How to Become a Consultant

People between jobs often say they're business consulting, which is a cool thing to say. So cool, in fact, that maybe you might want to learn how to become a consultant.

Name anything that needs doing, and there's a consulting profession for it. Search to find consultants on inks and dyes. Scan for consultants on golf accidents. Enter "consultant" into a search engine and you'll see names of lactation consultants.

There are zillions of business models for consultants, but let's narrow them down to three for now: Joining a consulting firm, contracting either as an independent or through a temp agency and freelancing.

Looks at Consulting Firms
Non-accountants who work for a Big Four (formerly the Big Five, Big Six and Big Eight) firm, or for management consulting firms such as McKinsey and Bain, are generally called consultants unless they're space planners or secretaries or librarians or whatever. They're not consultants in the freelance sense. They work for salaries and get benefits.

The best way to get into a big firm is to have graduated from college or business school less than a year ago. Consulting firms like to grow their own. Small consulting services firms abound, but be wary: Many of them were started because their founders didn't play well with others.

Consulting-firm ranks are heavy on computer skills and people who understand "management." This means that a company that wants to restructure or right-size, or whatever it prefers to call it, often hires a consulting firm to run the layoff. Then the consultants disappear, and management can blame them for the awful way it came out.

You can also get into a consulting firm if you have specialized expertise. For instance, if you came from Enron, you could try to sell yourself as a consultant on energy trading. It probably wouldn't work though, since much of Enron's management came from consulting firms.

Back in the eighties, when downsizing was hot, company layoffs affected thousands of people and then management suddenly noticed that no one was left to do the work. Solution: Hire the ex-employees back as consultants, or contractors.

This worked beautifully for the companies since they didn't have to give paid vacations, pay benefits, withhold taxes or worry about wrongful discharge suits. It worked out okay for the consultants, who preferred it to unemployment. It didn't work for the IRS, which wasn't getting its withholding-tax payments. The IRS issued a lot of rules on who could be a contractor. They had to work for other people, use their own equipment and generally be distinguished from regular employees.

What were companies to do? Nature abhors a vacuum, and to their rescue came the above-mentioned staffing firms. They hired the contractors as employees-which they were often able to do without giving vacations or paying benefits, as long as those withholding payments went out on time-and leased them to the companies. Sometimes they'd lease a whole technical writing or customer service or advertising department. On the company side, this was called outsourcing.

Many people enjoy the independence of contracting. They often set themselves up as staffing firms. They like running their own businesses and the ability to pick and choose clients. They pick up several tax benefits in addition to healthy hourly rates. If there's work for them, that is. Offshoring-outsourcing overseas-is hitting contractors hard.

The hardest but most fun way to start a consulting career is to hang out your own shingle. To make a living that way, you need knowledge or skills that people want. That's not much of a problem if you know how to present it. Whatever you've done for a living, someone may pay you to do it as an independent. If you're a writer, for example, you can find jobs writing business plans, brochures and magazine articles, plus doing market research on new products and tracking magazine advertisements.

The hard part is that you may have to spend more time marketing yourself, at least in the beginning, than you do consulting. You'll also spend a lot of time getting copies made and packages mailed, since you probably won't be able to hire administrative help for a while. If you have a day job, don't quit it to become a consultant.

Your best clients at first are likely to be small businesses, which can't afford to hire a whole person to do what you do, and other consultants who need stringers to help them over busy periods. You meet them at small-business networking groups or through people you know, and once in a while they advertise. Consulting for a consultant is also a good way to screen the consulting firm they work for.

Consulting can be fun if you're willing to live with insecurity. It's a good way to generate activity and income between jobs. If it works, you may have an exciting new career.

Article provided by Homesteader

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