Consulting is a big--and growing--business.
The market for consulting services is estimated to be between $130B and $150B annually, and professional consultants are among the highest paid workers, earning more than many doctors, lawyers and other professionals.
It’s not surprising that consulting is attractive to many people who want to launch a business. After all, if you have a saleable skill, it’s an easy business to enter. No one will stop you from calling yourself a consultant and startup can cost as little as printing business cards and getting a business license.
On the flip side of the coin, consulting is fiercely competitive. Just ten firms own almost 40% of the consulting market share in North America alone, and they fight for every opportunity to grow.
Today, clients have instant access to legions of experts at the click of a mouse, and they have found low-cost, offshore alternatives for many consulting projects.
The beauty of this market, though, is that many of the large, lumbering consulting firms focus on thin slices of the market. That creates an opportunity for smaller firms and individual consultants who know how to use guerrilla methods to snag their share of profitable business.
So how do you break into consulting?
Think about Your Fourth Client First
As a new consultant, you should be able to generate a project--or maybe several--through your networks of friends, past employers, and colleagues. After all, research shows that clients use their networks to select consultants more than any other method, and they, no doubt, know someone who knows you.
Unfortunately, your address book alone won’t sustain your consulting business long term. If your goal is to build a sustainable consulting practice, the real question isn’t how to get your first client, but how to create a business that will attract the second, third, and fourth clients to your practice.
Before you ask your contacts--or anyone else--to hire you as a consultant for that first project, ensure your success by taking a longer view of your business. Work hard to land that first client, but also put the marketing and consulting fundamentals in place that will secure your future as a consultant.
Start with these four simple tips:
- Know exactly what to say--in one minute or less--to prove you are the best consultant a client can find.
- Create a marketing strategy that emphasizes action over planning.
- Become a master of the consulting process, not just a subject-matter expert.
- Win with value and results, not price.
Have Something to Say…
Prospective clients rarely look for consultants until they have a pressing need. In other words, “we just can’t do it ourselves; let’s get outside help fast.” A recent client admitted that his team had been spinning its wheels trying to resolve a complex transportation problem for three years before they hired consultants and gave them four weeks to come up with a solution. They did.
The point is that, when most clients are in the market for help, they want it yesterday. And they want the best consultants they can find, at an affordable price. So, take the time to define what makes you the best consultant a client can find.
Many consultants mistakenly believe that by defining their expertise broadly, they’ll appeal to a wider audience and land more clients. The less specific you are, the less likely it is clients will think of you when they need help.
Why would clients turn to you for their most important projects? Be prepared to answer these questions during your first conversation with them:
- What, exactly, are you offering? Is it strategy development, financial management, operations improvement, sales and marketing advice, technology development, change management assistance, or something else?
- Why is it needed? What specific business problem or opportunity will your services address?
- How will the client be better off after having worked with you?
- What’s really different about your firm, its services, results or approach?
- What quantifiable benefits and results can your client expect?
If you can’t articulate the answers in a minute or less, keep working. You may only have that one minute to make a first impression on a client, so make it count.
And Someone to Say It to
The market has no shortage of prospective clients, but truly profitable projects can be few and far between. If you want to work for the most profitable clients, you'll have to compete for and grab their attention. And for that you must have a plan. A real one.
Many veteran consultants haven't looked at their marketing plans since they were first created. As a result, they drift from project to project, getting by on meager profit margins. Guerrilla consultants, however, leave the low-profit projects for others and focus on attracting and keeping the clients that give them the opportunity for financial and professional growth.
Guerrillas begin that process by creating a one-page marketing plan that lays out how to get and hold onto profitable clients.
Forget the reams of fancy charts, detailed analyses and bullet-proof competitive intelligence. You can draft your first marketing plan in seven sentences:
- Sentence one explains the purpose of your marketing.
- Sentence two explains how you achieve that purpose by describing the substantive benefits
- you provide to clients
- Sentence three describes your target market(s).
- Sentence four describes your niche.
- Sentence five outlines the marketing weapons you will use.
- Sentence six reveals the identity of your business.
- Sentence seven provides your marketing budget.
As you create your marketing plan, remember this: you are building a platform from which to consistently communicate your ideas to prospective clients. That's the fastest way to launch a new practice because prospective clients equate the success of a firm with consistent visibility.
So create a marketing plan that maximizes your visibility in the market. Over time, keep your business networks healthy with constant attention; establish a credible Web presence; speak for industry and trade groups; participate in studies and surveys; publish articles; and make contributions to your targeted industry association and local business community.
And, most importantly, once you begin your marketing program, never stop. You'll reap the benefits for the long haul if you stick to your marketing guns.
When a Client Asks What Time It Is, Don’t Take His Watch
Perhaps the most serious challenge facing consultants is client skepticism. In a study by business analysis firm Ross McManus, only 35% of clients are satisfied with their consultants.
Part of the problem is that many consultants are deep subject-matter experts, but less familiar with the consulting process. Before you get too far into the business, get a firm grasp of the fundamentals of consulting, including how to:
- Qualify each project to determine your ability to win the work and earn a profit. These two don’t always go hand-in-hand.
- Scope projects so you and the client know what work will be done and the anticipated results. Your profit can evaporate if you have an ambiguous statement of the project scope.
- Find the pricing strategy that’s fair to clients and protects your bottom line. Pricing services is as much an art as a science, and there are at least fifteen different pricing strategies you can use.
- Prepare proposals that make the most of this time-consuming activity. Make sure you’re talking to the decision-maker and that the project has funding.
- Deliver flawless work and communicate effectively with your client.
Do those five things well and you’ll have more client work than you can handle.
If you’re new to the business, interview consultants on how they handle these aspects of the business; read books, articles and reports by leading thinkers in the field; and consider joining one of the many professional associations for consultants. You can save years of learning things the hard way.
The End is the Beginning
Your clearest path to a new client is your network of former employers and others who can make introductions to get that first project kicked off. Keep in mind, though, that consulting begins and ends with results.
To succeed, you must offer and deliver undisputed value to your clients and everyone else in your network. Value is also the foundation on which you must build your marketing. Your network of colleagues won’t support you, or your business, if your value is questioned anywhere along the way.
So, before you launch your practice, give these ideas some thought. They’ll help put you on the road to long-term success.