8 Tips for Building & Sustaining a Thriving Consultancy Practice

The ease of delivering work remotely and the opportunity to control the type and amount of work you do are key trends that have made Independent Consulting (IC) an increasingly popular career choice.

Each consulting practice is uniquely defined by experience, specialisations and clients served, but all consultants share the challenge of building and sustaining a thriving practice. To help both new and experienced consultants succeed, I’ve tried to address the common challenges of managing projects, negotiating contracts and creating an environment for ongoing work. I’ve been working in the independent consulting industry for more than three decades. I hope you can take advantage of this time-tested advice to build your independent consulting practice with confidence:

1.    Too high, too low, just right. One of the biggest challenges facing new consultants is setting their bill rate. There is a science as well as an art to setting a rate that is both profitable and competitive. The science requires an understanding that profit margins, expenses and even insurance costs all contribute to your billable rate. The art is consideration of the market value of your skills, the economic climate, and the value of your competition. You may wish to consider using a bill rate calculator online. We recently built one for our company that tries to simplify the complex questions into a results-based tool.

2.    Specific focus, wide reaching results. Many new consultants try to do it all, eagerly going after any piece of new business that they can reasonably handle. Maintain focus on your core expertise and avoid the distractions inherent in veering off course. Clients are savvy and want experts for a particular purpose or skill set. Be specific in your focus and clients will have the confidence that you have what they need and will provide them with dedicated attention.

3.    Develop and nurture a strong network. Most successful consultants receive the majority of work from their trusted network. It is essential to create an environment that provides you with an ongoing flow of opportunities. Attend networking events, utilise blogging and social media, or create an email newsletter to keep your network up to date. There are many ways to build and nurture a strong network, but the key is to be active.

4.    Key Clauses to Negotiate. As an independent consultant you will be faced with reviewing, negotiating and signing contracts. The following clauses should be carefully reviewed with an intent to negotiate them out of the contract or at least limit how they are used.

  • Non-Compete. Limits your ability to do work in the future by prohibiting you from going after certain business. 
  • Indemnity. Indemnity clauses can be broad and put you in the position of being an insurance company for your client.
  • Warranty. Warranties are appropriate for a physical product where fault is easy to determine but messy for knowledge workers. 

5.    Start your projects with clarity. It is important to set clear expectations up front. Clearly articulate your statement of work, rate and outline expectations for both you and your client. Maintain clarity ongoing by issuing updates on project milestones, and key decisions that affect project assumptions like changes to rate or scope.

6.    Avoid multiple, simultaneous projects. It is not uncommon for other areas to crop up while working on a project. Maintain focus on your defined scope of work and address the additional areas after completion of your original project. Too many projects at one time can lead to confusion.

7.    Create a pipeline of opportunity. Once you have completed your deliverables on a project, prepare a list of tasks that still need to be done (see #6). You can obtain future work by presenting these details to your client in an organised way.  You can even begin discussing opportunities for additional work 3-4 weeks prior to the end of your contract.

8.    Build equity in yourself.  As a consultant your reputation is your most valuable asset. Delivering high integrity and good work is the best insurance you can have to protect that asset.