APPENDIX: Setting Up a Consulting Business

Objectives:

To identify the requirements for setting up a consulting practice.

To understand the pitfalls of setting up a business.

To recognize the minimum requirements for a consulting business.

To identify the basics of private consulting.

WARNING: The road to financial independence in your own consulting business is a long and arduous one.

I. WHERE TO START

A. Determine exactly what to offer the world as an independent consultant.

1. Begin with your own personal development.

a. Develop a list of personal strengths.

b. Description of skills to offer others through a series of workshops or training programs.

2. Personal Strengths: Can you make it as a consultant?

a. Strong Self Concept

b. Highly Self-Motivated

c. Well Organized

d. Willing to work Long Hours!

e. Know about Small Business

(1) Financial Aspects

(2) Personal Allocation of Time and Energy

f. Sales

(1) Establish Contacts

(2) Sell the business

(3) Follow through with successful training program.

3. Assess What You Have to Offer: Skills others would be willing to pay for?

a. Find something within you background and/or training that makes you unique as a trainer.

b. Ph.D. for high credibility

c. Advanced Graduate Work

d. Five or more years as a successful trainer.

B. INVESTIGATE Financial Statement

1. Do you possess the financial assets necessary to begin private consulting?

2. Three months without income.

a. Establish contacts.

b. Set up consulting schedules.

c. Offer an initial round of training.

3. Have at least one year's salary, if not two, set aside to see you through the lean times.

C. Prepare a Short-term GOAL STATEMENT.

1. Do you want to consult on a full-time or part-time basis?

2. Are you willing to devote a lot of time to travel for you consulting practice?

3. Do you plan to train alone, do you want to work in a partnership, or as part of a larger team?

4. What sort of consulting business do you envision three to five years down the road?

II. HOW DO YOU FIND CLIENTS?

A. Start with people you know the best:

1. Neighbors

2. Colleagues

3. Religious/Civic Organizations

4. Half hour training session as a "freebie" to religious/civic organization.

B. Establish a Professional Network

1. Speech Communication Association

2. American Society for Training and Development (ASTD)

3. National Platform Association

4. National Speakers Association

5. Chamber of Commerce in your own community.

6. Local Convention Bureau.

C. Check Announcements in local newspapers for "requests for proposals."

1. Establish contacts with requesting agency.

2. Time consuming.

D. Cold Call / Letter where no Personal or Professional Contacts have been made.

1. Least Successful

2. Most Difficult

3. Professional Organizations

a. Court Reporters Association

b. Arizona Bar Association

c. American Management Association

d. Hotels/Motels

e. Miscellaneous Areas

(1) Parties

(2) public gatherings

E. After offering training programs...

1. Follow-up to determine long-range effectiveness of training.

2. Suggest other kinds of training.

3. Nothing will help your business more than a referral by a previous, motivated, and pleased client.

III. WHAT IS NEEDED BY WAY OF OFFICE AND EQUIPMENT?

A. Have just enough to make the business successful.

B. Begin with answering service if cannot afford to have an office and staff.

1. Leave a message with a human being.

2. Projects image of success - being a busy consultant.

C. Maintain some kind of office.

1. Do not constantly change address.

2. Do not constantly change phone number.

D. Equipment

1. Telephone

2. Computer

3. Video Recorder, Monitor, and Camera

4. Good copy machine

5. Audio Equipment

6. Overhead Projector

IV. WHAT IS NEEDED BY WAY OF MATERIALS?

A. Good business card coordinated with stationary.

B. Something unique that makes a good, strong, first impression.

C. Professional looking brochure (to advertise services).

D. Portfolio of programs and letters of response.

E. Personal assessment of finance.

F. Advertising

1. Local newspaper

2. Magazines

3. Television

4. Appearances on local television talk shows and local radio.

5. Brochures and special-interest fliers

6. TAKE ADVANTAGE OF THE MEDIA AT YOUR DISPOSAL!

V. HOW MUCH TO CHARGE?

A. Be competitive with other consultants in your marketplace.

B. Low : $100 - $200 per day

C. High : $5,000 - $10,000 per day

D. Look at charges paid to other professionals

1. Accountants

2. Lawyers

VI. PITFALLS AND POSITIVES

A. PITFALLS

1. Hard Work

2. Long Hours

3. Occasionally Boring

4. Being pulled in a variety of directions simply to survive.

5. Amount of Time spent Traveling

B. POSITIVES

1. Master of your own DESTINY!

2. Choose the kinds of CLIENTS and LOCATIONS that you want!

3. Travel can be THRILLING AND CHALLENGING!

VII. THE "BOTTOM LINE"

"If you've got a good idea, if you like to sell, if you know how to market, and if you have a financial basis from which to work for several months, then go out and take up private consulting and see how successful you can be. Might start with an internship or work for a consultant, and then move gradually into the world of private consulting."