By Daniel E. Craig, Founder, Reknown
People often approach me looking for advice on becoming a consultant, and my first impulse is to cry, “Don’t give up your day job!”
Self-employment is not for the faint of heart or the needy. Many people get a dose of the spotty income and solitude, and run screaming back to a real job.
But if you’re self-motivated and content with your own company, the life of an independent consultant can offer tremendous flexibility and lucrative opportunities.
Having survived and thrived as a consultant for almost ten years, I’ve learned a few ins and outs. Here’s a summary of my top recommendations.
Do you have what it takes? Really?
Be aware that calling yourself a consultant can raise eyebrows. The consulting profession has a rather sketchy reputation because virtually anyone can claim to be a consultant. The title is often used as a euphemism for unemployed.
As a qualified consultant, you should have extensive experience and expertise in a given field. Companies or individuals must be willing to pay for your advice, analysis and problem solving, and you should be able to help them improve their business.
Excellent communication skills are critical too. You will need to convey information and ideas clearly and credibly, in writing, in visuals, and in front of groups.
Creating a clever name and a slick website can be fun, but at the outset your priority should be finding paid work. Besides, your services are likely to evolve over time.
When I started out I used my name as my business and built a simple web page. A few years later, after I had established a viable business, I created my company name, Reknown, and invested in a more elaborate (but still simple) website.
If possible, keep your day job until you have lined up enough work to pay the bills for six months or more. That means securing solid commitments and contracts. Those clients who promised to follow you when you break out on your own have a way of disappearing.
Produce quality content
It’s a classic scenario: you set up shop and then sit back, waiting for the phone to ring. It doesn’t. If you want work, you will need to source it, find the right contacts, and ask for it.
But there is a workaround. I built my business through content marketing. I write articles on topics of my expertise and publish them on my blog or submit them to trade publications, many of which are starving for good (free) content. Then I sit back and let SEO and social media work their magic.
Find your medium, whether it’s articles, blog posts, videos or podcasts, and produce high quality, timely, relevant content. Eventually the leads will roll in.
Prioritize large projects and long-term relationships
Any consultant will tell you that landing and executing small, short-term projects can take as much time and effort as large, long-term contracts. Focus on securing big contracts to form a base for your business, and use smaller projects to fill the gaps.
I have had the same handful of clients for over five years, and I don’t have to write detailed proposals or prove my worth to them. I simply do what they ask, do it well, on time and on budget, and the work keeps flowing.
Know when to invest a lot of time in proposals
Some people will make you jump through hoops to secure their business, and then they will go dark, without even the courtesy of informing you they have moved in another direction. It’s poor etiquette, but it’s a reality of business.
Save yourself the outrage, the withering retorts you will never send, the plotting for revenge, and assume you will receive no response after submitting a proposal. That way you will be pleasantly surprised when you do.
I stopped putting a lot of effort into proposals a long time ago. I’ve learned to sniff out the time-wasters, the spineless, the people fishing for free information. I send them an email summarizing my services, quote my highest fees, and move on.
Don’t undervalue your services
As a consultant, you can bill for only so many hours per day and will work many hours that you can’t bill for. You have to pay the costs of running your business, and companies will save money by outsourcing to you rather than hiring a full-time employee. So don’t be shy about charging your worth.
If you’re not sure how much to charge, start with a good annual salary for an executive in your field of work, divide the amount by 2080 (52 weeks at 40 hours), and add 25%. That should give you a reasonable hourly fee to quote.
Personally, I increase and decrease my fees according to how much I want or need the work. It’s called dynamic pricing, and lots of businesses do it.
When quoting for a project, provide a total fee, a breakdown of estimated hours, and the hourly fee to ensure there are no misunderstandings. Ask new clients to sign an agreement and provide an advance deposit of 25 to 50 percent of fees, and then bill monthly for work performed.
If you’re invited to speak at a conference, inquire about a speaking fee and travel expenses. Preparing a presentation takes a lot of time, and you’re sharing your expertise. As an independent you don’t have the luxury of your company paying your way, and it’s a safe assumption that you won’t get new clients out of the gig.
Treat every client like they’re the only one
Clients are like lovers. They know you’re probably seeing other people, but they don’t want to hear about them. Treat every client like they’re the only one. If you can’t make a requested meeting or deadline, propose an alternative, but there’s no need to say why.
One exception: When prospective clients are dawdling over a proposal, feel free to nudge them into a commitment by mentioning that other suitors are lined up.
The advantage of working for yourself is you can pick and choose your relationships. When you love your clients, everything else is easier. Align with people who share your values and recognize your worth.
Business is never as bad as it seems or as good as it seems
Be prepared for major ups and downs. When business is slow, the fear and self-doubt can be crushing. Keep busy by creating work that adds value to your business. Go for coffee with other freelancers who can commiserate and provide encouragement.
When you feel isolated or lonely, take your laptop to a café or shared workspace.
When the work is rolling in, resist the urge to hire three assistants, a COO and a publicist. Business tends to ebb and flow, and chances are you’ll soon be back to wondering how you’ll pay the rent.
Instead, keep overhead as low as possible, and maintain a network of trusted freelancers to subcontract to. Personally, I hoard my work, working day and night through the busy times, knowing they won’t last.
Social networking, or socializing, not working?
Social media can be helpful for keeping up on industry news and connecting with others, but I find most activity to be superficial, fleeting, and distracting from meaningful work. Maintain a presence, but know when to shut things down and get to work.
When Woody Allen said that 80 percent of life is showing up, he didn’t mean to a Twitter chat. Remove your pajamas, drag a comb through your hair, and show up at industry events. Invite people out for coffee or drink, or ask to drop by their office to say hello.
Nothing is more effective than face-to-face contact for finding opportunities, understanding what’s happening in the field, and building relationships. I learn more from a one-hour lunch with a colleague than from hours of skimming news online.
As a self-employed person, you have a responsibility to flaunt your freedom on behalf of all nine-to-fivers who can’t. Go for a run or yoga session in mid-day. Bring your laptop to the park. Extend your vacation by another week, and do your work by the pool.
Find out your most productive time and block it off for your most important work. Schedule meetings, invoicing and administrative work outside of these hours. When you’re on a roll, keep rolling. When things aren’t flowing, take a break.
I get some of my best writing done on weekend mornings. Then I don’t feel so guilty when I can’t get going on Monday morning.
Last, remember that your knowledge is your equity. Don’t let it go stale. Set aside time every day to keep up on the latest trends, technology and best practices.
That way no one will ever question your credibility as a consultant.