According to the U.S. Business Administration, 28.8 million people own a business. And if you want to join the ranks of the self-employed, learning how to start a consulting business is a great option. You can use the talents you already have or get a degree to develop new skills.
Either way, learning how to start a consulting business is one option you should definitely look at if you want to go into business for yourself.
What is a Consulting Business?
Before you learn how to start a consulting business, you should understand the roles consultants play. Basically, a consultant is someone who gives advice based on their extensive knowledge of a subject. Consultants advise businesses that need help with things like finances or marketing. They also act as consultants to individuals who need help with their diets, personal finance, or job hunting.
In other words, when you learn how to start a consulting business, you will act as an expert guide to business owners or individuals and help them understand situations and show them how to navigate them.
3 Categories of Consultants
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The term ‘consultant’ is broad and covers many areas. That’s why when learning how to start a consulting business you need to have a clear understanding of what type of consultant you want to be.
Here are the three of the most common types of consultants along with the consultant specialties that fall under each one.
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When you think of a consultant, you probably imagine a management consultant. These specialists help businesses with things like solving problems, planning strategic growth, and finding solutions to complex problems or issues.
There are several basic specialties management consultants work in.
Come up with a strategy
When a company wants to hire someone to analyze their workflow procedures, operational structure, or anything else that requires an in-depth look at their internal processes, a strategy consultant is who they hire.
Working as a strategy consultant will help you solve complex problems for business owners who don’t want to hire a full-time expert.
If you have a keen eye for the big picture, you should think about working as an operations consultant when learning how to start a consulting business. These consultants work to improve operations within a business so that they are more streamlined and cost-effective.
If tech is your thing, learning how to start a consulting business as a tech expert might be for you. These consultants work with companies and act as their technology specialist. They do this in two ways. First, they can evaluate a business’ existing technology platform. Then, they make recommendations about replacing it or updating it. They then act to help install any new tech or oversee the changes if they recommend an update.
Help with humans
Many of today’s companies outsource their Human Resources (HR) tasks to HR consultants. These consultants seek out new talent, hire employees, train, and assess them. They also manage the leadership of the company and focus on creating a company culture that encourages satisfaction and productivity.
An HR consultant also ensures that the business stays current with employment and labor laws and regulations.
Reduce those risks
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A risk and compliance consultant acts as the key contact for the client and works to analyze a client’s vulnerability and then recommends steps to remediate those weaknesses in compliance. They do this by analyzing the client’s review policy, network architectures, and processes documentation. Then they suggest tech solutions to help remediate the risks.
Working as a risk and compliance consultant means you need the skills to prepare and present reports to all levels of management.
Where’s the money?
If you have a head for numbers, learning how to start a consulting business in the financial sector would be a great move. These types of consultants work with companies to align their finances with their goals. For instance, a financial consultant may work with companies to plan their investments. They also work with them and help with taxes and insurance. As a financial consultant, you will study market trends, stock values, and other economic factors to make your recommendations.
Financial consultants need to have a license to practice their trade.
It’s so taxing
If you love the idea of consulting about tax issues, you can specialize in this type of consultation when learning how to start a consulting business. Tax consultants are experts in the area of taxation and help businesses prepare for tax season. They also help file taxes during tax season, and then work after tax season is over in the event that the IRS sends the client an audit letter.
2. Corporate consultants
Similar to management consultants, a corporate consultant specializes in working with large corporations in many of the same areas that management consultants do. The difference is that these consultants work with large corporations. Some corporate consultants set up an in-house organization in a client’s office to make themselves more available.
In addition to all of the consultant types listed in the management consultant specialty areas, here are a few additional areas of expertise filled by corporate consultants.
It’s all about the earth
Do you have a love for the environment? If so, learning how to start a consulting business as an environmental specialist could be the right career move for you. If you work in this field, you will help corporations analyze the impact a proposed activity will have on the environment. For example, if a corporation wanted to build a large structure near a wetlands area, you will help ensure that the building project stays in compliance with all the environmental regulations and laws.
Environmental consultants not only work with large corporations. They also work for the government when it needs an expert to help them stay in compliance on a large project.
Get the word out
Marketing consultants help corporations establish and maintain their marketing channels. Some consultants are broad-focused and work with all marketing channels, while others specialize in just one. For example, some marketing consultants only work to help improve a company’s SEO and internet marketing platform.
These consultants help corporations attract new customers and then convert them from a shopper to a buyer. They also help retain a corporation’s existing clientele. Marketing consultants also work to help a corporation establish and maintain their brand.
Some marketing consultants go on to open a marketing agency, where they hire other talented consultants to act as a team.
The heart of the organization
When working as a healthcare consultant, you will act as a management consultant who has significant expertise in the healthcare industry. Working in this capacity, you will work with large corporations that have complex systems in place that you need to understand.
As a healthcare consultant, your role is to analyze the business structure of the healthcare organization. That includes looking at all elements of it, such as the workflow procedures and growth strategy. Then, you will make recommendations about how to improve processes and increase productivity and efficiency.
Make it viral
Even though social media has been around for some time now, many large corporations aren’t sure how to effectively use it to enhance their business. That’s why they hire .
Acting in this capacity, you will teach the corporation how to use social media to grow their brand effectively. You will also work to pinpoint their audience, develop a strategy to reach them, and then create objectives that you measure to help you understand whether or not the strategy is effective. Sometimes you will manage the social media campaigns you create.
It’s all how you look
An image consultant understands that to be successful in business, you have to look the part. Image consultants help establish business people’s dress by focusing on their dress, grooming, and behavioral patterns.
You can coach clients online, but for wealthier clients, you will probably travel to their homes and coach them in person.
3. Individual consultants
Finally, some consultants work with individuals. These consultants use their skills in unconventional areas to help clients learn and adopt certain lifestyle behaviors.
For example, you could work as a fitness consultant who helps develop and outline customized diets and exercise programs for your clients. You could also work as a personal finance consultant or a consultant who helps prepare parents for a new child. You may also work as a consultant that helps people get their house ready to sell or open a small business.
The possibilities are endless when wanting to know how to open a consulting business for individuals. Think about your skill sets and determine whether or not people would pay you to teach it to them.
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How Much Can You Make as a Consultant?
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According to Payscale.com, consultants earn a wide range of fees depending on their level of expertise and which type of consultant they are. The median hourly rate for consultants is $76.30, but fees range from $24.92 to $193.92. That means a consultant’s annual salary can be anywhere from $35,759 to $314.093.
How to Start a Consulting Business: A 4-Step Plan
Now that you understand your options, let’s talk about how to start a consulting business. Every consultant will take a different path, depending on which type of consultant they want to become.
Here are the four general steps you’ll need to follow when thinking about how to open a consulting business.
1. Credential up
Some consultants need to go to school and get a degree to consult in their field. Financial consultants are a great example of this. Others can rely on personal experience and knowledge to open a consultant business.
For example, if you want to start a consulting business that teaches people how to restore old furniture, you won’t need a degree or any specialized training. You will use the knowledge you already have.
On the other hand, if you decide to open a corporate social media consulting business, you should have a relevant degree and years of experience to back it up.
Your first step in the process is to determine whether you need a degree to open your consulting business. If you do, make plans to start school and get the required credentials you need. Also, if you already have a degree but no experience, you may need to work as a consultant for another firm until you get some experience under your belt. After all, people will pay you for your knowledge and experience, and you need both to sell yourself effectively.
2. What’s in it for me?
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Your next step in the process is to create a compelling value proposition for your consulting firm. A value proposition is what you can offer your clients that help them get from their current state to their desired one.
For example, imagine that your goal is to become an individual consultant who offers pet training services for difficult-to-train pets. Your clients are people who have unsuccessfully tried to train their pets.
Now, imagine that you include specialized knowledge into the emotional lives of animals as your value proposition. This specialized knowledge would help your clients train their pets more effectively.
This is an example of a value proposition. It is the thing you offer that will help your clients achieve their goal. To find it, think about what goal your clients most want and then decide how you will help them reach it.
3. Figure out who they are
The most successful consultants offer their service to a niche group of people. Sure, you can become a general consultant like a life coach. But if you do, you will likely lose a lot of your business to niche consultants.
Here’s how that works:
A life coach is excellent at guiding people in a general sort of way. They can increase a person’s motivation, steer them in a general direction, and be there to talk when the client needs it. But even people who hire life coaches have a goal in mind. Maybe it’s to get more energy, to lose weight, to overcome the fear of opening a business, or any number of other things.
That’s where niche consulting comes in. If the person who wanted to get more energy had the choice between hiring a lifestyle consultant to help them or a consultant who specialized in motivation and drive, who do you think they would hire?
They always hire a specialist.
And that’s why you should narrow down your focus and become a niche consultant.
4. Get the word out
Too many people who want to learn how to start a consulting business will end up in the feast or famine lifestyle. Things are great when the money is rolling in, but they inevitably hit a famine period when they hope the next client calls.
That’s no way to do business.
The answer is to develop a proven system that consistently brings in clients to your consulting business. Most people who are successful at running a consulting business operate what’s called a funnel system. It is designed to convert people who are interested in your consulting services to becoming clients.
Here is a brief breakdown of how some funnels work:
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Run a Facebook ad to get the attention of people in your niche. Facebook allows you to target your audience in detail, so you know that only people who are interested in your niche services will see the ad and click on it.
But where do they go when they click?
As soon as someone clicks on your Facebook ad, they are taken directly to your landing page. There, they will find an offer that gives them something for free in exchange for their email address. For instance, if you offer niche consulting services for people who want to start a business, you can give them a short video that provides some training that will help them meet their goal.
Now that you have their email address, your next step is to show them the video you promised. The video should contain enough information to convince the viewer that you are an expert. At the end of the video, offer them a free 30-minute consultation with you.
Pencil them in
After they watch the video and want to schedule the free consultation, you should send them to your calendar. You can use free software like Calendly to make it easy to schedule their free consultation.
Before you allow them to pencil in their time, ask them to complete a quick survey that will show you if they are someone you want to work with. Some people just want something for free, and those aren’t the types of clients you’re after.
Now, it’s time for the phone call, when hopefully, you will turn the person into your client. Use the time to ask them questions and truly understand their situation before offering any advice. Remember, they have a pain point, and they need someone to help them overcome it. Use the call to convince them that you are the right person for the job.
Did You Learn How to Start a Consulting Business?
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When entering the consulting business, you will find all kinds of possibilities and opportunities. But if you’re going to start this type of business, you need knowledge. We hope you learned how to start a consulting business and are motivated enough to begin the process of opening yours.
Have you already started a consulting business? If so, we would love to hear about your experiences in the comments below!
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