Starting a consulting business seems to be an interesting idea. If you are good at analytical skills and explaining to people several issues, you can feel an interest in it. You can seek many benefits by being a consultant. You can adopt a flexible approach and decide how much to work, whom to work with and when to work.
It doesn’t take substantial capital to start a business. But remember that you need to stand out in the industry; you should be different, you should be unique, you should be helping people out and make a difference in their lives. People coming to you won’t expect you to speak something; they expect you to consult them and suggest something valuable that will change their lives.
Hence, when you get into the consulting business, you should stop being mediocre. You are there in the industry to create value, add meaning to people’s lives, and help them out in a certain issue. So, it is not just about setting up a company and opening up a lavish office; consulting is beyond that. It requires practical implications of your skill, so get ready with it.
9 actionable steps to start a consulting company are as follows:-
1. Get ready to know about your specialisation
Starting a consulting business has two stories:
- When you know a great deal about financial services, legal advice, marketing, and sales, etc. and want to help people out, you decide to get into consulting, or
- You want to start a consulting business, and then you explore the field in which you are proficient and can be of help to other people.
So, when you decide by either of the ways, your next task is finding a niche. You are a consultant; you are a pro in your field. So, whichever field you choose, ensure that you are passionate and knowledgeable about it. You ought to be an expert in it. Don’t be generic; you can’t be advising on all topics to everyone.
You will be amazed that there are plenty of niches out there. For instance, if you like to talk about money matters, you can provide consulting services in insurance, financial services, mutual funds, tax consulting, and so on.
If you think that you are not knowledgeable enough about the field you like, it is time to learn and explore before you set up the business. You can attend workshops, read books, do certified courses, or even get a degree. But we will always suggest you keep the learning thing simultaneous with the business; you will have to learn about new trends.
2. Prepare a comprehensive business plan
Once you are prepared with qualifications, knowledge, and certifications, it is time to get into business. But first, draw the roadmap and know where you want to move ahead in life. The reason why you are into consulting is clarified in the initial part. Now, you have to decide how you want to get into it. So, with the help of experts, mentors, and business partners, write down the plan.
You can find a lot of information about writing a business plan, and we will suggest you stick to one or two of these. Since too much information causes confusion, do not overburden yourself. Keep it short and simple, and your plan should look practical and not idealistic.
- What is a business plan ?
- How to write a perfect business plan ?
- 9 Major components of a business plan
3. Decide on a business structure
We know you must be more interested in deciding the business revenue models, but first, you are supposed to determine the best business structure. Each one has its pros and cons, but if you are more than one business partner, then a Limited Liability Partnership is preferred.
4. Choose an appropriate business model
Before you set up the pricing, you need to formulate a robust business strategy. Each model has its advantages and loopholes; you need to go through the same and choose whichever suits you. We have listed out some of the business models as below:
- The Time-based model – It is the simplest model ever. You have to set an hourly rate or a day rate and convey to your clients the same. This offers simplicity and control, but you are supposed to maintain records every day, and it could be time-consuming.
- The Project-based model – You set a fixed amount of money for a particular project, depending upon its nature. It requires contract-signing, but it is another more straightforward approach. However, the problem arises when you don’t estimate the time required to complete a project, and it could be unpredictable.
- The Retainer-based model – You provide services on a continuous basis or when the client asks for the same. There is no fixed deliverable or time limit. You have to be constantly on the go, and estimation could be an issue. But there is a predictable flow of income.
- The Consulting firm model – This is a typical model in which you have clients and a team to handle the work. So, you can focus on business development while your team gets the work done on time.
5. Get the money matters on track
The foremost step to take is to set up an accounting and bookkeeping system in your business. If you tend to have investors, partners, and an appropriate business model, you should know where the money comes and goes. It is surprising that business entrepreneurs wait for the business to expand and mess up later in their accounts. We suggest you set up a concrete accounting system first, and subsequently; you can tap more clients and expand your business.
Another thing to do in this phase is to consider financing options. You won’t need a huge capital to start your business, just the basic things like physical office space, furniture, and costs for company formation. But we suggest keeping a ready plan to avail finance as you might need money to take your business to the next stage. If you do not have sufficient funds to set up space and get the regular office supplies, then financing should be considered first.
6. Develop your brand
In the year 2021 and further, you can see only brands thriving and trending, and you ought to be the next one if you want to succeed. Even if you are a small business owner and are starting out, you need to have a full-fledged brand. Take your brand seriously because it matters first for the customers.
You can attend brand management workshops online, approach a graphic designer, and create a dream brand for yourself. A brand is not just about the fanciest logo; it is about the personality your business has. So, you have to be a lot strong and clear when you set intentions for your future brand.
While you create your brand identity, we suggest keeping ideas ready for your online presence – official website and social media handles. Where would you like to be on social media? (It depends largely on the type of consulting niche you have chosen). How would you like to have your website? Though you can set up an online presence later, it is advisable to have a clear idea about it beforehand. You can implement the technical details later on.
7. Form your corporation/business structure
It seems we have covered most of the pre-formation tasks in the above part. Now comes the real thing to do. Form your business structure; it could be a corporation or partnership; it depends on who will be transacting the business and which business structure suits your requirements.
You can appoint a business attorney or consult an expert to get the work done quickly and efficiently. Remember; it is a complex and critical task to form a corporation, and you need to be conscious of every step ahead. Some business structures also need licenses and permits, and you can check them at the site of the U.S. Small Business Administration.
Choosing a legal business name also comes under this stage. It will be easy if you have already found a name during the brand identity phase.
8. Find clients
Client search might sound intimidating to you, and so we suggest having a sales plan in advance. You need to overcome lots of rejections and struggles while finding clients. In the initial stage, business entrepreneurs set unrealistic numbers and get disappointed later. So, we recommend you to be realistic and enjoy every deal you crack. Don’t worry; you will grow and expand; the beginning is just rough.
To have a steady flow of clients approaching you, you need to have a marketing plan in place. Spend quality time and brainstorming in formulating a sales and marketing plan. It is advisable you don’t spend excessively on marketing activities; try to get it free or at nominal costs. Share your work, be active on social media, spread the word, get in touch with your target audience. You never know who will become your client. It is just about building relationships with people first, and then they become your good clients.
Briefly, we have walked through the detailed process of starting a consulting business, and we are sure you find it valuable.