Consultant 
by Dr.Valerie Young, © 1996

According to Entrepreneur magazine, consulting is one of the hottest businesses going. Whether you've been pushed out of the corporate world or, like me, voluntarily opted out; consulting may offer you the flexibility you've been dreaming of. Before hanging out your shingle though, you'll need to consider these questions.

1. Do you have expertise others are willing to pay for? Management-oriented consultants help organizations with strategic, technical or operational planning. Hands-on consultants train or teach specific tasks such as using a computer, running a business, or career planning. If you have specialized knowledge or skills which people are willing to pay for, you'll need to find a niche in which to market them. This leads to the next question.

2. How do you feel about selling? If you're already saying, "Wait a minute, I want to be a consultant, not a sales person," think again. As a consultant, you need to be prepared to sell a valuable product; yourself! Even with referrals, establishing and maintaining a consulting practice is a constant process of self-marketing.

3. How comfortable are you with financial uncertainty? There are a lot of benefits to being an independent consultant, but financial security is not one of them. Experts advise you have six month's to a year's worth of income in the bank to cover yourself while you are launching a full-time practice.

On the other hand, most people are drawn to the field not only for the opportunity to be their own boss, but for consulting sky's-the-limit earning potential. To figure out how much to charge for your services, start by determining your current daily rate as an employee. Since consultants are only paid for the time spent on a client's project, you must build into your fees enough money to cover overhead, the time you invest in marketing, taking care of administrative tasks like billing, and so on, as well as your own time off. Finally, unlike employees who are paid for a five-day work week, consultants should anticipate slow periods. These usually come during the holiday season, anytime there's a three-day holiday weekend and during the traditional vacation months of July and August.

For more information on how to determine the market value for your services, establish daily or per-project rates, calculate your overhead, negotiate the contract and more, check out Howard Shenson's The Contract & Fee-Setting Guide for Consultants and Professionals. Getting paid for your expertise; and doing it on your own terms; is a great way to make a living. If you have the skills and temperament to run your own consulting practice, and are willing to do your homework up-front, you are well positioned to succeed in this potentially satisfying and lucrative form of self-employment. .

Valerie Young publishes Changing Course, a bimonthly newsletter for people who want to ditch the 9-5 grind and work at something they love.