Starting a Home-Based Consulting Business

Consultants work in nearly every field imaginable. Businesses, organizations, government agencies, and even individuals call in a consultant when they need additional expertise in a particular area. Consultants may be called in for hours, days, or even longer, or may work on a retainer as needed. The particular arrangements depend on the needs of the client.

Successful consultants typically have an area of particular expertise and a passion for excellence. This combination makes the consultant valuable to a client.

Getting Started

Consultants share their own expertise with clients. The first step in starting a consulting business then is to determine what are your particular strengths, skills, and areas of interest and expertise. In other words, what can you offer to potential clients that will be valuable to them and that few others can offer?

Many consultants are able to make their former employer their first customer. Employers are often reluctant to lose valuable employees who have specialized knowledge. The new consultant is sometimes able to reach an agreement where they will continue on for a time as a consultant. This offers the advantage of immediate cash income, a client to list on your portfolio, and a chance to line up additional paying clients.

Consultants frequently run their consulting business as a home-based business. Self-employed consultants who do not have employees can easily run their consulting business from home. Since work is typically done at a client's place of business, over the telephone or even online, this business is well suited to being operated as a home-based business.

Marketing

The first step in marketing your new consulting business is to determine your target market. Once you have identified the unique skills and knowledge that you have to offer to a client it is necessary to identify potential clients. For example, if your expertise is in health care administration then you probably will not bother marketing your consulting services to auto parts retailers. Defining your potential customers in light of what you plan to consult about is the first step in successfully marketing a consulting business.

Preparing to market your new consulting business is also a crucial step to success. Before you start calling potential customers it may be wise to have a phone number, business cards, brochures, a business website and business e-mail all ready. Presenting a professional, organized image is essential if you want customers to hire you as a consultant.

Joining the local chamber of commerce, civic groups, or trade associations can provide networking opportunities with potential clients. Affiliate yourself (and your business) with organizations that are relevant to your area of consulting. Placing advertisements in relevant trade or industry publications can also bring in new business.

Direct marketing to target businesses can also be effective. Calling or mailing brochures and introductory letters to target businesses can open the door to a consulting contract. Cold calling does take "thick skin" but can yield results with persistence.

Cautions

Work may be sporadic, particularly when starting out as a new consultant. Consultants who have built a solid reputation in their industry may find themselves booked well in advance though.

Develop a system to track billable hours and work performed for all clients. Keeping up-to-date, accurate records can avoid confusion about billings, and can be vital in the event of a dispute about the amount of an invoice.

Business insurance like an errors and omissions policy may be a business saver if not a life saver should a client ever sue you over the advice or counsel that you provided. These policies, similar to policies carried by attorneys and other professionals, protect against damages when your advice (or lack of advice) goes very wrong. Talk to a qualified insurance agent about any business insurance questions.

Conclusion

People who possess expertise in a valuable area, are committed to excellence, and who enjoy variety and challenges may find the consulting business to be a rewarding and profitable business opportunity. A consulting business is well suited to operating as a home-based business. This business can also be started with very little capital up front.

SOURCES

How to Start a Consulting Business. Entrepreneur.com. Site accessed on 21 November 2010.

J.W. McCord. A step-by-step plan to starting a consulting business. Tech Republic. Site accessed on 21 November 2010.

Tim Berry. 4 Tips for Starting Your Consulting Business. US News. Site accesses on 21 November 2010.