with increased team management responsibilities, including hiring, training, and retention.

The productized consulting model

Productized consulting takes a unique approach to consulting services.

Instead of delivering bespoke advice and solutions, you build a standardized “products” suite based on your expertise. These could range from online courses and digital tools to books and webinars. You sell these to clients at a fixed price, creating a scalable source of passive income.

This model allows you to leverage your knowledge and reach a wider audience, but it requires product development and marketing skills.

The hybrid consulting model

A hybrid model is a fusion of two or more models tailored to your preferences and business goals. For example, you could combine independent consulting with productized services, delivering personalized consulting while offering pre-packaged digital resources.

This model gives you the flexibility to design a business that aligns with your skill set, work style, and the needs of your target market.

The networked consulting model

In the networked consulting model, you collaborate with other independent consultants, forming a network of specialists. You refer work to each other, collaborate on projects, or even pitch together as a virtual firm for more significant contracts.

This model allows you to extend your service offering and reach without the overheads of running a firm. It requires strong networking skills and forming mutually beneficial professional relationships.

The subscription consulting model

In this model, instead of charging per project, you offer your consulting services for a regular subscription fee. Clients get a certain amount of your time or specific services each month.

This provides steady recurring revenue and allows you to form deeper client relationships. It suits consultants whose services involve ongoing work, like business coaching, digital marketing, or I.T. support.

Each of these models has advantages and challenges, so choosing a model that aligns with your goals, preferred working style, and the needs of your target clients is crucial.

Need some help getting started? Check out our no-nonsense guide to writing a business plan . It’s packed with insights and free downloadable business plan templates designed to help you take your business from a dream to a reality.

3. Choose your legal business structure

Embarking on your consulting business journey, you’ve got to make a few critical decisions – like the kind of business type you want your business to be.

It might seem a bit dry, but this stuff is essential, as it affects everything from tax filings and liability to local, state, or national rules you need to follow.

There are different legal business structures to choose from, and for those starting, it can feel like trying to order food in a foreign language.

Here’s the thing – don’t feel pressured into registering your business immediately. Sure, becoming a sole proprietor might be easy on the wallet and quick to set up, but it could leave you open to more risk and potentially create a tax headache.

Forming a Limited Liability Company (LLC) could be smarter for most consulting gigs.

Invest some time into researching the business structures that could suit you. Consider which will benefit your business now and align with your future professional and personal ambitions.

Let’s look at the four main types of business entities:

• Sole proprietorship. This is the simplest entity. As a sole proprietor, you’re the lone ranger responsible for your business’s profits and debts.
• Partnership . This is when two or more people team up, sharing liability and responsibility for a business.
• Limited Liability Company (LLC). This structure allows owners, partners, or shareholders to limit their personal liability while reaping a partnership’s tax and flexibility perks.
• Corporation . This is a separate legal entity from its owners. A corporation can own property, get sued, pay taxes, and enter into contracts.

Consider what will work best for your current needs and future ambitions.

Hire an expert to form your company and save time. Our trusted partners can help: Northwest ($39 + state fee) or Bizee ($199 + state fee) . We recommend Northwest. After evaluating the leading registration companies, Northwest stands out as our top choice due to its competitive pricing, exceptional customer support, and commitment to privacy. Pay just $39 + state fees and you'll get a free year of registered agent service, articles of organization, privacy, and client support from local experts.

And a heads up – in most states, if you’re planning to run your consulting firm under a different name than your legal business name, you need to register this with the secretary of state or county clerk.

For instance, if your registered company is an LLC named “Three Brothers, LLC,” but you’re selling services as “Three Tigers,” you might have a problem. That’s because your registered name and your trade name don’t match.

But don’t worry, this is not as scary as it sounds. You can sort this out by registering your trade name with your state (and or local government) by filing a “doing business as” (DBA) certificate. Also known as an “assumed name,” “fictitious business name,” or “trade name.” Need help? Check out this super handy resource that breaks down what a DBA is, the state requirements for a DBA, and how to file a DBA in all 50 states and U.S. territories .

3. Set up business accounting and bookkeeping

Let’s talk about something I find less cool but super important – business accounting and bookkeeping . This stuff is vital to understanding your cash flow and filing taxes correctly.

Accounting is all about recording, organizing, and presenting your financial info. It’s the backbone of your business’s financial health, helping you make informed decisions.

Bookkeeping is more about recording, storing, and retrieving your financial data.

Sure, the two overlap. But the significant difference? Bookkeeping is about recording and categorizing financial info, while accounting uses that info for analysis, strategy, and tax planning.

Hire a bookkeeper – your new best friend

Unlike accountants, bookkeepers have a simple mission: keep things organized, pay bills, track an invoice financing loan , and prep work for the accountant. They’re typically more wallet-friendly than CPAs (certified public accountants) and can handle day-to-day transactions, bank account balancing, basic reports, and keeping your financial records tidy.

Many consultants hire an external bookkeeper, paid hourly, who swoops in regularly to manage entries, bills, invoices, and receivables. The best part? They don’t need to be in your office 24/7. They can work remotely or drop by every couple of weeks.

An experienced bookkeeper isn’t just handy; they’re a lifesaver, especially when setting up invoice financing to speed up client payments. Plus, with the help of tools, a free invoice template , or invoicing software from Billdu for creating and managing invoices, they can help you be more efficient and less stressed.

Organize your financial information

Every business generates heaps of data; if it’s not organized and accessible, it’s as useful as a chocolate hammer. This is doubly true for your consulting gig. Even a few weeks of unrecorded transactions or a month of unmailed invoices can drown a small business.

A sharp bookkeeper can help you set up a filing system, keep bills organized, ensure invoices are sent out promptly, and introduce a disciplined, organized approach. They can even help set up and track invoice financing loans if clients are slow on payments.

Perform an annual health check

Don’t underestimate the value of a yearly review of your bookkeeping, accounting, and tax strategies. Give a hard look at your systems and the people managing them, and ask some critical questions.

Are you being cost-effective and productive with your accounting? Does your CPA understand your industry enough to give solid advice? Is your tax preparer skilled enough to keep you on the right side of the law? Most importantly, can you trim expenses while maintaining high-quality controls?

Take the time to reevaluate and bolster your accounting strategy. It might seem like a chore, but trust me, it’s worth it!

4. Assess your finances and secure startup capital

Let’s talk money. Assessing your finances is super important – it’s not just about tracking sales and profits but getting a complete picture of your financial health.

So, here’s the rundown on business finance:

Business finance is like your company’s personal trainer. It uses your financial data to help you manage your funds, making your operations profitable and sustainable.

And you’ve got plenty of business financing options.

You must figure out how to fund your business and fuel its growth. You’ll struggle to build a sustainable, profitable business if you’re not on top of your numbers.

Starting a business is exciting, but don’t let the excitement push you to overspend. Be careful with your funds and make purchases that make sense.

Expensive and unnecessary equipment? That’s a no-no. They might seem cool, but they could put your small business’s survival on the line.

Your startup costs may include the following:

• your brand design (logo, business cards , and website)
• any license or permit fees
• deposits and rent for a physical work location (if you plan to lease your own office space)
• basic infrastructural costs like VoIP phone and internet service, scheduling and invoicing software , etc. You can reduce costs by picking invoicing software that includes automated tax compliance.
• marketing and advertising costs

Here’s the upside – most successful consultants can run their businesses with low costs until they’ve built a solid client base, then they can spend more on equipment and supplies.

Securing startup funding

Securing sufficient capital is a major hurdle for new businesses. While self-funding is ideal, it’s often not feasible, making business partners or outside investors essential.

Before engaging potential partners or investors, clarify your expectations:

• What do you want from this partnership or investment?
• How involved should they be in decision-making?
• Is the relationship short-term or long-term?

Your partnership can take various forms: pure capital investment, cost-sharing, leads generation, or associating with a reputed brand. Knowing your goals upfront helps in selecting the right partner or investor.

Consider these relationship options:

• Crowdfunding. Platforms like Kickstarter and Indiegogo allow raising funds from the public without granting them business control. However, it requires fulfilling commitments made to backers. Crowdfunding may not suit consulting businesses, but its growing popularity, projected to exceed the global venture capital industry, makes it worth exploring.
• Angel investors and venture capitalists. These traditional funding sources suit those planning a consulting agency. Convincing investors about your business viability is challenging, particularly for startups. However, finding investors becomes easier if you have a profitable consulting business looking to scale, particularly in technology. Remember, they may want significant involvement in your business to safeguard their investment.
• Partnerships. True business partnerships involve an equal investment of finances, resources, and labor. Alternatively, you can establish temporary partnerships with existing brands or consultants who complement your services. Here are two examples: (a) Partner with a consultant in a related field to offer combined services to a broader client base; (b) Collaborate with a software business in your field to create a lead exchange program, driving well-qualified leads to each other. The crux is finding a partner who shares your goals and fostering mutual motivation to succeed.
• Strategic alliances. This is a collaboration where you and another business agree to combine resources to achieve a common goal. For example, a marketing consultant might form a strategic alliance with a graphic design firm . Together, they could offer a more comprehensive service to their clients. Both businesses retain their independence but might share costs, risks, and rewards.
• Joint ventures. A joint venture (J.V.) is a business agreement in which parties agree to pool their resources to accomplish a specific task or business activity. Unlike a strategic alliance, a J.V. often results in the creation of a new business entity. For instance, two consulting firms might create a J.V. to tackle a market segment neither could own. This type of arrangement typically involves more commitment and investment than a strategic alliance but can lead to greater rewards due to the combined strength of the partners.

Finally, remember that accounting and bookkeeping system we discussed earlier? It’s back in play here. You need to set up one to keep tabs on your finances. It’s essential for understanding cash flow and filing taxes, but it also helps you track income, expenses, capital expenditures, profit, loss, EBITDA, and so on.

5. Develop your brand identity

Think brands are only for the big corporations?

They’re super crucial for small businesses, especially independent consultants.

A solid brand adds a layer of professional polish that can be tricky for small outfits to establish. So, don’t leave your brand identity to fate – building a successful consulting biz requires serious attention to branding .

Let’s rewind – your brand is your company’s public persona. Ideally, it should reflect your business’s best and most vital traits.

For consultants, credibility is king. A lackluster brand identity undermines that.

Good design isn’t just a luxury – it’s essential for you and your clients.

Picture this – you’re selling $10,000 projects and want to double the price. To do that, you must articulate the value differently, and design can help.

Before you dive into networking, ask yourself some key questions. What persona do I want my brand to project? Who needs my services? What unique value do I offer? What are my brand values ? What’s the core part of my client’s experience? Your answers will shape your brand’s core and influence your future branding decisions, from your company name and logo design to your website design.

And remember, you don’t have to break the bank to create a strong brand identity. Here’s a guide to help you figure out the sweet spot for pricing:

• How much should a logo design cost?
• How much does a business card cost?
• How much should brochure design cost?
• How much does website design cost?

These guides cover various price points, so you’ll find something that fits your budget.

Ultimately, building a successful consulting business is about brand authenticity and connection . A compelling brand can make that happen. Whether you’re starting or thinking about a rebrand , take the time to think about your brand. It might make all the difference.

For more on establishing and maintaining a consistent brand identity, check out Grow Your Small Business with Consistent Branding .

Marketing psychology can help you increase revenues

Marketing Psychology can help you boost your revenues by incorporating psychological principles into your marketing strategy.

6. Create an effective fee structure

Creating an effective fee structure starts with understanding your operating costs – rent, utilities, subscriptions, taxes, supplies, and salaries. But don’t forget to factor in profit, which is crucial for business sustainability. And remember to pick a an appropriate consulting model.

Envision how you want to run your consulting business – a brick-and-mortar agency, a home office, or a global setup while traveling. Your fees should support this style. For various strategies, see this article by Andrea Coutu of Consulting Journal.

Thoroughly dissect your operational costs, which stretch beyond fixed and variable expenses like rent, utilities, and supplies, to incorporate aspects like:

• Time investment. Calculate the non-billable hours spent on marketing, administration, and skill enhancement.
• Risk mitigation. Factor in a buffer for unforeseen circumstances or potential risks, such as project overruns or unexpected costs.
• Profit margin. Explicitly ascertain a profit margin that compensates for your expertise and ensures business growth.

Next, conduct a robust analysis of:

• Competitor pricing. Understand competitors’ pricing strategies and identify market gaps or opportunities.
• Clients’ paying capacity. Evaluate the financial bandwidth of your target audience and what they’re willing to pay for your services.
• Unique Value Proposition . Gauge how your unique offerings and expertise can justify a premium or competitive pricing strategy.

Your pricing should resonate with the tangible and intangible benefits clients derive. To augment your perceived value:

• Showcase expertise. Use case studies, testimonials, and certifications to validate your expertise and results.
• Brand positioning . Ensure your branding, from website design to communication, exudes professionalism and competence.

Next, explore, understand, and select a pricing strategy that aligns with your services and client expectations:

• Hourly rate. Transparent and straightforward, this method is often suitable for consultants with clearly definable hourly services, such as legal consultants or I.T. troubleshooters. However, tracking hours is essential; questions may arise if work takes longer than estimated.
• Project rate. Ideal for projects with clear deliverables and defined timelines, like marketing campaigns or project management services. This could be risky if the work takes longer but beneficial if completed quicker. Adjustments may be needed for scope changes.
• Retainer. Suitable for ongoing, long-term services, such as H.R. consulting or business advisory, where clients require access to your expertise over a period.
• Value-based pricing. Charging is based on the value provided to the client, which can be highly profitable for consultants who significantly impact client revenues or costs, such as business strategy consultants or revenue growth advisors.

Additional revenue streams

Beyond direct consulting, explore alternative revenue avenues:

• Online courses. Leverage your expertise to educate others, ensuring a revenue stream decoupled from your consulting hours.
• E-books or guides. Create comprehensive guides or e-books based on your area of expertise, providing a low-cost option for those unable to afford your full services.
• Affiliate marketing. Recommend tools or services and earn a commission for each sale made through your referral.

Periodic review and adjustment

Ensure your fee structure remains viable and competitive through:

• Client feedback. Understand client perceptions and reservations about your pricing.
• Market trends. Stay attuned to shifts in market rates or emerging pricing strategies.
• Business evolution. As your expertise and offerings evolve, ensure your pricing reflects these advancements.

For more on fee setting, check out this online mini-course by Consulting Journal.

Consider offering online courses if you have unique expertise. It’s another revenue stream for your consulting business. Here’s a guide on how to sell online courses .

7. Launch your website and market your business

Your business website is not just a digital address; it’s your brand ambassador. Use your site to effectively communicate your brand ethos, values, and services to your target audience.

It’s crucial that your website truly personifies your consulting brand. For example, suppose you’re running a leadership consulting service emphasizing transparency and innovation. In that case, the site should have a modern, clean design with easy-to-navigate menus and transparent information about your services.

The website’s visual design elements should resonate with your brand’s voice and identity. For instance:

• Use your brand’s colors. If your brand colors are turquoise and white, these colors should be prominently displayed in your site’s design. For example, a sustainability consulting company might use green and earth tones to reflect their environmental commitment.
• Feature your company logo. Your logo is a visual shorthand for your brand, and it should be prominently displayed, preferably in the header or corner of every page.
• Write marketing copy for your target audience. Your website copy should speak directly to prospective clients’ needs and interests. If you’re a technology consultant, use language that tech-savvy visitors will appreciate and understand.
• Showcase your consulting style. Whether you’re more hands-on or prefer to guide from the sidelines, ensure this is evident. For example, a dynamic, interactive website may indicate a more engaging consulting approach.

Beyond these design elements, your website is an ideal platform to highlight your consulting achievements.

Feature testimonials and case studies from past clients to showcase your expertise and success. For example, a healthcare consultant might include a case study on how they helped a hospital streamline its processes for better patient care.

Including an online store on your website can be a strategic move, especially if you have proprietary consulting tools, books, or digital resources to sell. For example, a marketing consultant might sell eBooks or webinars on the latest marketing strategies.

Passive income can bolster your bottom line and is an important safety net for lean seasons.

Marketing your consulting business

Being an exceptional consultant is only half the battle; marketing yourself effectively ensures your talents don’t go unnoticed.

If you’re not selling your services, there’s a good chance that no one is. So, you’ll complete your current contracts to find an empty calendar with no income looming ahead. As a result, you’ll miss many opportunities to generate ongoing online marketing income and may need to start from scratch.

Establishing a steady pipeline of clients and potential clients involves spreading the word about your consulting services to your target market.

Ultimately, you’ll write many client proposals , so get used to doing so early in your consulting practice.

Client proposals are your chance to show how you can help clients solve their problems. You’ll need to be clear about the project’s scope, the services you provide, what you’ll charge for the services, the deliverables, and the time frame, and use an electronic signature tool to bind clients legally. And be sure you show how you and the client can measure the results.

One proven method to gain traction in consulting and attract clients is to share your expertise extensively.

Networking at industry events relevant to your clients can be a goldmine for insights about industry trends, networking with current and prospective clients, and leveraging word-of-mouth referrals to generate fresh consulting leads. For example, if you’re a technology consultant, participating in tech expos or conventions can put you directly in contact with potential clients.

Participating in events catered to the consulting industry could also be beneficial, as you can build connections with other consultants and potential clients. This could also expose you to different approaches to delivering a persuasive value proposition when offering your consulting services to clients.

When attending these events, carry business cards and brochures about your services, complete with contact information, including a phone number. While email communication is prevalent,   other tactics like an email signature can help strengthen your business communication and establish trust with prospective clients.

In your marketing collateral, include the following:

• A comprehensive overview of your services
• A persuasive argument about why you’re the best choice
• Convincing reasons to hire you
• A concise biography containing relevant information
• A snapshot of your existing client portfolio

Also, consider exploring content marketing strategies tailored for consultants. Writing an ebook about your field of expertise or maintaining a regular blog can help establish you as an authority in your niche, improve your search ranking through SEO practices, and gather email leads. For example, a leadership consultant could blog about the latest trends in leadership and management, drawing from their own experiences and insights.

As a burgeoning business owner, capitalize on the exposure offered by social media marketing . Platforms such as Twitter , Facebook, and LinkedIn can help build an audience of followers.

Regularly post helpful tips, insights, and articles related to your services. By engaging with your followers and participating in relevant discussions, you present yourself as a subject matter expert, reinforcing your reputation as a knowledgeable and reliable consultant.

Invest in a social media management tool like Buffer for scheduling posts beforehand, freeing up your day to focus on clients. However, regular check-ins are essential to address client inquiries promptly.

Consider collaborating with micro-influencers in your industry, as aligning your brand with theirs can boost credibility and accelerate growth.

Here are other marketing strategies and tactics that can help you grow your consulting business:

Host free workshops or webinars

Free educational content through workshops or webinars can exhibit your expertise and attract potential clients.

Best for: I.T. consultants, marketing consultants, and management consultants. Not good for: Legal consultants, financial advisors, medical consultants.

Collaboration and partnerships

Join other consultants or businesses to expand your client base by providing complementary services. Best for: Technology consultants, business strategy consultants, marketing consultants. Not good for: H.R. consultants, independent financial consultants, health & safety consultants.

Whitepapers and case studies

Publishing in-depth whitepapers and client case studies demonstrates your skills and past successes. Best for: Data analytics consultants, research consultants, and financial consultants. Not good for: Image, lifestyle, or social media consultants.

Leverage client testimonials

Use your positive feedback and testimonials from past clients in your marketing materials to build trust. Best for: Management consultants, education consultants, H.R. consultants. Not good for: Cybersecurity consultants, legal consultants, crisis management consultants.

Join online forums and groups

Engage in online communities related to your niche, offering advice and establishing your expertise. Best for: Tech consultants, SEO consultants, freelance writing consultants. Not good for: Medical consultants, corporate strategy consultants, or tax consultants.

Implement a referral program

Reward existing clients for referring new clients to your consulting business. Efficient referral program software can streamline this process, making it easy to track and reward referrals. Best for: Career consultants, small business consultants, fitness consultants. Not good for:  Forensic, industrial safety, and agricultural consultants.

Pitch to local media

Offer your expertise for free to local media in exchange for publicity.

Best for: Personal finance consultants, relationship consultants, wellness consultants. Not good for: I.T. consultants, biotech consultants, energy consultants.

Speak at conferences

Presenting at conferences can establish you as an authority and help network with potential clients.

Best for: Environmental consultants, scientific researchers, marketing consultants. Not good for: Personal shopping, etiquette, or hobby consultants.

Engage in direct email marketing

Sending targeted emails with valuable content to a segmented audience can generate leads. Best for: Sales consultants, digital marketing consultants, and e-commerce consultants. Not good for: Grief consultants, child behavior consultants, or art consultants.

Local business community involvement

Engaging with local business communities or chambers of commerce can help foster local client relationships. Best for: Retail consultants, local marketing consultants, and hospitality consultants. Not good for: International trade, space, and research & development consultants.

Sharing regular posts about industry insights or tips showcases your expertise and improves your website’s visibility on search engines. Best for: Marketing consultants, career coaches, nutrition consultants. Not good for:  Privacy consultants, forensic consultants, chemical consultants.

Hosting online seminars can display your knowledge to a wide audience and attract potential leads. Best for: Financial consultants, I.T. consultants, marketing consultants. Not good for: Art consultants, fashion consultants, or local retail consultants.

Creating or participating in podcasts can help you reach new audiences and discuss industry trends and insights.

Best for: Personal development coaches, financial advisors, and health consultants. Not good for:  Cybersecurity consultants, data privacy consultants, industrial consultants.

Speaking and teaching

Leading workshops or courses and speaking at events can build your reputation and network. Best for: Business consultants, educational consultants, leadership consultants. Not good for:  Legal consultants, risk management consultants, chemical safety consultants.

Social media marketing

Using platforms like LinkedIn, Twitter, and Facebook to share content and engage with followers can enhance your online presence and credibility.

Best for: Social media consultants, branding consultants, travel consultants. Not good for:  Data security consultants, industrial safety consultants, forensic consultants.

Print or digital advertising

Placing ads in newspapers, magazines, or online platforms can promote your services to a broader audience.

Best for: Event planners, small business consultants, real estate consultants. Not good for: Scientific research consultants, aerospace consultants, and biomedical consultants.

Cold calling and emailing

Directly contacting potential clients might generate quick leads, but it might also have low conversion rates.

Best for: B2B service providers, sales consultants, and marketing consultants. Not good for:  Childcare consultants, mental health consultants, art consultants.

Remember, marketing becomes more straightforward once you’ve established a client base. According to this study , “43.7% of consultants reported that referrals were their top-earning marketing strategy”. Don’t hesitate to ask satisfied clients for referrals, as they can be a significant marketing asset.

Starting out, covering as many marketing channels as possible is wise. As you grow, you’ll naturally discover what methods work best for your consulting business.

8. Grow your consulting business

Starting a consulting business is thrilling, but it’s just the beginning. Here are five exciting steps to take your consulting business to the next level:

Study your competitors

Get your magnifying glass out and take a good, hard look at what other consultants or firms in your space are up to.

You’ll uncover their secrets to success and spot areas they’ve missed, carving out unique opportunities for you. Notice their marketing approach, service offerings, and how they price their services. A competitive analysis will give insights into your customers’ journeys and ways to make your service the top pick.

Be a storyteller

Starting a blog is like opening a window into your consulting world. It gives your business a voice, helps you become a trusted authority in your field, and boosts your online visibility.

If you’re scratching your head about what to write, your clients are your best inspiration. Address their challenges and questions in your blog posts. Plus, sharing these posts with potential clients can convince them of your expertise.

Be the thought leader

Beyond blogging, sharing your insights on social networks can amplify your reach. Use platforms like HARO to connect with journalists and bloggers who can quote you in their stories. This way, you can gain your consulting niche’s recognition as a thought leader.

Broaden your horizons

Your competitive analysis might reveal services your competitors offer that you don’t. Can you fill these gaps?

For example, if you’re a content marketing consultant, could you extend your services to include email or social media marketing? But remember, only add services that align with your expertise.

Make friends

The world is full of potential connections, and they’re only a click away from the internet. Networking online might seem tricky, but with platforms like Twitter and LinkedIn, you can spark conversations with industry peers and potential clients. Regular interaction can rekindle old connections and forge new ones.

Test these strategies and find the ones that boost your client base and help your consulting business thrive. Remember, it’s not about copying others but learning from them and building a brand that reflects you.

Grow your team

The life of an entrepreneur can often feel solitary, especially when you’re launching your consulting business. While the journey may start with you at the helm, remember the goal is to grow and expand, which calls for additional hands on deck.

After all, time is a finite resource, and you can’t run a successful consulting business burning the midnight oil every night. As your business scales up, you must delegate tasks to ensure you continue delivering exceptional service to your clients.

However, expanding your team doesn’t mean hiring without a strategy. Each new member should bring immediate value to your business. This decision is highly specific to your business, as every consulting venture has unique challenges and requirements.

Reflect on your strengths and weaknesses to determine who your first hire should be.

For instance, if marketing isn’t your strong suit, consider hiring a marketing manager to help map your business plan. Just ensure you validate their credibility, perhaps through references or evaluation letters , to guarantee they’re the real deal.

If dealing with numbers gives you a headache, a billing specialist could be your saving grace, managing accounts and ensuring payments are collected on time.

In essence, your first employees should fill the gaps in your expertise. Building a well-rounded team ensures a sturdy foundation for your business.

For many entrepreneurs, the first hire is often a part-time virtual assistant – a jack-of-all-trades ready to dive in, learn, and grow with the company. This person should be reliable, proactive, and have a strong work ethic. Having someone dependable on your side will make your journey less stressful and more enjoyable.

So, take a moment to reflect: what does your business truly need? Who could help turn your weaknesses into strengths and pave the way for your consulting business to thrive?

Start your consulting journey today

Venturing into entrepreneurship, especially after years of enjoying the safety of a salaried job, can be daunting.

The fact that you’ve made it this far in the article indicates a spark within you, a desire for something more fulfilling, more liberating.

Starting a consulting business can be a transformative journey, not just a decision. It’s a courageous step, a move that speaks volumes about your passion, expertise, and readiness to shape your destiny.

Are you ready to embrace this adventure, empower others with your knowledge, and define your own path?

The world of consulting awaits your unique perspective and innovative solutions. Will you rise to the challenge and create your own consulting legacy?

Associations

• Airport Consultants Council
• American Marketing Association
• Association of Management Consulting Firms
• Canadian Association of Management Consultants
• Canadian Marketing Association
• Direct Marketing Association
• Direct Selling Association
• Information Technology Association of America
• Institute of Management Consultants USA
• International Advertising Association
• International Association of Registered Financial Consultants
• International Association for Wedding Professionals
• International Branding Association
• IWA – International Webmasters Association
• National Retail Federation
• Professional & Technical Consultants Association
• Public Relations Society of America
• Search Engine Marketing Professional Organization
• SMEI The worldwide professional association for sales & marketing
• The National Association of Sales Professionals
• The Society of Professional Consultants
• Word of Mouth Marketing Association

Frequently Asked Questions (FAQs) about consulting

1. where can a consulting business identify government contracts to pursue.

You can find government contracts on official government procurement sites such as SAM.gov in the U.S. This platform lists federal business opportunities. Remember, each country has its own respective platform.

2. Can I establish a consulting business while still employed elsewhere?

Absolutely! Starting a consulting business as a side venture is possible. It allows you to test the waters and build a client base without risking your current employment. Just ensure that there’s no conflict of interest with your present job.

3. Which are promising sectors to launch a consulting business in?

The best field for your consulting business depends on your skills, experience, and passion. However, industries like I.T., H.R., business strategy, healthcare, and environmental sustainability are seeing high demand for consultants.

4. What credentials are required to start a consulting business?

While there are no specific requirements to start a consulting business, having relevant qualifications, certifications, and experience in your chosen field will boost your credibility and attract potential clients.

5. How can I price my consulting services?

Pricing can be based on factors like market rates, the complexity of the work, the client’s budget, and your experience. You can choose an hourly rate, a per-project fee, or value-based pricing.

6. How do I market my consulting business?

Multiple channels to market your consulting business include networking, social media marketing, blogging, speaking engagements, and email marketing. Highlight your unique value proposition and expertise.

8. Is a business plan necessary for a consulting business?

It’s not necessary but highly recommended. It provides direction, helps you understand your market and competition, and is necessary if you seek funding.

8. How can I differentiate my consulting business from competitors?

Differentiating your consulting business requires you to clearly articulate your unique value proposition, leverage your unique skills or experience, specialize in a niche, provide excellent customer service, and build a strong personal brand.

9. Should a consulting business be incorporated?

Incorporation can provide benefits such as limited liability, tax advantages, and a professional image. It’s advisable to consult with a legal professional or business advisor to understand the best structure for your business.

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How to start a consulting business in just 7 steps

• 12 min read

What is a consulting business?

• steps to start a consulting business in 2024

Can anybody start a consulting business?

Copilot: how consultants manage their consulting business.

Start your consulting business

Copilot gives consultants the tools they need to start, run, and grow their business. Try it for free!

Two years ago, I realized that what I was doing at my 9-5 job could easily be turned into a consulting business where I made my own hours and decided who I wanted to work with.

Time flexibility, autonomy, and income potential were at the top of my list of things I wanted to accomplish.

But, I also noticed that there were many consultants and agencies in my niche giving lackluster advice. I wanted to bring a new approach and be a guiding light to business — which is what essentially allowed me to consistently bring in new clients and help me achieve what I wanted in terms of time freedom and finances.

However, starting my consulting business isn’t something that happened overnight. In fact, when I quit my job, it took me almost a full year to figure out what I was doing and to make any sort of living income.

But, don’t let this discourage you. I clearly made A LOT of mistakes. When I first started, it felt like trying to scale Mount Everest barefoot. Though it seemed like an impossible task, the journey need not be so daunting.

This guide is your sherpa up that mountain, offering practical steps on identifying your niche expertise, creating an effective business plan based on client pain points, and managing finances like a pro. We'll even dive into legal aspects and relationship-building strategies for long-term success.

Intrigued? Let’s make this journey together!

A consulting business, at its core, is about problem-solving. It's where an expert in a specific field offers advice and strategies to individuals or companies who need it.

This kind of business opportunity can be highly rewarding since businesses are always looking for ways to enhance productivity, generate more revenue, and find solutions to intricate issues.

The essence of being a consultant lies not just in having specific knowledge, but also knowing how to apply that knowledge effectively. That's why experience plays such a crucial role here — the more problems you've solved before, the better equipped you'll be to tackle new ones.

In addition to solving problems, consultants often help with implementing solutions too. This might involve coaching team members on new processes or helping set up systems that facilitate improvement.

Consulting spans many industries — from IT and management, all the way to finance and HR. What ties them together? The fact they're built around offering specialist insight others don't have access to.

Now, let’s get into the steps you can take to start your own consulting business. These steps are based on my own experience of starting my marketing consulting business two years ago.

7 steps to start a consulting business in 2024

Here are nine steps on how to start a consulting business:

• Master a craft in a specific niche
• Create a business plan based on pain points
• Setting up your online workspace
• Marketing your business to acquire clients
• Managing cash flow and your finances
• Building relationships and referrals
• Taking care of the legal stuff

Okay, let’s dive deeper into each step.

1. Master a craft in a specific niche

Before you launch your consulting business, hone your skills to become a master in the specific niche. It's insufficient to just be familiar with an industry or field — you need to excel .

Your clients will rely on your expertise and advice for their business decisions. If you aren't fully equipped with deep knowledge of the field, it might lead to ill-advised guidance which can harm both parties involved .

This doesn't mean spending decades working in that particular field before taking the plunge into consulting though. But yes, having years of experience would certainly add credibility.

Finding your niche

Choosing a niche isn’t as complicated as it sounds — it’s all about identifying where your passion meets proficiency. Start by analyzing what interests you most and then look at how proficient or skilled are in that area. Here’s some help if needed.

Becoming an expert

To achieve mastery in any given domain, consistent learning is crucial along with hands-on experience. HubSpot has detailed insights on how anyone can grow from being good at something to becoming great.

Avoid client disservice

If I’m honest here, entering consultancy without sufficient expertise may do more harm than good to your client’s businesses due to its high-stakes nature (depending on the industry). This reinforces why mastering a craft within a chosen niche is non-negotiable when thinking about starting your own consultancy business.

2. Create a business plan based on pain points

Building your consulting venture starts with a solid game plan. A solid business plan addresses the real issues potential clients face in their businesses.

To start, you need to know what keeps your target market up at night. Your expertise should align with these concerns and provide solutions that alleviate them.

The next step is setting goals for your consulting business that directly address these pains. This will not only guide the direction of your services but also show prospective clients how valuable you can be to their success.

You'll then want to map out strategies for attracting new customers who experience these specific problems. The aim here is to position yourself as an expert problem-solver within this space.

Try looking in online communities for what problems and conversations are happening in your niche. Reddit is a great place to start if you’re not sure where your community hangs out. Try Googling something related to your niche and type in “reddit” after to see what conversations show up.

And last but not least, sketch out financial projections considering all these factors into account. Here’s where you’ll outline anticipated income streams and expenses tied specifically to solving client problems — this helps ensure sustainable growth for both parties involved.

Note: Don't forget tools like Copilot make managing finances easier by offering features such as invoice templates and third-party integrations like QuickBooks.

Once you have a general idea of what your goals and objectives are, it’s time to take some tangible action.

3. Setting up your online workspace

If you're about to start a consulting business, getting organized is crucial. But it doesn't mean having papers and sticky notes scattered all over your desk.

Your workspace needs to be as digital and streamlined as possible. This is where Copilot , a modern client portal for service businesses, comes in handy.

The power of Copilot: Everything at your fingertips

Copilot offers an intuitive platform that lets consultants manage everything from contracts , invoices, files, messaging, intake forms, and more in one place. Imagine having a clutter-free desktop but with access to every essential tool needed for your work.

A community you can count on

You might be wondering if this setup works for other consultants too. Absolutely. In fact, one of the largest customer bases of Copilot consists of successful consultants who decided to streamline their operations digitally.

Copilot isn’t just about managing paperwork, it's also about fostering relationships with clients through seamless communication features built into the system. It keeps conversations flowing smoothly while making sure important messages don't get lost in translation or buried under heaps of emails.

Say goodbye to disorganization chaos

To say starting a consulting business can be chaotic would be an understatement. But thanks to tools like Copilot, keeping track becomes less daunting and more efficient — letting you focus on what truly matters: providing exceptional services for your clients.

4. Marketing your business to acquire clients

Realizing who requires your services is the key to advertising them successfully. To stand out in the crowded market, you need a unique selling proposition (USP) . This is what sets you apart from others and makes clients choose you over competitors.

Once you figure out who you want to speak to, and what you want to speak about, it’s time to figure out how you’re going to reach your ideal clients. Many consultants initially take an outbound approach — usually reaching out to prospective clients via LinkedIn.

Social media platforms are excellent places for promoting your consultancy. You can use these channels to share valuable content related to your niche, positioning yourself as an expert.

However, note that taking the “content creation” route on social media can take a while to see some tangible results. This is definitely the route to go down for the long term. But, if you’re just starting out, you need to sign your first client as quickly as possible. And, to do this, many consultants (myself included) do a cold reachout approach.

Email remains one of the most effective ways to reach potential clients directly. An email newsletter filled with insightful advice can be just the thing that converts prospects into paying customers.

If you have the time, you can also go to events related to your industry and network with people. The rate of how efficient this will be depends on your industry. For me, as a marketer, this wasn’t the best option as it is very time-consuming (and I’m sort of an introvert). But, for non-tech-related industries, this is often a great place to start.

Some things you can do to network include:

• Nurture relationships within professional networks such as LinkedIn or industry-specific forums.
• Join local business groups and attend events where prospective clients might hang out.
• Talk at conferences or webinars — sharing knowledge helps build credibility and attract potential leads.

As your business grows, you can shift your focus to acquire clients “passively.” By passively, I mean inbound marketing. Here are some strategies:

• A well-optimized website attracts organic traffic; consider SEO blogging regularly on topics relevant to your expertise.
• Publish whitepapers or case studies demonstrating how you've helped previous clients achieve their goals. It’s proof that gives confidence.
• Copilot's client portal software , a powerful tool used by many consultants like myself, integrates smoothly with other marketing tools, letting you automate processes and focus more on delivering value.

5. Manage Cashflow and Your Finances

Running a successful consulting business isn't just about your expertise. It's also about smart money management. In the early days of your business, you’ll most likely act as the CEO, CMO, COO, and CFO — yeah, it’s a lot. But you’ll gain a lifetime of experience in a short amount of time.

One of the most crucial “roles” early on will be the CFO (chief financial officer). Most businesses die because they run out of capital. So, don’t take this aspect lightly.

When starting out, consider packaging your services . Determine the appropriate pricing for your consulting services that is competitive yet does not undervalue yourself. Don't undersell yourself but make sure you're still competitive.

Invoicing made easy with Copilot

Sending invoices shouldn’t be a chore. With Copilot’s invoicing feature , it doesn’t have to be. Create branded invoices and even set up recurring subscriptions — no sweat.

Also, to manage cash flow effectively, keep track of all expenses – both big and small. From office supplies to travel costs, every penny counts. This is where integrations with your back office platform, like Copilot, comes in handy.

Copilot integrations make life easier

Fumbling between different apps? Let Copilot do the heavy lifting by integrating with third-party applications like QuickBooks for seamless financial management.

6. Building relationships and referrals

You might be wondering how to get more clients for your consulting business. The secret? It's all about building solid relationships.

People trust people, not businesses . So it's crucial that you focus on developing genuine connections with your clients. They're much more likely to recommend someone they like and trust — that could be you.

In my marketing consulting business, after just two years of dedicated relationship-building, I started seeing a consistent stream of client referrals from past customers I'd done great work for. This is the power of word-of-mouth.

The power of networking

Beyond individual clients, don't forget the potential power within professional networks too. Connect with other consultants or professionals in related fields — these contacts can also provide valuable client referrals if they know and respect your work.

Maintaining client relationships

Maintaining those strong bonds even after projects end is equally important because happy clients are the best advertisers for your services. Regular check-ins let them know you value their partnership long-term.

Acing customer service

Finally, ace customer service at every step along the way. Delivering high-quality results is a given but being responsive, respectful, and easy to work with gives added reasons for referral recommendations.

Remember: Happy clients = more referrals.

7. Take care of the legal stuff

To start a consulting business, you'll need to tackle some paperwork first.

Make sure to check your local laws and register your company name with the authorities in your area so they know you're ready to conduct business and pay taxes. Registering your small business with the local government informs them that you're in operation and prepared to pay taxes. It might sound daunting, but it's not as scary as it seems.

Choose your business structure

The type of structure can affect how much you pay in taxes and your personal liability. Do some research or get help from an attorney or CPA. In the US, many consultants operate with an LLC (Limited Liability Company). But, this will all depend on your preference and practice.

You’ll also want to open a separate business bank account to separate your personal finances from that of your business. This will help you avoid headaches when it comes to tax season.

Nail down licenses and permits

You may also need specific licenses or permits depending on what kind of consulting work you do. For example, if environmental consultancy is your thing, certain certifications are required.

Tax obligations

Avoid any unpleasant surprises by understanding tax obligations upfront. Are you aware that consultants often have self-employment tax?

Breathe easy with liability insurance

Last but certainly not least, consider getting liability insurance for peace of mind because accidents happen even when we wish they didn't. This isn't everything there is to starting a consulting biz legally, but these steps will set solid foundations.

Well, the short answer is yes. But it's more about who should. The truth of the matter is that anyone can technically become a business owner and start a consulting firm. You don't need any special license or degree to hang up your shingle and call yourself a consultant.

This may seem like great news for those itching to escape their nine-to-five grind and set off on an entrepreneurial adventure.

However, there's more than meets the eye

Becoming successful in this field requires something money can't buy — expertise. It’s not just about having knowledge; it’s also about being able to apply that knowledge effectively for clients' benefit.

Your success hinges on demonstrating your skills in tangible ways. This could be through past work experience, professional certifications, academic achievements, or even client testimonials praising your abilities.

To really hit home with potential clients and succeed as a consultant you'll need a solid business plan. This helps demonstrate how you're going to solve problems for clients — essentially why they should choose you over someone else.

Above all else though, remember confidence counts. To thrive as a consultant you must believe in yourself before expecting others (clients) will too.

The journey of starting a consulting business is an adventure filled with twists and turns. But one tool that can help smooth out the bumps in this road is Copilot.

Crafting your workspace with Copilot

A well-organized workspace is essential for success, and that's where Copilot shines. This client portal platform lets you keep track of contracts, invoices, files, messaging, and forms all in one place.

Financial management made easy

No need to dread financial management anymore. Copilot makes it simple by letting you create branded invoices and recurring subscriptions right from your dashboard.

Bonus? It even integrates seamlessly with third-party apps like QuickBooks so you have everything under control without breaking a sweat.

Fostering client relationships

I've been running my marketing consultancy for two years now — believe me when I say relationships are key.

If done right using platforms like Copilot can get consistent referrals from past clients who loved working with us because we did an amazing job managing their projects smoothly through the portal.

Growing Your Consulting Business With Confidence

In conclusion, there’s no doubt about it: Starting a consulting firm isn’t easy. But, having tools such as Copilot on your side gives both newbies & experienced consultants the confidence they need to grow their businesses effectively and efficiently.

Launching a consulting startup is a complex adventure that goes far beyond just announcing your readiness to serve. Finding your niche where your expertise aligns with industry trends and new business needs is key.

If you’ve made it this far into the article, you've mastered the art of crafting an effective business plan that's not just a document, but a strategic roadmap addressing the real pain points of new clients. We've dove into client portals, equipping you with robust online workspace setups and innovative marketing strategies to captivate and retain clients .

We navigated the financial landscape, providing practical advice on project management tools like Copilot, designed to streamline your invoicing and financial tracking — crucial for any entrepreneur eager to maintain a healthy cash flow. We also shed light on the significance of relationships in the consulting industry — these connections are not merely advantageous but are the lifeblood of referrals and sustained growth.

Legal stuff? Consider it covered. Everyone is now equipped with the knowledge that diligent attention to legalities and choosing the right business name from the outset can prevent future legal entanglements.

Whether you're eyeing a niche in management, IT consulting, or any of the other types of consulting, this guide has laid the foundation. You're not just starting a new consulting practice — you're sculpting a beacon in the consulting industry.

Launching your consulting business is no longer akin to scaling Everest barefoot — it's an exhilarating climb we've prepared for together. With the toolkit you've assembled, the path to success is clear, and the summit is within reach.

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Don't bother with copy and paste.

Get this complete sample business plan as a free text document.

Business Consulting Business Plan

Start your own business consulting business plan

Growth Management and Strategies

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">.

Growth Management and Strategies (GMS) is an ambitious innovative new company that is attempting to turn the small business consulting business on its head. With an experienced consultant at the helm as President, GMS intends to grow at more than 50% per year through solid customer service, a great sales plan, proven competitive strategies, and a group of people that bring dynamic energy to the company and the sales process.

The goal for this plan is financial: GMS needs a Small Business Adminstration (SBA) loan, and this document is one step in the process. It is also a road map for the company. The document gives all present and future employees, as well as the owner a sense of purpose that may exist without the business plan, but becomes more relevant after the business plan is written, reviewed, shared, and edited by all. It is a living document that will last far beyond the SBA loan purpose, or if that doesn’t occur, to bring an investor on board.

GMS’s financials are realistic, and based on very conservative sales figures relative to the industry as a whole. That is because one of the goals of GMS is to build the business one client at a time, and to serve each client as if it were the last. This is how loyalty is generated, and cultivated. Customer service is what GMS will do best, and is a large part of the company’s overall mission.

1.1 Objectives

The objectives for Growth Management and Strategies are:

• Gain access to an SBA loan upon start up.
• Grow the company from 2 employees in Year 1, to over 10 by Year 5.
• Increase revenue to over $3 million by Year 3.
• Increase client base by 450% in three years.
• Maintain job costing that keeps margins above 70%.

1.2 Mission

The company mission is to serve small business clients that are in need of logistical, technical, and business strategy services. All projects will be chosen based on the availability of human resources, and each individual employee will be given the respect of a contract worker, and will share in profits for each job. Politics have no place at Growth Management and Strategies, and to limit the affects of favoritism, the company will implement and clearly communicate a performance review policy that applies to those at the bottom as well as the top of the leadership ladder. Credit will be given to the person who performed and/or innovatively modified a project, and compensation will be both financial and in the form of commendation.

Growth Management and Strategies is a company that respects the needs and expectations of its employees and clients. If either is compromised, adjustments will be made so that the company culture may remain intact.

1.3 Keys to Success

Our keys to success are:

• To maintain client satisfaction of at least 90%.
• To keep overhead low.
• To ensure professional marketing and presentation of services.
• To provide an active and functional website.

Company Summary company overview ) is an overview of the most important points about your company—your history, management team, location, mission statement and legal structure.">

Growth Management and Strategies was established as a C corporation. The company’s headquarters are located in Boston, MA, near Copely Place. The company was established as a result of the efforts of its owner, Bill Dawson, and his experience in leading small businesses into prolonged periods of growth and innovation. Dawson worked for McKinsey before being hired away to Bain and Company. A Harvard graduate, Dawson spent hundreds of hours each week for nearly a year, slowly building the company to where it is now.

The company has had numerous successes this year, including one client that was purchased by a major multinational conglomerate, and another that experienced product sales growth of over 700% the first year.

2.1 Start-up Summary

This start-up summary table lists all the costs associated with establishing a lease, purchasing office equipment, and pulling together the other resources necessary to get the business off the ground. Furniture, LAN lines, and additional technology purchases are a must in order to properly communicate with clients, and to establish a website.

Other services included in the start-up summary are legal consulting fees, kept to a minimum thanks to resources provided by Nolo. Incorporation fees are included in the legal fees line item.

The free cash flow (cash balance) appearing in this start-up table is high relative to other small consulting businesses of its size. The owner is preoccupied with maintaining positive cash flow, and is risk averse enough to understand that during months in which contracts are not available, the corporation must sustain itself.  With this said, planned debt leverage is low, therefore risk to the lender is relatively low as well.

2.2 Company Ownership

Growth Management and Strategies is wholly owned by Bill Dawson, and is classified as an LLC.

Growth Management and Strategies offers a variety of services to the small business client. Many of the services are customized for each client, and a bidding process is observed. The company also offers a traditional fixed rate sheet for its services.

Market Analysis Summary how to do a market analysis for your business plan.">

The target customer owns a small business, and is generally dissatisfied with the revenue that the business is generating, or is dissatisfied with the daily management of their business. The customer is likely to operate a business worth between $200K and $10 million, with growth rates of between 1-10%, or even a negative growth rate.

Market growth, that is, the predicted growth in the small business sector within the Boston/Cambridge Metro area is expected to be around 3% per year. This may increase due to additional SBA lending programs designed to match the strengths of research and faculty grant work with the needs of the market and small businesses willing to take new products to market. Regardless of the market growth, the company’s customer base is far more dependant upon service needs, and a solid reputation. Mr. Dawson is well respected within the community, and has built a number of relationships with high profile individuals, and is a frequent contributor to the business section of the Boston Herald.

The corresponding market analysis table below breaks the potential market down into tactical sub-markets.

4.1 Market Segmentation

• Debt of more than 30% yearly revenue.
• Free cash flow frequently in the negative, requiring deep pocket borrowing or investment.
• Long-term growth underperforming relative to competitors.
• Management discord and performance issues.

These are not the only differentiators used to determine the market potential for a client, they are simply a starting point for the sales team as they reach out to this group of small businesses, owners and investors.

4.2 Target Market Segment Strategy

The target market strategy involves isolating potential customers by revenue, then drilling down to very specific needs via the sales team’s needs analysis methodology.

The first tier customers, businesses with over $3 million in revenue, is more experienced in outsourcing and may find themselves more comfortable hiring Growth Management and Strategies on retainer. Strategically, a retainer helps maintain consistent cash flow, even if during some months these customers will require more services than what they have paid for that month. This issue will be addressed in the Personnel topic.

The second tier customers, those businesses operating at revenue levels of $501K – $3 million, typically are very excited to have moved out of the home office stage, and into a new level of stability. If they are self-funded, these businesses can be the most challenging to work with because they are often not willing to part with company shares, and don’t yet have a sense of what kind of marketing investment is necessary to grow a business at this stage. The company will serve these small businesses based on a bid cycle, and needs analysis.

The third tier customers are easier to identify, and more ubiquitous than the rest. These small businesses are operating on $200K – $500K in revenue, often are operating out of a home, and have a firm sense of their market and potential, yet have trouble executing their plans effectively, or following through on growth strategies that generate wealth. Again, the strategy is to provide these businesses with a short needs analysis, and focus on the quantity of such customers to maintain a solid revenue stream.

4.3 Service Business Analysis

This industry is split up between a variety of players, including small businesses advising small businesses, such as the case with Growth Management and Strategies, to large conglomerate multinational consulting firms that send in newbie MBAs and use their name recognition to convince their clients that every one of these MBAs will generate over $300K a year in value. Sometimes they do, but when they don’t, GMS plans to be there.  

At the other end of the spectrum, there are a wide variety of mom and pop consulting firms owned by very talented people who simply don’t have the marketing resources or expertise to reach a broader spectrum of customer.

GMS is somewhere in between. With years of guerrilla marketing experience, and a long-term plan for success, Mr. Dawson is determined to build the company each client at a time, and to focus on a sales team that outperforms all the competitors.

GMS is planning to grow exponentially within the first two years, to over $2 million in consulting revenue. At this point the service business analysis will be re-evaluated from the outside in.

4.3.1 Competition and Buying Patterns

Typically small business clients will learn about the consulting services market through word-of-mouth experience passed on through a friend or contemporary. Still, outbound sales teams dominate this category, and the stronger your sales team and name recognition, the greater your odds of finding clients willing to place your company on retainer or accept your company’s bid. The most competitive players in this market tend to have some of the best sales teams in the industry, that is, people who know not only how to communicate the technical needs analysis in a non-technical way, but in addition, are able to follow through and execute on promises and provide accurate, industry specific information that is useful to the client even before the deal is made.

Price is also important, and operates on a complex tiered system that is dependant upon the effectiveness of a particular salesperson, the word-of-mouth (WOM) advertising already in the mind of the potential client, and the ability of the client to reform the way they think about their own business. The demands of turning a business around, or pushing it to the limits of its potential are in direct proportion to the price of each bid. GMS must be careful not to be lured into out bidding a competitor, only to find that the customer has no plans to modify their business plan, and are seeking a “magic bullet” that may or may not exist. Competition in this industry leads to frustration and burnout for many people, and it takes a strong sense of purpose to push the business beyond the realm of the high-intensity, low-return client.

Strategy and Implementation Summary

GMS will pursue a strategy in line with the experience of the owner, and implementation will be performance based and follow a clear path. Milestones are important to the implementation of this plan, and so is the vision and the will of the company’s owner, Mr. Dawson. The overall company strategy is tied very closely with the sales strategy, that is, with the front lines of the business. One of the biggest threats to any strategy is that they can become too high-minded, and not literal enough to translate into action. This will not be the case with GMS, a solid company that hires top talent and achieves it’s goals on time and on budget.

5.1 Competitive Edge

GMS has a significant competitive edge in the following areas:

• Customer service mobility – As a customer-centric firm, GMS offers no hold phone lines, same day email responses, and callbacks within one hour. In addition, the phone technology is set up in such a way as to provide salespeople with all databased information about the customer before they say “hello”. 
• “Needs Analysis” service – Possibly the best competitive edge in an industry fraught with agressive outbound sales teams and your run of the mill ego-centric, customer alienating, consultants.
• A considerable network of contacts – Mr. Dawson is well connected in the area of general consulting, and his Harvard degree opens doors via simple bragging rights, and an extensive alumni network.

5.2 Marketing Strategy

GMS’s marketing strategy revolves around a three-tiered focus. At the top of pyramid one, imagine a customer service ideal. This ideal is also included in the competitive comparison.

Pyramid three has at the top a team-centric company culture. Tactics revolve around building this culture from the ground up so that it rewards innovation and determination, and management shows no personal bias or favoritism except when a salesperson or consultant is outperforming the mean. Although this strategy appears to be an internal management goal or company summary object, it is highly relevant to marketing’s performance because without integrity standards and a consistent company culture, GMS’s marketing will feel disconnected and unsupported, and will suffer as a result. A more detailed breakdown of tactics and programs related to this strategy is available in the full marketing plan. 

5.3 Sales Strategy

GMS plans to develop and train 5-6 new salespeople by year two. Upon start up, the primary sales contact will be Mr. Dawson, but this will change as the revenues increase, and the company is able to invest in human capital.

GMS has a sales strategy that focuses on an initial needs analysis. Once the results of the needs analysis has been forwarded or described over the phone to a potential client, the salesperson will ask for a personal interview, a chance to sit down and discuss specifics. At no time should this be perceived by the potential client as “pushy” or “agressive.” 

The goal of this sales process is to get behind the numbers, and the business successes, to identify where the client’s needs lie. Once this is mapped out, GMS will decide how these problems can be best addressed, and will offer both a bid and some action points. If the client wants to use the action points to move forward on their own, this is very acceptable. GMS’s research has in fact shown that the clients that choose this path, often come back to seek additional information, and more often than not, accept the bid.

This strategy differs from the course often taken by large consulting firms in that the customer is not condescended to, or treated as if the knowledge isn’t right there in their own heads. Often, consulting companies will send a large ego to clean up a client’s mess, and find that the strategy backfires when the client only chooses to give the consultant the chance to bid. GMS’s sales strategy revolves around customer service and empowerment, not condescension and sales “closers.”

5.3.1 Sales Forecast

Sales forecast is based on the assumption that most of the revenue will be the result of consulting bids. The growth in retainer revenue is about 30% lower than the expected yearly growth in consulting bids of 80%/year. This may seem like an agressive number at first glance, but this is not a large company being discussed in this business plan. The smaller the company, often the larger the opportunity for exponential sales growth, and especially if the firm uses sound sales and marketing strategies to take share from the larger, less nimble consultancies.

The Needs Analysis service is listed only to highlight the fact that some outside information gathering firms/consultants will be used to compile the necessary information. This poses some risk because there are no costs associated with the Needs Analysis efforts. Nevertheless, GMS is confident that this product will set the company apart from the competition, and generate sales far in excess of the costs incurred.

5.4 Milestones

The milestones table includes one listing each for the business plan and the marketing plan. Each of these are crucial to the long-term and short-term success of GMS. The other milestones are also important, but most are simply tasks necessary in starting up almost any business. Nevertheless, the most important milestone in this table is financial. The SBA loan will determine whether this company will have the working capital to operate for 5-12 months with little or no immediate revenue. If GMS cannot find the working capital to meet the minimum cash flow expectations set forth in this document, the company will dissolve and the owner will turn his talents elsewhere. Therefore, it is possible that the line item for “SBA Loan” may be changed to acquire family or friends as investors. Ideally it will not come to that and Mr. Dawson will be able to retain full control of the company, and direct it entirely based on his vision.

Management Summary management summary will include information about who's on your team and why they're the right people for the job, as well as your future hiring plans.">

The management team will initially consist of Bill Dawson. A Harvard MBA, and world-renowned consultant for major Fortune 500 companies, Mr. Dawson has built a reputation based his customer-centric approach to consulting, a relative anomaly in the world of high profile consulting. Many consultants are trained to believe they are right and the client was put on this earth to learn from the consultant. That is not the case for GMS, as the management team (Dawson) takes a different tact. The consultant acts as an interviewer, learning all that is possible to learn about the client in a one or two week period. As a management tool, this approach is very effective because it gives the sales team flexibility in dealing with potential customers, and relieves the uncomfortable pressure to close the sale.

Mr. Dawson’s approach to managing customers is also the approach he will take in dealing with his salespeople. GMS doesn’t need a hefty management structure, or administrative overhead. Many of those processes may be handled through outsourcing and Internet technology. On the contrary, the management structure at GMS is designed to reward the performer and educate the underperformer. Each salesperson is given a battery of psychological and rational tests, and most importantly, are screened based on how well they will fit into the Dawson management style. This leaves little to chance, and encourages a team atmosphere that remains light-hearted and fun.

6.1 Personnel Plan

This table demonstrates how GMS plans to start acquiring clients. One salesperson will be trained initially, and that person will later head a team of salespeople as the company expands. The promise of growth, and chance to work for a strategically positioned consulting business is enough to have three major players bidding for the job. Although each will see a major cut in salary from their current position, the chance to share in company profits (10%) and growth is enough to draw them to a low base, high commission position that offers no guarantees.

Financial Plan investor-ready personnel plan .">

The Financial Plan is based on a pending SBA loan, and a corresponding cash flow amount held in a highly liquid account.

7.1 Important Assumptions

7.2 Break-even Analysis

The Break-even Analysis table is based on the assumption that each hour worked can be billed at approximately $70 per unit, and the employees will start at approximately $25/hour. This doesn’t include the cost of the payroll burden, however the assumptions are fairly accurate. Fixed costs are related to the lease and other monthly costs.

7.3 Projected Cash Flow

The following table and chart show the Projected Cash Flow figures for Growth Management and Strategies.

7.4 Projected Profit and Loss

The following table and charts are the Projected Profit and Loss and Gross Margin figures for Growth Management and Strategies.

7.5 Projected Balance Sheet

The following table is the Projected Balance Sheet for Growth Management and Strategies.

7.6 Business Ratios

Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 8742, Business Management Consultants, are shown for comparison.

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How to start a consulting business

Find out what you need to do to start and manage your own consulting business.

Being a consultant is a way you can make a career out of sharing your business expertise with others. It can also be a lucrative side hustle. This guide covers types of consultants, getting expert advice on writing a business plan, choosing your niche, and understanding your target audience.

What do consultants do?

Companies hire consultants for their specific expertise and to bring an outside perspective to problems.

A common misconception is that anyone can become a consultant. Someone who wants to be a consultant needs to be both great in their field and an excellent communicator. You need to be strategic, solution-focused, and want to help other businesses to succeed.

To help you decide if consultancy is right for you, check this list of the top skills that successful consultants need. Consultants need to be skilled in:

• providing specialized expert advice
• devising strategies for other businesses
• helping businesses diagnose problems and create solutions
• assisting with data collection, expert research, and giving feedback
• providing recommendations to help companies to grow and reach their goals

Types of consulting niches

Think about what consulting niche best matches your skills and experience. Some of the most popular ones are:

• Management consulting: This can involve helping companies with anything from operational decisions to team restructures. Management consultants help to solve organizational problems to improve business performance.
• Marketing consulting: This might be your niche if your expertise is in marketing strategy and understanding industry trends. It can involve creating a marketing plan to grow a new business or building brand awareness through social media.
• Human resources consulting: Sometimes an organization needs an independent consultant for support with employment contracts or managing disciplinary action. An HR consultant can bring fresh, unbiased perspectives and additional expertise.
• Financial consulting: Financial consultants are results-driven experts with the know-how to help businesses with their financial strategies, reporting structures, and data analysis.
• IT consulting: IT solutions operate at the center of many businesses, and work efficiently to support staff members. Depending on their background, an IT consultant can help with anything from reworking existing IT systems and networks to supporting the implementation of new software.
• Public relations consulting: Experts in communication and brand visibility may be well-suited to PR consulting. It's about finding the right tactics to improve a brand's presence, from creating compelling press releases to running buzzworthy social media events.
• Strategy consulting: This involves working with high-level managers and executives to create clear strategies that meet business objectives. It's similar to management consultancy, but focuses more on meeting specific goals, rather than improving overall business performance.
• Business consulting: A business consultant needs to have broad business and market knowledge to offer guidance and support. That support can involve writing a business plan to drive change and helping a company to implement that plan.

Consulting for smaller organizations vs. large companies

As well as choosing a niche, consider the size of the company you want to consult for.

Smaller organizations may require consulting work to be more hands-on as they lack the resources and expertise to strategize and implement improvements. They may need you to be more creative with budget, time, and resources when finding solutions in their specific area. You may require project management skills to help implement your recommendations.

Larger companies tend to be richer in resources and knowledge. Consulting for a larger business may require higher-level strategic thinking, as teams are available in-house to implement your recommendations. It's likely to involve more collaboration, working with different teams to get the job done.

Why start a consulting company?

So you're an expert in your field, looking to become a consultant to help other businesses. But why start your own consulting company? It allows you to work when and where you want, but running your own business can come with challenges.

It’s a big step moving from being in a full-time job to being self-employed as a consultant. So you might want to start consulting as a side project while still working full-time. This can be a useful way to learn the consulting landscape, understand if it's right for you, and start building your client base. However, it may not be sustainable long-term, as you balance your time and responsibilities throughout the working week. In addition, you must be sure that your side hustle client work doesn’t interfere with your day job, and that there are no conflicts of interest.

Here are some of the pros and cons of starting your own consulting practice:

• It’s fairly low cost to start
• It can be financially rewarding
• You have control of where and when you work
• You are your own boss
• Job satisfaction as the work can be rewarding
• You have flexibility
• Running your own business can be stressful
• Work can be irregular
• As you are self-employed, there are no employee benefits or safety net
• There are a lot of administrative responsibilities, such as handling taxes
• You can’t have clients that are competitors of your current employer

Step-by-step guide to starting a successful consulting business

Follow our simple step-by-step guide to starting your own consulting business and making it successful.

1. Develop a business plan

The first step is to create a business plan . This helps you clarify your ideas, guides you as you grow, and provides an important document for banks, investors, and accountants.

Your business plan doesn't have to be a lengthy document. Just one page will do. You can use this free business plan template. Here's a list of what you may want to include:

• Executive summary
• Company overview
• Industry analysis
• Customer analysis – likely potential customers
• Competitive analysis – who your competitors are
• Marketing plan – your value proposition and how you plan to market this
• Operations plan
• Management team / Your team
• Financial plan – how you intend to finance getting started and the ongoing business

If you're undecided about what type of consultancy service to offer, start by auditing your skills and experience. How can you make the most of your strengths? What’s the main area of expertise that you can offer to organizations?

As well as thinking about what you can offer, consider the target market you want to work in. What might be the pain points of working in this area? Is it an area you want to excel in? Answer these questions before moving forward.

2. Decide your business structure

You'll need to decide how to structure your business as it can impact the taxes you pay, and your business legal status.

These are some of the common business structures for a consulting business:

• Sole proprietor: Often preferred by single owners for its simplicity in ownership and management. You may work under your own name or file for a DBA (doing business as) if you want to name your company something else. The income taxes for a sole proprietor are generally simple too.
• S-Corp: An S corporation is a corporate entity and any shareholders who work in the business are employees. While this type of entity files its own tax return, income is reported and taxed on the shareholders’ personal tax returns.
• Limited liability company (LLC): An LLC is a flexible legal structure that provides some asset protection for its owners. There are multiple taxation options: it can be taxed as any of the entity types listed above, or as a partnership, depending on the number of owners and any tax elections made.

Read more in this Xero guide to types of business structure .

3. Get an EIN

The next step is registering for an employer identification number (EIN) at the IRS. It can be helpful when opening a bank account and filing for taxes. Sole proprietorships have the option of using their social security number instead.

4. Apply for a business license

If you've decided to set your business up as an LLC or an S-Corp, you'll need to register in the state you choose to operate, and in additional states if you will be working in more than one state. Find out how to register with your state. You may also need to register a doing-business-as (DBA) name if using a brand or trade name.

As permits and licenses vary from state to state, it's best to visit the individual websites to follow the steps you need to take. Find out more about what may be required when registering a business .

Special considerations/certifications may be needed, depending on the state you're operating in:

• You may require a general business license in some states.
• Some cities require a zoning permit.
• Some consultancy work requires proof of certification or qualification, such as for financial services.

It's best to check with local authorities for what permits, licenses, and certifications are required.

5. Define your target market

Once you've chosen your consulting niche, you need to find your target market . The type of clients you work with depends on your area of expertise. Consider who the potential clients are likely to be and what kinds of businesses they come from.

For example, your market may be:

• Small businesses
• Corporations
• Local, state, or federal government
• B2B businesses
• A specific business sector such finance, education, or health

6. Set your prices

How will you set up your pricing structure for prospective clients? You could, for example, charge via hourly rate or project rate. Read about some simple pricing options to work out what might be right for you and your business. It's important to understand the value of what you're offering and how your business can make the most money.

When setting your pricing structure, you'll need to consider the following:

• Your overhead costs, such as office space
• Competitor rates
• The industry you’re working in
• Any travel that’s involved

7. Establish a business bank account

It's a good idea to set up a business bank account for your company. It helps to separate your business spending from your personal expenditures.

It can also be useful if you need to apply for business loans or credit cards for company spending, especially if you want to scale your business. Plus, you can track the income from your company more easily if it's all in one place. If your bank connects to online accounting software like Xero, you can get automatic feeds of bank transactions into your accounts.

8. Build your brand

You'll need to define and build your brand to attract prospective clients to your business.

Start by focusing on your niche and target market, as this helps to tailor your brand to the right clients. You'll need to choose a business name and a logo to go with it.

The next step is to build a website to explain what you do, and showcase your offering. This is where you'll refer new clients for more information about your business, and where companies will contact you for potential work.

If you want to become a thought leader in your industry and set yourself apart from other consultants, think about what else you can do to help build your reputation. You could publish blog articles that share your knowledge and expert opinions. You could speak at events and conferences.

9. Understand business insurance requirements

Having business insurance is essential for the smooth and safe running of your company. Once you understand what you need for your business, make sure you regularly review your insurances, as risks and responsibilities change and evolve.

Start by understanding the different options that are available to you. Some key types of insurance include:

• General liability insurance: This provides support against public injury and damage claims.
• Professional liability insurance: This provides economic support if any mistakes are made that put your business at risk.
• Business continuation insurance: This can help replace lost income if your business has to close or slow for any reason.
• Worker’s compensation insurance: This is required if you have employees, providing financial support in cases of injury or death.

10. Startup financing

The next step is thinking about how to fund your new business venture. The types of funding available for starting a small business include:

• personal savings
• business loan, for example, through SBA
• borrowing from family and friends
• credit card financing
• crowdfunding
• a business partnership or strategic alliance

Some businesses may not require a large amount of funding upfront, but choosing the right funding is important for the longevity of your business. If you need a business loan, read this handy guide to understand what kind you need and how to apply .

11. Market your small business

Once you've set up your business, chosen a company name, and created a website, you need to think about marketing your brand. How will your first clients discover your consulting services? Can anyone provide you with testimonials or a referral to help build trust in your business? You need to communicate your business in the right way to the right clients.

Common ways to market a brand include:

• Word of mouth and testimonials from previous clients
• Social media
• Create a LinkedIn profile for your business
• Establish a Google business profile
• Ensure that your website is optimized for search engines (SEO)
• Advertise in industry publications
• Create business cards to hand out at networking events
• Get a proposal template designed that looks professional

Xero does not provide accounting, tax, business or legal advice. This guide has been provided for information purposes only. You should consult your own professional advisors for advice directly relating to your business or before taking action in relation to any of the content provided.

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How to Write a Business Plan for a Consulting Business

There are four key areas that you should focus on when developing a business plan for your consulting business..

If you've found yourself holding a pink slip from your corporate employer or perhaps are just tired of the old 9 to 5 grind, one of the best ways to get back on your feet might be turning your experience and skills into a consulting gig since just about anyone who possesses specialized skills can hang out a shingle of their own. But before you do, you might want to consider taking the time to create a business plan for your new venture, which will not only help you map out the opportunities before you, but also the threats. While business plans doesn't appeal to everyone, especially if you don't ever expect to raise capital for your business, it can be a critical factor in getting your business off the ground, says Jennifer Leake, a certified management consultant and founder of Consultants Gold , an online community dedicated to helping consultants run their ventures successfully. That's why, as you get started, Leake offers the following tips for developing a plan:

• Write it! "Putting it on paper requires far more thought than just having it in your head," says Leake.
• Keep it simple so that you revisit it often—so don't make it too long or too complex, she warns.
• Spend the lion's share of your time defining your niche and why you are uniquely situated to serve it. "If you can't succinctly articulate what your business is selling, you'll never get people to buy," says Leake. 
• Don't create your plan in a vacuum. "You'll develop a better business plan if you have feedback, and you'll be more likely to take action if you have accountability from mentors, coaches, or success partners," she says.

But crafting a business plan for your new consulting company doesn't mean you should stick to the average template you can find online, as you should spend your time focusing on the elements that most often make or break companies in your industry. "Writing a business plan for a consulting firm sounds fairly straightforward because there are so many who call themselves 'consultants,' but it can be quite difficult for many reasons," says Michael Hermens, president of Finance Forward , a financial advisory firm in Dallas. That's why Hermens says that you should focus on four key areas when fleshing out your business plan: 1. Value Proposition Answer this question: What is your specific value proposition? "Thousands of ex-IT programmers are now 'Social Media Consultants,' " says Hermens. "What do you do that thousands of other people don't?" The keys to building a solid value proposition are to give decision makers solace that they made the right decision, he says, which can be done in three ways: 1. Offer a service guarantee, 2. Build and take prospects through a well-defined methodology, or 3. Specialize so narrowly that it is easier to increase your stature. "The challenge with a guarantee is that larger firms don't normally purchase on that basis and smaller firms generally take a service guarantee as a tacit admittance of being mistake prone," says Hermens. "A well defined methodology or approach takes a while to build, but is well worth it for prospects who do not know you. Narrow focus helps potential consultants gain exposure, increased stature helps clients be satisfied with their hiring decision."

Dig Deeper : Nobody Buys a Value Proposition 2. Target Market Answer this question: What is the best target market for you, or do you hunt every potential client that might possibly need your services? "Understanding your target market is the most difficult planning activity," says Hermens. But developing an understanding of the competitive landscape is crucial, particularly go-to-market and pricing strategies, as well as the specific problems that the industry or market segment is trying to solve. "Gaining insight into how companies in your industry go to market, the basis on which consulting firms compete, matters," he says. "In strategy consulting, it might be references of former clients or the published knowledge share that gets clients interested. In large IT deployments, it is probably the strength of the methodology. With forensic consulting, your name and personal credibility is a huge selling point." In other words, determining how you should go to market, how (or how much) you charge your clients, and your familiarity with specific industry jargon and problems the industry is trying to solve, are crucial in planning your consulting business, according to Hermens. One approach offered by Beth Corson, founder of Your FundingKey Advisors , is to choose a few industries and then outline the size and type of businesses that you'd like to work within those industries. "Rather than the desperate approach of taking any client that comes along, be selective and create a clear road map of where you want to go," she says. "Several years from now, your client roster should be fairly close to the plan that you make now. By working with similar clients in a specific industry, your company creates a level of expertise that makes it easier to perform well and get new clients because you understand their unique challenges and how to overcome them."

Dig Deeper : How to Define Your Target Market 3. Marketing Answer these questions: How do you market your consulting business? What tactics do you employ to get in front of decision makers to evaluate your offering? There's no question that in order to get your new consulting venture off the ground, you'll need to market your skills and experience to potential clients. That can be difficult, though, when you're a sole proprietor, since time spent marketing is time you're not billing for. While you can always hire an outside firm to help, your fledgling business might find the cost prohibitive. The answer, then, is to be creative in finding ways to promote your offering. One way to do that could be through landing public speaking engagements, which can be very effective at promoting your knowledge and point of view on your industry's challenges, says Hermens. Another option can be to partner with other companies that might offer complementary services to your own, a tact that may also help you build experience in new areas. But, at some point, you must develop your own client relationships independently if you want to keep your company growing.

Dig Deeper : How to Promote Your Consulting Business 4. Employees Answer these questions: If you have employees, what is the best way to deploy them, given the reality of project work? Do you plan to pay them hourly, by confirmed project, or salaried? "The issue here is how do you leverage yourself to grow revenue?" says Hermens. "Consultants who develop their brand can write books and charge an hourly rate, but they still cannot serve two clients simultaneously. Leverage allows your consultancy to flourish as your company takes on more projects." The key, then, is to think about how you align revenue arrangements with employee compensation and how to pay employees to ensure they are available when you need them by asking yourself questions like: Do you pay a salary and risk a lull in projects? Or, perhaps you pay employees on a project basis, only when they work, risking their availability when you get a new contract? "The goal here is to align revenue with employees compensation in the beginning as your consultancy grows," says Hermens. "Once your business becomes large enough, put key people on a salary, with performance bonuses. They will stick with you, have learned your go-to-market strategy, and know your methodology inside and out."

Dig Deeper : The New Rules of Employee Compensation

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How to Start a Consulting Business: Your One Page Business Plan Learn the three critical components of your business plan and download a template to get started

By Terry Rice Edited by Dan Bova Apr 28, 2021

I wrote several business plans while obtaining my MBA from the University at Buffalo. But, for some reason, I totally skipped that part when it was time to launch my consulting business. My only real plan was to generate revenue, which often involved saying "yes!" to any opportunity that came my way, and not charging nearly enough for the services. And, when my daughter was born, I was too concerned about the future to be fully present. I was there, but I was more preoccupied with worrying about how I would provide for her than I was with enjoying and appreciating the experience.

Fortunately, that all changed once I decided to create a real plan aligned with the vision I had for my business and my family. That was six years ago and I've now packaged it as the One Page Business Plan for Consultants . I'm sharing the framework with you so you can avoid my mistakes, and compress the amount of time it takes for you to find fulfillment. This is by no means a hack - you're going to put in work - but this guide will reduce the confusion and frustration that can come from starting a new business.

I should also note that you may not complete it in one sitting. By design, it will challenge you and expose blind spots you may not be aware of. That's a good thing! Addressing these critical issues now will save you from months - possibly even years - of self-doubt and lost revenue.

And, if you're currently offering professional services , but are wondering why you haven't been able to "figure it out" just yet, this plan could be the key to unlocking your revenue potential.

It's all centered around answering three critical questions, which I've highlighted below.

Related: Learn how to package, price, and promote your consulting services

What do you do, who do you do it for, and why?

Clarity is the precursor to confidence. Once you establish clarity on your services, audience and motivation; you'll be able to confidently move forward with the next steps. I address how to get clear on your services in the article How to Start a Consulting Business: 3 Steps to Finding Your Idea , so I suggest checking that out in addition to the guidance provided in the business plan.

Be sure not to skip defining your "WHY" - the purpose, the cause, or the belief that drives you - this will become a valuable differentiator as you grow your business. And, if you need help crafting yours, Simon Sinek literally wrote the book on it, but you can also check out his brief YouTube video that provides some valuable tips.

How do you attract clients and opportunities by expressing your expertise and personality? (Marketing)

When I first started offering Digital Marketing services, I visited a local business in Brooklyn so I could pitch them in person. I knew launching a business would require stepping out of my comfort zone and I saw this as the perfect opportunity to do so. Incredibly enough, they said "yes", but I never did door-to-door sales again. Why? Because I hated it, and I knew there had to be a more efficient way.

Your goal should be to land clients based on how you feel comfortable presenting yourself and the value you provide. Not by spending 20 minutes hyping yourself up by listening to Eminem's "Lose Yourself" on repeat before you finally get enough courage to ask for their business. Everyone may be telling you to join Clubhouse , but answering questions on Quora might be a better fit for your personality.

It's also crucial to attract the right prospects. I used to get contacted by people who asked how much I charged before asking how I could help. In time, you'll learn how to weed those people out so you can focus on prospects who understand the value you provide and are willing to pay you what you're worth.

Beyond that, your marketing tactics need to be measurable and repeatable. Otherwise, you won't know how to avoid making the same mistakes or double down on what's working for you.

Related: How to Grow Your Email List and Sales Pipeline by Creating Your Own Free Mini-Course

How do you deliver your services and scale revenue? (Delivery)

Experiencing burnout — emotional, physical, and mental exhaustion caused by excessive and prolonged stress — is far too common with entrepreneurs. One way to avoid it: develop a process to deliver your services that is aligned with efficiency and impact.

While custom projects can be lucrative, they also require much more coordination and development. Defining the delivery - and pricing - of your services in advance allows you to create a business model that is aligned with your desired revenue and lifestyle goals.

You can see options for delivering your services below.

By documenting this process, you'll also be able to better project and scale revenue, which reduces uncertainty and gives you the freedom to take time off without worrying about where your next paycheck is coming from.

Related: How to Start a Consulting Business: Determining Your Rates

Download the One Page Business Plan and block off three hours to work on it. I suggest working for 50 minutes, taking a 10-minute break, and repeating that cycle three times. And, if you have any questions feel free to reach to me on LinkedIn or join a live Q&A session .

Ready to start your consulting business? Check out our Consulting Business Accelerator and get going today! You'll gain access to training videos, hands-on activities and join live weekly Q&A calls.

Entrepreneur Staff

Business Development Expert-in-Residence

Terry Rice is the Business Development Expert-in-Residence at Entrepreneur and Managing Director of Growth & Partnerships at Good People Digital ; an agency that provides marketing and monetization solutions for entrepreneurs. He writes a newsletter about how to build your business and personal resilience and personal brand in just 5 minutes per week and created a revenue optimization checklist to help you multiply your income potential. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

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How to Start a Consulting Business (12 Steps)

Bryce Warnes

Reviewed by

April 8, 2021

This article is Tax Professional approved

Whether you’re launching a side hustle or setting out on a new career path, starting a consulting business is a smart choice. Low startup costs and overhead make it relatively easy to get going. And if you already have a network in your industry, you can leverage it to land your first clients.

Ready to jump in? Here are 12 straightforward steps you can follow to start a consulting business.

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1. Write down everything you have to offer clients

When you start a consulting business, you are the product you’re marketing. It’s your expertise that clients will pay for. Upfront, you need to determine what you have to offer. That will shape how you plan and market your business.

Look at everything of value you can provide clients now, and plan how to increase that value in the future. Break your audit down into three categories:

1. Skills and certifications

What concrete skills and certifications do you have specific to your target niche? And what broader business skills can you use to support your clients?

For instance, Annie wants to become a consultant for studio potters. Her concrete skills include all the practical aspects of making pottery (throwing on the wheel, trimming, glazing, and firing), best practices for maintaining and running a small- to medium-sized pottery studio, and teaching classes. She also knows the ins and outs of selling pottery at craft fairs, in stores, and online.

As far as other skills, Annie has an MFA Ceramics degree, and a Diploma in Business Administration. So not only does she have a broad and expert knowledge of the world of pottery, but she’s also formally educated in the business world.

2. Experience

Experience is a major selling point for many consultants. If you were to hire a consultant, would you choose the professional with 10 years experience in your industry, or 30 years?

It’s more than time, though—experience includes where you’ve been and what you’ve done. This can affect which clients you market to. For instance, running your own small business, versus managing a department within a major corporation, will determine whether you’re more likely to work with up-and-coming entrepreneurs or large offices restructuring their staff.

Annie potter’s experience audit might include:

• Has run her own pottery studio for 25 years
• Has managed volunteers, apprentices, and part-time employees during her time in business
• Scaled up from a home-based business with one wheel and one small 120 volt electric kiln to a large workshop with twelve wheels and two large 240 volt electric kilns
• Established and run her own ecommerce store

Note that Annie focuses on business experience, not just her experience as a potter. This should be your priority—not just showing how good you are at what you do, that you know how to make it profitable. After all, that’s what your clients are aiming for as well.

3. Room to grow

The final part of your experience audit includes a section on where you can develop both within your field and as a consultant. You won’t use this section to appeal to clients—it’s for your own planning. By constantly upgrading your skill set, you expand what you have to offer clients, and potentially open up new sections of the market.

For instance, Annie specializes in earthenware and stoneware, both common types of pottery. But during several artists’ residencies, she’s been able to experiment with porcelain—which uses a special, stiff type of white clay, and fires at much higher temperatures. She decides to continue building on her skills with porcelain, and incorporate it into her own practice. That way she’ll be better able to consult studios working in that medium.

Also, she knows that social media has changed the way potters market and sell their products. Annie decides she’ll set aside funds and time next year to get an Online Marketing Diploma, making her better able to consult businesses that do most of their selling online.

Planning ahead like this may seem unnecessary when your consultation business still hasn’t gotten off the ground. But developing your skills is an investment in your business, and has a concrete financial impact. Making plans now can help you better project the future of your business.

2. Research your consulting business

Before you launch your business, you need to get the lay of the land. That means researching competitors and clients.

Research consulting business competitors

Once you’ve determined who you’ll be consulting—in Annie’s case, it’s studio potters—research consultants that cater to the same crowd.

First, create a list of your competitors. Then look for:

• Online reviews by customers. What do your competitors do well? What are their weaknesses?
• Website and social media profiles. How do your competitors present themselves online? Do they seem to have a social media marketing strategy in place? How are they engaging with followers?
• Public records. If you’re going up against a corporation—like a large consulting firm—their financial filings are public. They’re free to read at the US Securities & Exchange Commission website .

And don’t be afraid to do some primary research. Get in touch with them as a potential client, so you can learn how they court new business. Or better yet, contact some of their previous customers, and hear what they have to say. And subscribe to their newsletter, follow their blog, add them on social media—a little light stalking could give you the clues you need to get the upper hand.

Research potential clients

To find out what potential clients are looking for, you need to know what they’re already saying. A few ways to do that:

Crack open the Rolodex

If you’re already established in your industry, you likely have contacts you can reach out to for advice. Annie might reach out to her friend Kevin, who runs his pottery studio, and interview him. What would he look for in a consultant? What parts of his business does he most need consultation on?

You may also want to see if any of your business contacts have experience hiring a consultant before. They could be able to tell you what worked and what didn’t, what their experience was like, and what they would change if they could do it again.

Interview consultants in adjacent fields.

Try contacting some other consultants—not competitors, but people in adjacent fields.

For instance, Annie has a number of contacts who run textile studios. Like her, they take commissions from clients, as well as creating and selling their own stock, and teaching classes in-house. And some of them have acted as mentors to other textile artists.

Annie can contact these business owners and talk to them about their experiences acting as mentors, and how they were able to translate their own business experience into actionable advice for their clients. That can help her plan her own services.

Dive into online communities

Online communities can tell you what potential clients are talking about. Who knows? You might already be a member.

Annie belongs to a group called Pottery Entrepreneurs. She doesn’t use Facebook that often, but for the sake of researching her business, decides to take a deep dive into a year’s worth of conversation topics.

Turns out, a lot of studio potters find it difficult balancing their teaching schedules with the time they need to produce their own pottery for their clients and stores. Annie resolves to make that one of her value propositions—helping her clients find a way to manage both revenue streams for their studios.

Visit local meetups for your customer base

Time to do some field work. Attending meetups in person can be a great way to find out what troubles face potential clients, and find ways to appeal to them.

Meetings of a local business association, networking events, workshops, business seminars—these are all great potential venues. For something more casual, and easy to access for free, try Meetups.com . You may be able to find a meetup where local business owners in a certain industry—restaurants, for instance—get together to socialize and gripe about business.

Not only will you learn more about potential clients, you may be able to establish relationships with a few, and sign them up for your services later on.

3. Decide how much you’ll charge clients

The best way to decide how much you’ll charge is to approach other consultants for quotes. Once you’ve collected quotes from as many consultants as possible, you’ll have an idea of what clients are willing to pay based on consultants’ experience and reputation.

Your business is new, so you won’t be able to charge top-of-the-line prices. But shoot for somewhere in the middle, or slightly less than average. You can always increase your rates once you’ve built out a list of clients.

Translating your services to value

To show a potential client how your consulting services can have a tangible impact on their business, tell your own story. Put together a short, easily digestible document that tells potential clients how you were able to grow your own business and increase your income. That includes an approximate financial history, and the steps you took to scale your business up—such as reorganizing operations, hiring staff, or opening new revenue streams.

4. Figure out how you’ll bill clients

There are three ways you can choose to bill each client that comes your way: Hourly, per project, or on a retainer basis. Certain methods may work better for some clients than others. Figure out your preferred method—as well as how flexible you are when it comes to using other methods—right away, so you’re ready to onboard new clients from the get-go.

A not about retainerships: Many clauses in retainer contracts will prevent you from working for your client’s competitors at the same time—potentially limiting your overall income.

5. Write a business plan

A business plan is like a road map for your business. It tells you where you are now, plus where you’re going in the future. And, as time goes on, you can refer back to it to make decisions.

On top of helping you make smart decisions, your business plan is important in case you apply for a small business loan or line of credit in the future. Even if that’s a far-off goal, it’s wise to have your business plan prepared now, and ready to go when you need it.

Your business plan will include:

• A cover page
• The value you offer clients
• How your consulting business makes money
• The resources you rely on to operate
• Ways you’ll expand your services in the future
• Your position in the market versus competitors
• How you plan for your business to grow
• Current financial report
• Financial projections

Our article on how to write your first business plan gives you a thorough walkthrough, so you can create one for your business.

6. Choose a business structure

Your business structure affects how you’ll report and pay taxes. It also determines your liability—whether your personal assets are on the line in case your consulting business can’t pay its debt or gets sued.

To choose the right structure for your consulting business, check out our guide to business entity types .

7. Name your consulting business

Whether you need to register a name for your consulting business depends on its structure, as well as whether you’ll be operating under a name other than your own. Our main article on how to start a business has the full step-by-step.

8. Open a business bank account

Even if you’re a freelance sole proprietorship, you should open a business bank account. In fact, even if you’re running your consulting business as a casual side hustle, you can benefit from a business bank account.

A separate account allows you to draw a clear line between your personal and business assets. That makes bookkeeping and small business tax filing much easier—you won’t have to work as hard to take advantage of tax deductions, for example, because all of your professional expenses will be taken from your business account.

Looking to save on fees, earn credit card rewards, or get an SBA loan ? Check out our guide to the best banks for small businesses .

9. Obtain licenses or permits

Depending on your state, you may or may not need licensing to open your consulting business. Our how to start a business guide covers the main types of small business licenses.

10. Invest in must-have consulting tools

To keep your consulting business running smoothly from day one, invest in the best tools for the job now. Those include::

• Proposal writing software. Once your business kicks off, you’ll be writing a lot of proposals for clients. Proposal writing software lets you automate some of the process and track which proposals you’ve submitted where. One of the most popular choices for consultants is Practice Ignition .
• Project management software. Whether you bill hourly or per project, it’s essential to keep track of how much time you invest in each client’s needs. And the more clients you get, the harder it becomes to track every project you have underway. Project management software helps. Mavenlink is a popular choice, and designed for collaboration in case you hire employees.
• CRM. Tracking leads and clients lets you stay on top of the work you’re doing, as well as the clients you’re trying to bring on board. Hubspot CRM is an affordable option.
• Bookkeeping. Up to date books let you plan your business and take advantage of tax deductions at the end of the year. Bench gives you a dedicated remote bookkeeping team and intuitive software—so you can spend less time managing finances, and more time helping your clients.
• Invoicing. The invoicing cycle can quickly become an invoicing dead end if you don’t have an organized billing system in place. Freshbooks is head and shoulders above the competition, and makes the process simple.

12. Insure your consulting business

As a consultant, you won’t exactly spend your days jumping over school buses on a motorcycle. So why worry about insurance?

Business insurance can protect you in the event of a lawsuit from a disgruntled client. It can save you from being sued by employees if you miscalculate wages. And it can even protect your home office in case of extreme weather events.

To help choose exactly which coverage is right for you, check out our guide to small business insurance .

This guide gives you the essentials you need to start your consulting business. But there are other topics—like figuring out a federal tax ID—that also impact your business.

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How to Start a Business Consulting Business

Below you will learn the key steps to starting a business consulting firm.

Download the Ultimate Consulting Business Plan Template

11 Steps to Starting Your Own Business Consulting Firm

1. conduct market research to determine demand.

An important step to starting a business consulting business is conducting market research. To begin, you must learn what services your clients want and how much they are willing to pay for them. There are two ways you can go about conducting this research:

• Survey Your Target Market : This can be done through online surveys, focus groups, or interviews.
• Review Consulting Industry Trends : Keep tabs on what’s happening in the consulting industry, both locally and globally.

Once you have analyzed the survey data, determine which types of businesses are likely to hire you and how much they are willing to pay. Use this information to set your consulting prices.

Read our article on other methods of conducting market research for your consulting business.

2. Name Your Business Consulting Business

Once you have analyzed your market and determined what services clients want, it’s time to name your business consulting firm. While naming a business can be difficult, there are a few rules of thumb to keep in mind:

• Keep it Short : Your business name needs to be short enough for clients to remember and say.  
• Keep it Relevant : Your business name should be relevant to the business services you offer and your market’s needs.
• Keep it Memorable : Using clever ideas and words, help your audience connect with your business.
• Focus on Your Target Audience :  Make sure that whoever sees or hears your company name understands who you are targeting as future clients.

Read our article about choosing the right business name .

3. Determine Your Consulting Business Model

There are four main types of business models for business consulting firms:

• Consulting Firm Model : This is the most common type of business model and it involves hiring other consultants and employees to provide services to clients.
• Independent Consultant Model : This is when a consultant offers their services to clients on their own.
• Productized Model : This is when a consultant offers a fixed set of products to their clients.
• Hybrid Consulting Model : This type of consulting firm offers a selection of business consulting services and products. 

No matter which model you choose, make sure that it aligns with your business goals and the services you offer.

Read more about choosing the right business model for your consulting business.

4. Choose Your Business Structure and Set-Up Your Company’s Legal Entity

As with any business, the type of legal entity you set up is critical.  After all, you want your company to be treated as a separate entity, not just an extension of yourself.  There are several types of structures in which you can start your business consulting company. Three popular options are sole proprietorship, S-corporation and LLC (limited liability company).

• Sole Proprietorship :  A sole proprietorship is one in which the business and the owner are considered to be one entity. Therefore, you are personally responsible for all debts and liabilities your business consulting firm may incur. One benefit of this type of structure is that it’s easy to set up and there are no formal filings required.
• S-Corporation : An S corporation is a type of C Corporation that was designed by the IRS to help small corporations minimize their paperwork while still gaining many of the tax benefits of incorporating. It also offers protection for business owners in case of lawsuits and other liabilities.
• Limited Liability Company (LLC) :  An LLC is a structure in which the company is considered a separate legal entity from its owners. This means that the company is responsible for its own debts and liabilities. This type of structure offers protection for business owners in case of lawsuits.

Read our article comparing the most common consulting business structures .

5. Write Your Own Consulting Business Plan

A business plan is a document that outlines your business goals, strategies, and how you plan to achieve them. For a business consulting company, your business plan should include the following:

• Business Description : Describe what your company does, who your target market is, and how you will differentiate yourself from the competition.
• Industry & Market Analysis : Detail your research on the industry and what services clients are most likely to want.
• Financial Plan : Outline your estimated income and expenses for the next three to five years.

Other sections of your plan will answer other key questions such as the following:

• What are your areas of expertise?
• What services can you offer your clients?
• Who is your target audience?
• How will you differentiate yourself from the competition?

Your business plan should also include several sections that detail your company’s history, current financial situation, and future goals. These sections will allow an investor to learn more about your company before they commit to investing in it. A business plan generator can help you easily create your plan.

Read our article about how to write a consulting business plan .

6. Apply for the Necessary Permits and Licenses

You must register your business consulting business as a legal entity with the state in which you plan to do business.

To file your business with the state, obtain the necessary forms from the Secretary of State’s website or local County Clerk’s office. You will be required to pay a small fee for filing your business with the state.

Registering with the federal government may or may not be required. You can register your business on the federal level by obtaining an Employer Identification Number (EIN) from the IRS.

Read our article about obtaining the proper consulting business licenses .

7. Determine Your Budget & Apply for Funding as Needed

As with any business, you will need to use your own capital to finance the initial stages of your business consulting company.  Your budget may also include several other costs including marketing expenses and the salary you wish to pay yourself.  

After determining how much money you will invest in starting your business, review some options for financing your business.  Here are several financing options that may be available to you:

• SBA Loans : The Small Business Administration (SBA) is a government agency that provides financial assistance to small businesses in the U.S.  
• Bank Loans : Many small business owners are able to secure loans from their local banks. Often, you can borrow money for any purpose that relates to the growth of your company.
• Friends and Family : You can consider getting loans and/or equity investments from friends and family members..
• Angel investors : Angel investors may provide debt or equity funding to you.

Read our article about the costs associated with starting a consulting business to help you determine if funding is needed.

8. Get the Technology & Software Needed to Run Your Business Consulting Company Efficiently

As a business consulting firm, you will need different types of technology to complete client projects and keep track of your business operations. To simplify the process of starting a consulting business, we’ve provided a list below detailing some items that you’ll need:

Computers : Even if most of your work is done remotely with clients on the other side of the country or world, you will need at least one computer that is dedicated to your business consulting company.

Software : Software is an essential component of any consulting business. The right software can help you manage projects, track expenses, and communicate with clients more effectively.

Here are some popular software platforms that may be beneficial to your business:

• Microsoft Office : This software suite includes a variety of applications that can help you manage your company, including Word, Excel, and PowerPoint.
• QuickBooks : This software is designed for small businesses and can help you track income and expenses, create invoices, and manage payroll.
• Basecamp : This project management software can help you manage multiple projects simultaneously and keep track of deadlines and milestones.
• Gmail : Google’s email platform offers a number of features that can be helpful for businesses, including the ability to access the same email from multiple devices.
• CRM : Customer relationship management software can help you track customer communication, manage leads, and create reports that detail your sales activities.

Read our article about the technology and software you need to run a consulting business .

9.  Market Your Business Consulting Firm to Potential Clients

Once you’ve established your business consulting company, the next step is to market it to potential clients. Here are some common marketing strategies used for business consulting firms:

• Cold calling : Calling businesses and asking if they are in need of a business consultant is a common way to market your business.
• Networking : Meeting people in person and building relationships is an excellent way to find potential clients.
• Referrals : Asking current clients to refer you to other businesses is an effective way to get more leads.
• Online marketing : Marketing your business online, such as through a business website and pay-per-click and/or social media marketing, can help you reach a larger audience looking for your services.

You should also consider ways to incentivize potential clients to choose you over another business consulting firm. Some incentives that work well include:

• Lower rates : Many consulting businesses offer lower rates on their services to attract new clients.
• Discounts on services : Offering discounts on certain projects may help you win bids against other consulting businesses.
• Free consultation : Providing potential clients with a free consultation can help them determine if your company is the best one for their needs.

Read our article about  how to market your consulting business for more tips.

10.  Establish a Price Structure and Billing System

There are a few factors to consider when establishing your price structure:

• Hourly rates : Charging by the hour is a common way to price consulting services. This allows clients to budget for your services and gives you the flexibility to charge more for complex projects.
• Project rates : Charging a flat fee for a project can be beneficial for both the client and the business consultant. It ensures that the client knows what they are paying up front, and it allows the consultant to charge more for more complex projects.
• Retainers : A retainer is a set amount of money that the client pays upfront for services. This can be a good option for clients who need ongoing consulting services.

No matter which pricing structure you choose, be sure to clearly communicate it to your clients. Additionally, have a detailed invoice template that includes all the services you provided so the client knows exactly what they are paying for.

11.  Manage Client Relationships and Deliver Projects

After finding new clients and marketing your business consulting business, you should begin delivering the projects and getting paid. This means managing client relationships and making sure that clients are happy with your work. Some of the ways to manage relationships include:

• Regular communication : Keeping in touch with clients on a regular basis via phone, email, and in-person can help improve your relationship with them.
• Feedback : Asking clients for feedback after each project is completed can help you understand what they liked and didn’t like about your services.
• Regular reviews : Meeting with clients on a regular basis to review the progress of the project and update them on your findings is a good way to keep them in the loop.

Delivering projects on time and within budget is essential for a business consulting business. It can be beneficial to create a project management plan that outlines how each project will be completed. This will help ensure that all deadlines are met and that the client is happy with the final product.

Read our article to learn more about what it takes to manage client relationships .

Starting a Business Consulting Business FAQs

Why start a consulting business.

There are many reasons why starting a business consulting firm can be a lucrative and rewarding venture. Perhaps the most appealing aspect of this type of business is that it is relatively easy to get started. You don’t need a lot of capital to launch your business, and you can typically start offering services within a few weeks. Additionally, there is a growing demand for business consulting services, so there is a lot of potential for growth.

What is Needed to Start a Consulting Business?

There are a few key things you will need to start a business consulting company:

• A solid business plan : This is essential for any type of business, and it is especially important when starting a consulting firm. Your plan should outline your goals, strategies, and how you plan to achieve success.
• A strong marketing strategy : In order to attract new clients, you will need to have a solid marketing strategy in place. This should include a mix of online and offline marketing techniques.
• A good website : A professional-looking website is essential for any business consulting firm. It should be easy to navigate and showcase your consulting services and qualifications.
• A great team : To be a more successful consultant, you will want a team of talented and experienced professionals. This includes business consultants, project managers, and support staff.
• A good billing system : You will need to have a system in place for invoicing clients and tracking payments.

What are Some Tips for Starting a Business Consulting Company?

The following tips can help you to start a consulting business:

• Start small : Don’t try to take on too many projects or clients right away. Start out small and gradually increase your workload as you grow your business.
• Create a niche : When starting a business, it can be helpful to specialize in a specific area. This will help you to attract new clients and stand out from the competition.
• Network : Meeting other business professionals and networking can help you to build relationships and find new clients.
• Stay up to date with trends : Keeping current on business trends is essential if you want to offer the most relevant services to your clients.
• Offer value : In order to be successful, you need to provide value to your clients. This means offering them high-quality consulting services and delivering projects on time and within budget.

How to Start a $420K/Year Consulting Business

Are you really good at a specific portion of your industry? Do you want to help other businesses achieve phenomenal results? Then you need to learn how to start a consulting business.

Ryan Gromfin was a chef at a 5-star restaurant when the constant stress got to be a bit challenging. He’d recently had a heart attack and his partnership imploded, but a colleague asked him to consult with their restaurant.

That’s how Restaurant Boss came to be. We’re going to show you how to start a consulting business with advice on how Ryan went from Googling “What does a consultant do?” to making $420K per year.  You’ll be able to do it too.

What Is a Consulting Business?

You might not be wondering, “What is consulting?” but Ryan had to Google, “What does a consultant do?” when he was offered his first consulting gig. He told us:

I was a chef. I’d always been a student of Tony Robbins and other consultants, but never had an idea of how I’d do it. When a partnership failed, I got an offer from a colleague to consult, and I said sure. From there, I prepped for the first meeting, did well, and they asked for a bid.

So, I figured I’d include it for those of you in a similar position.

A consulting business gives expert advice to other businesses. Ryan provides consulting services to restaurants, but there are 203 different reports that include the term consulting in the IBIS database pictured below. The majority fall under NAICS code 54: Professional, Scientific, and Technical Services in the US.

That means there are at least 10 different types of consultants for each industry segment in the NAICS. If you are an expert in something, chances are you can start a consulting business.

Defining Consulting Business Ideas

People often start a consulting business because an opportunity arises. After you successfully complete the first consulting project, take the time to develop a more structured consulting business. During the process, you’ll want to consider:

• Types of consultants
• Different business models
• Industry outlook
• Major players

Good news! We’re going to share some insights with you about consulting businesses, starting with the different types of consultants.

Types of Consulting Businesses

Fortunately, consulting services operate in almost every industry. Some of the most common include:

• IT Consultant: Focuses on improving the use of software and hardware so companies can achieve more profitable business goals. (NAICS code 54151)
• Real Estate Asset Management & Consulting: Helps people and businesses make better decisions involving real estate investments. (NAICS code 53139)
• Business Management Consulting: Advises businesses to better manage company resources including people, money, and supply chains. Typically broken down into smaller segments. (NAICS code 54161)
• Human Resource Consulting: Focuses on advising companies regarding hiring, meeting employment law, payroll management, and navigating the job market. (NAICS code 54161b)
• Marketing Consulting: Focuses on helping people attract clients through marketing campaigns, writing services, social media marketing, and brand consulting.
• Environmental Consulting: Consults on the environmental impact decisions have. These are especially common in the oil & gas industry, as well as in construction near protected habitats. (NAICS code 54162)
• Economic Consultant: Advises business owners on the industry outlook and other micro- or macro-economic issues. (NAICS code 54169)
• Sales Consultant: Helps businesses improve their sales strategy or improve the sales team’s performance.
• Tax Consultant or Financial Consultant: Helps businesses find ways to improve their financial results through accounting practices. Will normally be a Certified Financial Planner.

This is not a definitive list. There are good consultants in almost every industry. There are even gardening consultants that advise people and businesses on what plants will work best in the environment.

Which Business Model Is Best for a Consulting Business?

There are numerous business models consulting businesses use. As you choose a consulting business model, you’ll need to consider how you want to find clients, what your skills are, how many clients you want, and the revenue you want to achieve. Four of the most common consulting models are:

• Solo Consultant Model
• Productized Consulting Model
• Consulting Firm Model
• Hybrid Consulting Model

What is a Solo Consultant?

A solo consultant is commonly referred to as an independent business consultant. These consulting companies are focused on personal relationships with clients. It’s how most small consulting businesses will start, including Ryan’s.

Hear more in the rest of our interview below.

A solo consultant will normally want their consulting services to be focused on:

• A small number of clients
• High-value clients
• Building personal relationships
• Clients that need unique solutions

It’s hard to sell these businesses though because they are directly tied to the consultant. You’ll normally want to progress to other types of consulting models as time goes on.

What is a Productized Consulting Model?

A productized consulting model focuses on creating a process that the consulting service can use over and over again to create terrific results. This is common in technology consulting.

Ryan also engages in productized consulting to a significant degree. He told us:

Many restaurants have difficulty systemizing their operations. We typically systemize these first:

• Build sheet

Then build upon them to help a restaurant start improving margins. We do this because they are easy to understand and can  generate results pretty fast.

This is basically an evolution of the solo model that makes it more sellable. People who wish to build consulting firms should also use this business model to make their consulting services more consistent across consultants. 

Let’s talk about the consulting firm model next.

What is a Consulting Firm Model?

A consulting firm is a natural progression from a productized model. Consulting firms focus on having a team of consultants that can help clients achieve their goals. You might see this consulting business model in major accounting firms, tech companies, and more mature consulting businesses. 

These firms will be focused on getting as many potential clients as possible. Because they have other consultants to give expert advice, they are not limited by the constraints of a solo consultant.

A business owner who starts a consulting firm will be more focused on managing people than serving clients. Their earnings will be based on how well employees provide results for their clients. 

Have you considered a Hybridized Model?

Most businesses will mix and match the different consulting business models to create a business that works best for them. When you start a consulting business, it makes a lot of sense to include elements of the productized business models to streamline your consulting service.

What Is the Industry Outlook?

The consulting industry has five million businesses that generate a combined $2.4 trillion of revenue in the U.S. IBIS World expects consulting business revenues to grow by 2.5% annually through 2026. The profit margin is expected to stay fairly level at 7.9% of revenue.

Who Are the Major Players in the Consulting Business?

The major players in the consulting industry include:

• Accenture PLC : Market leader in most types of business consulting
• IBM : IT Consulting
• Jacobs Engineering Group : Environmental cleanup and construction
• Omnicom Group : Marketing and PR
• Kirkland & Ellis : Law firm

Small Players: You don’t have to be a multi-billion dollar corporation to make a great living. We’ve interviewed marketing consulting companies and brand consultants. Check out some of the other consultants with whom we have met:

• OnStrategy : $6 million annual revenue Strategy Consultant
• Kristin Cutura : Former Google Employee turned Google Ads Consultant
• Libby Gill : Brand and Leadership

How to Start a Consulting Business

To start a consulting business you’ll want to focus on:

• Writing a plan for your consulting company
• Funding your consulting
• Naming your consulting practice
• Meeting the legal requirements for a consulting business
• Market your consulting business
• Submit client proposals
• Perform business consultation

We created a checklist for you to build your startup consulting company.

Write a Consulting Business Plan

You don’t absolutely need a business plan, but it helps keep your business on track. If you decide you want to create a business plan, consider including:

• What consulting services you will provide: HR Consultant, Accounting consultant, management consultant, marketing consultant, IT consultant, brand consultant?
• Target market for your consultant business: What size companies will you target? What industry will they be in?
• How most consultants in your industry operate: Do they use affiliate links, provide implementation, or just advise?
• Your Business Model: Will you be solo, productized, firm, or hybrid?
• A Marketing Plan: How will you market your consulting company?
• Other Expenses: What other business expenses do you expect and how will you cover them?

Check out our blog How to Write a Business Plan or watch our interview with Mike Andes below. 

Funding Your Consulting Business

Whether you’re a marketing consultant, human resources, or one of the many other types of management consultants, your consulting business will need funds to keep going.

The most common ways of funding a business are through personal funds or loans from family and friends, but there are a variety of other methods available to people with good credit and some assets. 

Many people talk about SBA loans , but they frequently require two years in business and that all other options are exhausted. So, you can apply for them, but it would also help to check out our blog about funding options to find 17 ways to fund a business .

How much profit can a successful consultant make?

According to IBIS data, the most profitable of the top five consultants makes a 23% profit margin, which is nearly a $1.9 billion profit on $8 billion revenue. Not too bad!

The average consulting business makes $466K and has an 8% profit margin. I would attribute this apparently low percentage to consultants paying themselves a salary, benefits, and tax deductions, like home offices. 

If you combine the profit with a wage of $80K to $100K based on the Bureau of Labor Statistics , that means that a new consulting business can make around $140K.

There are a ton of benefits available through starting a Limited Liability Company or S-Corporation that can reduce profit but improve quality of life. Those who are particularly good at operating lean can drive results much higher than the average. In most years, I aim for a 28% percent profit margin.

How much does it cost to start a successful consulting business?

Starting a consulting business can be fairly low in cost. IBIS World found that consultants spend approximately two cents on capital expenses for every $1 spent on wages. That means wages and other expenses should be less than 50% of revenue. This number doesn’t include taxes.

Expect to need the following when starting a consultant company:

• Business Formation : Free to $1,000 annually
• Internet : $30 to $200 monthly
• Website, Domain, Hosting : $100 to $25,000+ monthly for lower end or one-time plus upkeep for higher end
• Computer : $600 to $3,000
• Software and Other Equipmen t: $250+ per month
• Marketing Budget : 8% of the revenue you want to make

Check out our blog about business startup costs to learn more about budgeting during the startup phase.

Most of the costs on the list you may already have, which is why starting a consulting business is easy to start without additional funding.

How to start a consulting business with no money?

Like many small business owners, Ryan was successful at starting a consulting business with no experience in consulting. Because his client wanted input from his success as a chef, he didn’t have any expenses before his first business consultancy.

You can start your own consulting business this way too. If you want to find potential clients, try platforms like Upwork or Fiverr . We’ll dig into more ways to find consulting jobs, but both of those sites are useful if you want to know how to start a consulting business on the side.

Naming Your Own Consulting Business

Every business will need a name. You’ll want to make sure it is easy to remember and that it describes what you do. In addition, you’ll want to make sure the name is available on social media and as a website domain. Check on GoDaddy , or similar, to make sure your name is available and then purchase your domain.

If you are struggling to come up with names, try the UpFlip name generator or the business name generator from Shopify.

Get a domain name

NameCheap offers domains, sometimes for less than a dollar. You can also find domains from any web builder or:

• Google Domains

Get ready to hear about legal requirements for consulting companies.

Meeting the Legal Requirements for Consulting Services

After you’ve come up with your business idea and chosen the name for your management consulting services, it’s a good idea to hire legal representation, which can also help get your business started quickly.

Hiring a professional to help you with the legal requirements frees you to focus on strategy and operations.

Each state has different permits, licenses, and tax forms to start a new business. You can find information on what is needed on the SBA website .

Keep reading for information on different legal structures.

Sole Proprietor

A sole proprietor has unlimited liability, but it is the easiest business structure to create.

If your business gets in a lawsuit, your personal assets are at risk. For most types of consulting, I would avoid a sole proprietorship unless you cannot afford the additional costs of an LLC or a corporation.

Sole proprietors file taxes with a Schedule C . Sole proprietors can also join the American Independent Business Alliance .

Limited Liability Corporation (LLC)

LLCs are common in the United States because of the liability protection. Each state has different requirements to get an LLC. Find your state’s requirements .

Many business owners will opt to have their LLC file as an S-Corp with the IRS. To learn more check out our blog LLC vs S-Corp . 

Stay with us for additional business structure styles consultants might use.

Partnerships and Corporations

Partnerships and corporations are common in the consulting industry, especially for accounting consultants, lawyers, and other professionals. You’ll want a partnership agreement filed with your state.

Many of the largest consulting firms are corporations with stock holders. This helps them access alternative means of fundraising. Executives who want to grow their small businesses into marketing consulting firms or HR consulting empires with thousands of  HR consultants might want to start a corporation.

Learn more about the different types of business structures in the industry.

Apply for an EIN

You’ll need to get an employer identification number from the IRS website. The IRS uses this number to match employee taxes to company taxes. We walk you through the process in Step 4 of how to register a business .

Sales Tax Permit

If your state has sales tax (most do), you’ll need to get the sales tax permit or license. Avalara has a guide on Sales Taxes . Check it out.

Tax filing and withholding

You’ll need to file taxes and withhold payroll for employees.

The IRS guide for employers provides guidance on payroll. 

Federal employment and labor law posters

You’ll need to get Workplace Posters plus abide by:

• A state’s New Hire Program
• Employment Eligibility Verification (Form I-9)
• Worker’s Compensation Insurance
• Occupational Safety and Health Administration (OSHA)
• Disability Insurance—each state is different

Unemployment Insurance

Review the U.S. Chamber of Commerce information on unemployment to comply with UI laws. Federal UI is $420 per employee plus any state expenses.

We’ve covered the legal requirements for consulting businesses. Now, let’s look at how to grow your consulting business through marketing.

Grow through Marketing

You can find potential clients through a variety of methods, but every good consultant will use at least some of the ideas in this section to attract small businesses looking for his or her expertise.

You may want to partake in all of these as you begin marketing:

• Market research
• Marketing plan
• Launch a website
• Marketing on social media
• Growing your email list
• Tapping into and growing your network

Keep reading for more information on marketing.

Market Research

Market research is about identifying the demand for your consulting services. This includes:

• Defining the industries you want to service
• Identify the size of companies you want to service
• Establishing the best way to reach these companies
• Finding common requirements for the industry you’ll provide services.
• Identifying industry trends
• Recognizing gaps are in the market

Ryan told us market research is about:

Who are their ideal guests? Where do they hang out?

He also advised business owners to recognize whether they are a commodity or unique entity. He told us:

Your menu is your product.

Products have to be different. If it’s the same as everyone else, you are a commodity and are competing on price.

Unique or Commodity? Recognize what you are…

Check out our blog about market research to learn more about gathering this data.

Create a marketing plan and use it

Marketing plans can be simple or elaborate, but they should be focused on providing your customers something of value. Ryan told us this is basically his marketing plan:

• Create meaningful content on my YouTube channel.
• Link to a free resource list or a free book to collect emails.
• Share new content through emails.
• Future clients can reach out for advice on their own business efforts.

“Give away the ‘WHY?’ and sell the ‘HOW?’

That’s the general rule and I cross it all the time. We give away some of the how. Some people might say too much of the how, but I don’t want anyone to go through what I went through.”

In your plan it is important to specify the channels you’ll use, the budget, the expectation, and create a brand guideline to help keep marketing aligned with the brands values, fonts, and colors.

Ryan also advised if you really want to stand out, “Follow the influencers in your industry and do more of that.”

He also reminds business owners not to forget loyalty programs. In consulting, a loyalty program can be anything from a discount after spending a certain amount to a plaque for being a preferred client––something to let them know that you appreciate them.

You may want to include marketing options like the following:

• Social media marketing
• Business writing (Blogs and White Papers)
• Working with editorial services
• Hiring a Public Relations Consultant

Ryan told us the restaurant industry doesn’t have much success with print except for delivery services.

Door hangers are still highly beneficial and trackable.

This might not apply to your business, but you have to love free tips for client projects. If you’re in service business consulting, make sure to suggest door hangers too. Check out our blog about how to get cleaning clients with advice from the owner of Bumble Bee (formerly Queen Bee) Cleaning Services. 

Chris has some advice and techniques that could help most industries. He’s been a keynote speaker. You can learn a bit about some improvements that he’s made in our video below.

Build a website

Every consulting business needs a website. You should review competitor websites and then hire a brand consultant with a developer on staff to help build your website. Make sure they have a marketing consultant with SEO credentials to help you rank faster.

If you want to try building your own website as an independent consultant, check out our blog about how to build a webpage .

Marketing with Social Media

With consulting, you might have to get a little creative with how you target small businesses. Many small business owners are on LinkedIn, but is that where they are spending most of their time?

As a B2B consultant, you’ll want to be where you can find people who need your help, which will typically be on the sites where their customers are. Sprout Social has a great blog about time spent on social media by channel and demographics.

Grow Your Email List

Email lists are some of the most powerful marketing tools to reach potential clients. You can use them to remind people about changes in the industry, promotions, and other information that can help your customers.

I’d suggest following MailChimp’s blog to develop your mailing list.

Tap into Your Network

Networking is an essential part of every consulting agency. The more people you know, the more potential clients you will come across. Make sure to be focused on giving them value. You’ll probably always want to have business cards available to hand out in unexpected places throughout your day. Make sure to keep them in a case to keep them in good condition.

Running Your Consulting Business

Running a business in the consulting field may require:

• Hiring employees and payroll
• Submitting client proposals
• Helping customers

Hiring Employees and Payroll

Ryan discussed hiring in some detail. He had some great words of wisdom.

A great coach is strict, but you can never be mean to your team. If you aren’t getting the results you want, try being nicer but not more lenient.

Most importantly he emphasized:

Manage systems, and develop people. People don’t want to be managed. People want to grow; they want to get better.

 A good consultant will probably need some employees. If you hire, you’ll need to:

• Post job openings
• Conduct interviews
• Decide fair pay
• Manage tax filings and withholdings
• Obey labor laws

Follow along for more information on each step.

Job Posting 

A good consultant will probably want to hire people and agencies to assist with client projects on a project-by-project basis. This means businesses in the consulting field should find employees on sites like:

During interviews, you’ll want to ask about:

• Examples of previous work: Understand that many will be protected under a Non-Disclosure Agreement (NDA). Be willing to accept reviews.
• Availability: Most professionals will be remote. If you want someone who is available between specific hours specify that in the job post.
• Experience with software: You need people who know how to use the tools you use.
• Employee values: Every company values specific traits that vary. One might be focused on growth, while another is focused on cost cutting. It doesn’t help to put people who are focused on growth in a company trying to cut costs, they won’t fit.

Ryan told us:

They have to want to be social. You can train the rest. Look for people who want to have fun doing it, then teach them.

Compensation

Clients pay consultants based on the project or for an ongoing service. If you are paid by the project, you’ll need to make sure that you can pay people working for you. I normally require a retainer for 20% plus any expected costs for new clients.

Most consultants make between $80K to $100K for full-time work. But there are different ways to compensate for consulting in business. 

The team has to be built and maintained. Figure out the rewards for employees. It doesn’t have to be all monetary.

Salary means they get paid the same amount no matter how much they work. Only full-time people who have not engaged in mission-critical aspects of the business really qualify for salary. Paying someone a salary can expose you to overtime liabilities if they are misclassified.

Consulting salaries typically run between $80K and $100K.

Hourly contracts make the most sense for many consultants. To convert from a salary to hourly, use the formula:

Salary / (2080) = Hourly

Fixed Price or Commission

Many freelance consultants will charge a fixed price based on the project. This model is also used if a consultant uses affiliate marketing programs to increase their revenue. 

The fixed price model works when it converts to a comparable or higher rate than the billable hour. To make sure you know whether you are billing correctly, you’ll probably want some kind of a time tracker. There are a variety of types based on your needs. 

I’ve personally used the following, and they are listed in the order I prefer them:

• Screenshot Monitor : Captures screenshots, time tracking, plus manual entry
• Upwork time tracker : Only for billing on Upwork
• ClickUp time tracke r: Built into ClickUp features (I don’t love it.)

There are plenty of other options, including HR outsourcing companies (Check this out if you are going into human resources consulting. Make sure to join their affiliate programs.) and other software providers .

Submit Client Proposals

One of the most important aspects of how to be a consultant is submitting proposals. You’ll want to have the following ready to create proposals:

• A questionnaire to establish what challenges new clients are experiencing.
• A proposal that outlines what you will and will not be doing in the process.
• Contract templates that should be filled out and sent with the proposal.
• Invoicing and payment system for current and new clients to pay for their consulting.

There are plenty of tools that you can use to accomplish all of these, but we suggest Monday.com .

How to Retain Customers for Your Consulting Business

“Reputation! Reputation! Reputation!”

Keeping customers happy is about providing a service that improves their bottom line. That means, with everything you do, you need to consider how it’s going to make their business more profitable.

In human resources consulting there are always ways to improve retention rates, lower the cost of recruiting, and other aspects that industries hire consultants to help develop.

Meanwhile, a consultant in supply chain management might create a career consulting businesses on:

• Reducing inventory
• Reducing transportation costs
• Sourcing locally

There are a ton of other ways where you can build a career in consulting, but you have to generate results to keep booking clients.

Find a far more successful consultant and learn from them. Most of the best consultants will be at industry events or have massive followings. Check out some of the top influencers next.

Top Consulting Influencers

There are a ton of amazing consultants, but here are some of the best:

• Gary Vaynerchuk takes risks and shows new ways to market a business. He is a one to follow!
• Tony Robbins has helped ShakeShack, Airbnb, Salesforce, Serena Williams, and Aerosmith improve their brands.
• McKinsey & Co is considered the most prestigious consulting company by consultants.

Ryan gave a lot of great input about how to start a consulting business. You just have to decide what your expertise is and go from there.

If you’d like to learn how to start a marketing consulting business, check out our podcasts, youtube, and our blog about Socialistics . 

What kind of consulting business would you like to start?

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