How to Start a Consulting Business

Last updated on March 12th, 2022 at 12:12 am

Everyone is good at something. In fact, you’ve probably cultivated a certain level of knowledge about a few talents you may have, to the point where your friends and family will ask you for your insight regularly.

If you feel like you want to try a new experience in the consulting business, you may find interesting the next paragraphs below.

Owning Your Own Business

In today’s world of infinite online possibilities, many people are striking out to form their own businesses. One very popular role is that of the consultant. But what exactly does “being a consultant” entail? Can anyone be a consultant? How will you find clients and get paid?

Let’s take a look at how to start a consulting business. You may be closer to realizing your dreams of owning your own business than you think.

What… or Who… Is a Consultant? 

A consultant is, by definition, an expert who advises others regarding a specific topic or field. This makes it sound like anyone can be considered a consultant, and for once, that’s actually true! If you are truly gifted in a particular field or skillset, you can become a consultant.

Great with numbers and tax regulations? You can become an accounting consultant.

Have a special knack for marketing, building networks, and conjuring keywords that win clicks? Maybe you’re ready to be a marketing consultant (we have some interesting marketing articles here).

Are you particularly gifted with a very green thumb and an almost unnatural ability to plan the perfect landscaping? Even gardening consultants are highly sought-after these days. 

Everybody needs a helping hand sometimes, especially those who are swamped with a million other tasks vying for attention. A consultant is someone who can swoop in on a temporary basis to analyze the situation and provide a variety of viable solutions.

Consultants are highly valued by small or online businesses for their ability to diagnose and problem-solve a variety of issues without requiring the business to hire full time staff.

These smaller companies may not have the budget or long-term need for a full-time staff member, so working with a consultant on a temporary basis may be exactly what they need to get past a particular hurdle, or to help them find the groove they need to continue business in the right direction.

Read also: How to Become a Virtual Assistant

How To Become a Consultant?

First, you’ll want to decide what kind of consulting work you’d like to perform. As mentioned earlier, you could consult in anything. Pet training. Human Resources policy. Social media accounts. Web design. Content creation. Anything that you’ve been asked to help others with because “you’re so good at it!”.

Before you have your business cards printed, you’ll want to do some serious research. First, is there a market for what you can do? This is not meant as a personal slight, but in some areas, there may be a greater need for your talent than others.

A metropolitan area filled with high-rises will likely be less inclined to hire a garden consultant, but the harried workers might be thrilled to have a pet trainer they can reach out to.

Next, check the competition. Who else is doing what you can do? This might take a little more digging, but a quick Google search for your location plus the type of consulting work you’d like to do (“social media consultant Columbus Ohio”, for example) will not only help you see who else is out there, but what type of feedback they’re getting and types of project samples they’re sharing as well.

This can give you even greater insight into the market you’re about to enter. 

You’ll also want to check on any certifications or special licenses that might be required to do business as a consultant. Be sure to check on the state and Federal level to make sure you don’t miss anything. Some licenses or areas may also require you to create an LLC in order to run your business appropriately within the IRS framework, especially if you’re looking at high-ticket consulting work.

This may seem like an impossible dream today, but bear in mind that some consultants can get paid hundreds of thousands of dollars each year.

With possibilities like that on your horizon, it’s important to do the hard footwork now to ensure your business can prosper and grow exactly like it ought to.

Read also: How to become a Freelance Pinterest Manager

Starting Your Consulting Business

Speaking of income, you’ll also want to get a feel for how much you charge. There are three main ways in which consultants are paid: hourly, per project, or on retainer.

Option #1

An hourly rate is pretty self-explanatory: you’ll get paid by the hour for each project you work on. This can be helpful when it comes to receiving a regular income, but you will need to keep very detailed records of when you work on projects, and what you’re doing during each work session.

Option #2

Per project payment means less regular pay; however, you can reap great rewards here without having to keep track of each increment of time you spend thinking about the client’s tasks. With a set amount as well as a project due date and payment dates agreed upon ahead of time, you can focus on the project at hand completely.

Option #3

Working on retainer is another way to receive a regular income. In this model, you’re paid a certain amount each month, regardless of whether the client requires your assistance or not. Before you agree to work on retainer, make sure you create a detailed contract with your client.

Some clients won’t allow their consultants on retainer to work for competitors, or even other companies vaguely related to their own.

Organizing our Business (And Where To Start Online)

Once you’ve determined your payment structure, it’s time to organize your business. You’ll need to come up with a marketing plan of your own, and it may be beneficial to create your own business site and social media accounts to help with networking.

Consulting requires a lot of networking to spread the word about your new business, so you’ll want to be thorough in your efforts.

Another option is to start small, perhaps as a freelance consultant. There are several online sites where consultants can get experience – and thus recommendations – for their knowledge and talent.

Sites like Upwork or Fiverr (read a detailed review here) are great choices for connecting freelancers with clients, and can help you build the professional portfolio you need to start heavy networking for your business.

After all, while it’s fantastic that you’ve been such a great help to your auntie with her website, clients aren’t necessarily going to be impressed with a non-professional portfolio.

Starting your own consulting business will take a lot of legwork at first. You’ll need to do plenty of research to get a feel for the market and rates for your particular skill set. Still, those who are truly talented may find this to be a passion project, as the idea of working for yourself, in a field you love, can be very appealing. 

It may take some time to gain your footing and find a dedicated client base, so don’t become discouraged if you don’t hit superstar status in the first year. Continue to learn and expand on your area of concentration, and you’ll become the trusted expert businesses and individuals alike need.