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Tips on how to Begin a Consulting Firm: three Steps to Discovering Your Thought

22, 2021

6 min read

The opinions expressed by the entrepreneur's contributors are their own.

Do you want to start a consulting company but are not sure where to start?

With so many options, it can be difficult to pinpoint exactly which service to offer to which audience. You may have heard the phrase "the wealth is in the niches" but you also don't want to miss the opportunity to generate income from someone who is willing to pay you. But think about it like this. If you are looking for a business development consultant, would you like to work with someone who also mentioned their expertise in travel and home decor, lawn maintenance and cryptocurrency investing?

While it can be tempting to cast a wide net, any "and" you add to your service or audience description cuts the impact in half. As with any business, your services will evolve over time. However, here is a three step process to get you started.

Related topics: Learn how to package, rate and advertise your consulting services.

Step 1: do a self-inventory

Lack of trust will make your business stronger before you even get started. So let's make it clear which services you can safely offer based on your previous experience and areas of interest.

Open a spreadsheet and write down all of the job roles you've had in one column, including volunteering or organizations you belong to. In a second column, write down any associated responsibilities, tools, and processes associated with roles. You can probably remove most of this information from your resume or LinkedIn profile.

Then determine which activities you want to offer as a service. And make sure that you actually enjoy this type of work. There is no point in drafting a business proposal that makes you bored or unhappy. Although you want to close a niche at some point, it's okay to be a little wider here. It's hard to know which services are the most lucrative and fulfilling until you have experience promoting or delivering services that weren't as effective.

In some cases, you may want to offer services that you are new to. This is completely right. All you need to do is make a list of the training needed to confidently present yourself as an expert.

Step 2: determine the industries you want to work with

Understanding your audience will help you make better use of your service offering and prepare for the research you want to do. Choose industries based on your previous experience and / or personal interests.

And you should also be aware that each industry has its own advantages and disadvantages. Government contracts can be extremely lucrative but require a long and drawn-out administrative process. At some point I almost gave up on receiving payments from a government project because it took me longer to fill out all of the forms than it did to deliver the actual project. My wife turned down this idea, but I gave it a lot of thought after I was told that I need to fax additional information to Compliance instead of emailing it.

Small businesses, on the other hand, can give you the opportunity to have a huge impact on individuals, but they may not have the budget you seek based on their earnings. In this case, you may want to consider an option of revenue sharing in addition to a flat fee, or you may just need to step away from the opportunity.

You will be paid proportionally to the difficulty of the problem you are solving. So if you want to increase your sales, choose an industry with more difficult and expensive problems. But I can imagine some of you seeking financial freedom and fulfillment. If so, choose industries that will reward you with more than just a paycheck.

Related Topics: How To Start A Consulting Firm: Determine Your Prices

Step 3: Research your problems and develop a solution

I know I just said it's not all about the money, but you still have to pay bills and support a lifestyle. Unfortunately, many consultants fail here. They create solutions to problems that either don't exist or are not effective enough to make a sufficient fee. You can avoid this danger by carefully researching your target audience's problems and the solutions they are looking for. Then create a service that solves these challenges based on the areas of expertise identified in Step 1.

If the process seems time consuming and tedious, your intuition is correct. Therefore, you need to really enjoy what you are doing and who you are doing it for. This will be challenging, but it doesn't have to be confusing. I gave step-by-step advice on how to create a compelling offer by interviewing your target audience on LinkedIn in the article "How to Create a Compelling Offer by Interviewing Your Audience on LinkedIn".

Plus, you don't have to start from scratch. Take a look at how other consultants present their services, then put your own spin on it. And I know any Marketing: 101 class will tell you to determine your unique differentiator, but trying to do can easily confuse you and your audience. Your service offering should be straightforward and concise, your personality is your unique differentiator. Ultimately, this is how you build your personal brand.

Related: 5 Questions Every Consultant Needs To Ask During A Sales Call

From planning to action

After completing this research, you may find that for one reason or another you are not interested in solving these issues. It's good! While it can be frustrating, it is better to do this job now so that in a few years time you won't be sitting around wondering why no one would want to pay for your services.

Just go back to step two and select a different audience. You may even have to go back to step 1 and decide to offer a different service. I know keeping the momentum going is tempting, but clarity is the precursor to trust. Once you are clear on what you want to do, it is safe to start building a brand and business that will reward you for years to come.

Ready to start your consulting business? Check out our Consulting Business Accelerator and get started today! You get access to training videos, hands-on activities, and weekly live Q&A calls.

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