Thinking of Starting A Consultancy Firm? 10 Hacks That Guarantee Success
Starting a consultancy firm can be understandably daunting. As a consultant, all you want to do is build and share your expertise while getting paid what you are worth. Often is the case that in the formative stages of consultancy you’ll get by doing just that. However as success comes by, the need to set up shop as a consultancy firm soon is apparent. Here are ten hacks that will guarantee success of your consultancy business, ensuring its growth from small business to enterprise.
Get the requisite Qualifications & Regulatory Approval for your Consultancy FirmA PhD is good when setting yourself up to run a consultancy firm, but professional qualifications are better. Most business seeking the services of a consultancy are seeking expertise in nuances of their operations that would augment, not supplant their in-house expertise. For example, the services of a certified internet marketing professional would present more value to the marketing efforts of company X than a PhD in marketing.
A growing number of professional accreditation bodies not only accredit individuals, but also entire operations. Make the most of this trend by investing in memberships, both for yourself and your consultancy firm. Professionalism manifest by peer approval strikes gold in the business of consultancy. Affiliation to professional bodies within and without your jurisdiction pays dividends in the form of:
- access to journals that keep you abreast with the latest trends in your industry;
- discounted rates for conferences that the golden goose of networking;
- access to business through referrals when professional bodies market their reach to global partners.
Form a Company
Simple, it wouldn’t be a consultancy firm were it not a company. The temptation of moonlighting as an individual is immense in the formative stages before one sets shop. Principally because the ease of executing a side hustle is enchanting – hustle an opportunity, do your thing and get paid. But the vulnerabilities of conducting your consulting business this way are numerous.
First, you forgo the chance to build a brand. Brands are intellectual property that may pay for a lifetime. Secondly, deepening your offering of consultancy services is easier with a company. A company is a vehicle by which to engage experts in other fields either as partners, shareholders or on a retainer basis.
Thirdly, a company may offer better social protection against the perils of being an entrepreneur in the 21st century. Taxation benefits, in some cases, is the first safety net. Financial liability safeguards that a company can be structured to offer also come to mind. Access to funding through venture capitalism, sale of company shares and commercial loans is another. As your consultancy firm grows, benefits like group life cover and health insurance come within reach.
Make use of shared office space
The cost implications of giving a company an existence through acquisition of a physical address, postal address and office services present real challenges to setting up a consultancy. Thankfully, modern innovations in shared office space have helped numerous business incubate and grow. For an hourly, weekly or Monthly fee you can access not only top of the range office space but also needed professional receptionist and secretarial services.
Explore what business parks in your locality offer. Is there a shared office space for lease that other consultants have a liking for? How ideal is the location? For instance, a consultancy firm offering energy audit services for the manufacturing sector might find it useful to be located in proximity to an industrial park.
Conduct Market Survey on How Much to Charge
As this Entrepreneur article advises, the easiest play to finding a level on your charges for consultancy work is to pose as a customer and spy on your competitors. Communicate a range for any additional costs that might arise in advance. Be mindful of the value preposition of your competitors compared to your offering for a given price range. Never play the price game by undercutting. Price undercutting only cheapens your credibility. Value is found not by jargon or by splitting hairs on the depth of your offering. Demonstrate value to prospective clients by reading the map and clearly delineating the route. Simply, get your clients out of the forest with the least words possible.
Be Careful With Pro Bono Work
Pro bono work with your church, local women’s group or non-profit has its benefits. Principally, such work helps build your brand equity by grounding your consultancy firm in the community. However, as a business owner, you need to be mindful of costs incurred. Too much pro bono work can cripple your ability to do work that actually pays the bills.
Negotiate for your counterparts in such engagements to bring in partners who will help offset most of the costs. Ensure that your consultancy business reaps other non-monetary rewards such as: recommendation letters, on site advertising, blog posts and links to your website. However, we still urge for moderation. As creatives curtly put it: exposure doesn’t pay bills.
Agree To Terms Before Any Engagement
Whether pro bono or not, clearly spell out terms of engagement before taking up business. Be particularly wary of charlatans out to get the value of your expertise for nothing. Here, Robert Green’s 40th law of power “despise the free lunch,” suffices. Their generosity makes you vulnerable blurring the line between selling and consulting for a cup of coffee.
Activate your Contacts
Business contacts are first personal contacts. It is much easier to do business with an acquaintance. As Peter Thiel prescribed in the startup bible Zero to One, the ticket to big money sales lies in painstaking, long haul building of networks and relationships. Picking up new hobbies is a good place to start especially when making the transition from employee to business owner by starting a consultancy firm.
Consultancy is largely B2B. Therefore, you’ll be selling your services to other business owners, entrepreneurs and decision makers. Before trying to sell, find and make them your contacts. How do business owners spend their free time in your locality? What memberships do entrepreneurs within your target market hold? Which social responsibility activities are they involved in?
Start A Blog
Like any other endeavor of scale, effective business communication lies at the heart of success with your consultancy firm. While the host of tools available for selling are a dime a dozen, blogs, podcasts and running a You Tube channel are particularly useful in showcasing your expertise to prospective clients.
You could blog about emerging trends in your field and build visibility and credibility as a source of incisive knowledge for your niche. The collaborative nature of the internet could help forge alliances of interest and benefit with those in your space. Moreover, enriching conversations might stem from content consumed by experts sharing in your passion, thereby deepening your knowledge in the field as you gain from different perspectives.
Leverage on Technology
Success in running a consultancy firm on a budget is dependent on your proficiency with modern tools of remote working such as google docs, Zoom and Skype. Moreover, you should gather all the tools specific to your craft given the increasing breadth and functionality of open source artificial intelligence software with data handling capabilities.
Accumulate Local Knowledge
Beyond fancy terms and innuendos, running a consultancy firm is nothing but being a fixer. Refinements in the art of local fixing is that which enables global firms do local jobs proficiently. Journalism realized the undeniable worth of local fixers who enable front-line reporting by the award-winning journalists from virtually every hole in the world. Fixers set up interviews, navigate local terrain, ensure dangerous situations are averted or avoided. They are at the heart of every story in the global village of the 21st century. Local knowledge makes fixers the bridge they are. Consultancy firms are the bridges of modern enterprise and just like fixers in journalism, merchants of local knowledge.
7 Ways To Accumulate Local Knowledge For Your Consultancy Firm
- Consume with zest national and local legislation, government policy papers.
- Attend conferences, proceedings of professional bodies and regulatory bodies.
- Keep an eye on the courts for rulings that directly and indirectly affect your industry.
- Conduct and sponsor local research.
- Read journals carrying content on your industry.
- Follow on social media industry influencers and trend setters.
- Organize talks, hakathons and other events centered around your industry.