A new era is dawning for business consulting: Recent predictions for 2016 and beyond show that the boon in other industries is spilling over into the consultancy segment, meaning amplified growth for this latter part of the market.
Then there is the question of groundwork. And, here, I am consistently surprised by how little it takes for modern entrepreneurs to become consultants. After a short setup, almost anyone with valuable business experience can begin offering advice for a fee, and there's nothing fraudulent there: To people without specific industry experience, good advice is worth every penny.
The problem is, consultants today frequently fail to establish sustainable markets for their services. So, for the right entrepreneur, the following advice on getting started as a consultant may be key, because the field is both a profitable venture and a way to help others become great at what they do.
1. Roadblocks to consultancy
Because the barriers to entry are so few, the market is overflowing. And that's fine. But what isn't is the statistic that 61 percent of consultants last less than five years. So, for most consultants just starting out, and standing out from the crowd of wannabes, is the first and most daunting challenge.
Consultants don’t have a universal Good Housekeeping seal of approval, so clients may struggle to discern the charlatans from the experts. One client with unreasonable expectations and an Internet connection may glean bad reviews and create a major setback for others in the same field.
Until consultants establish a universal stamp of trustworthiness, con artists and reviewers will continue to dupe clients, making them hesitant to trust someone who actually has the answers to their problems.
Speaking of problems, consultants rarely have the luxury of partnering with businesses when everything is going well. Companies bring in consultants when they have problems they can’t solve on their own, and that means that each contract brings a unique challenge. While never living the same day twice is part of the consultant job’s allure, it’s also a challenge that weeds out all but the most capable consultants over time.
2. Establishing yourself as a consultant
Setting measurable standards and clear expectations clients can see up front will set you apart from the masses. By giving clients something they can compare you to, you give yourself a leg up over the thousands of others trying to get by on salesmanship alone. Some other strategies for starting out:
1. Own your image. Take full responsibility for clients’ perceptions of you and your value to them as a client. If you get a lot of requests for free advice, take that as a compliment that what you have to offer is sought after. But beware giving too much away: When you consider that mega-companies like Hill International make millions -- Hill's consulting fees amounted to $161.5 million in just the fourth quarter of 2015 alone -- you're looking at evidence that you may not be presenting your services in a way you want them to be valued.
I often have consultants who bemoan that they aren’t understood in the marketplace or colleagues who struggle with their careers and senior leaders’ perceptions of them. In those cases, I say, “Get over it, and take ownership.” Every email I write and every word I speak is a reflection of my brand.
2. Make it easy for clients to acquire your services. I am a huge advocate in and believer that people deserve the truth and can handle the truth. Clearly explain what you offer, how much it costs and what you can help clients achieve. Build a large online presence. Often, people ask for free advice because they don’t know or understand what’s available to purchase. Make it easy for clients to purchase -- and distinguish among -- a package, a one-time consultation or a retainer agreement.
3. Take the sales initiative. It’s your duty to your new consultancy business to take the lead on selling your product. Don’t assume someone who asks to pick your brain isn’t willing to pay good money for detailed expert advice. You’re running a business, so gently lead your prospects away from the "free" path of sample wisdom, to the paid path of full consultancy.
I am most comfortable talking about and promoting something when I truly believe in it and it’s aligned with my purpose in life. I work only with clients who treat their employees and clients the way I myself expect to be treated.
4. Recognize unprofitable avenues. Some people will try to needle information out of you without any intention of paying you for it. One of my biggest mistakes early in my career was saying “yes” to everything and anyone who wanted my advice. This got me involved in deals that didn't complement my strengths or my vision of the business.
Have the confidence to draw a clear line between what is free and what is a paid service. It’s hard to walk away when you’re trying to establish your brand and customer base, especially when only 11 percent of consultants last more than 10 years in the business, according to the above source. But you must show that your time and wisdom are valuable, or people won’t treat your product with the respect it deserves.
If you have the industry experience and business savvy necessary to become a consultant, use those qualities to establish a reputation of trust and earn repeat customers -- there will always be room for someone who can help young businesses grow.