Independent consultants in almost all industries earn billions of dollars annually. On average, the new consultants earn around $14,000 while the highly experienced ones make roughly $165,000. The money these consultants make would never come in without the independent consultant fees that they set. Money is a good motivation for workers in all professions and industries. Independent consultants are not different from all other groups of workers who want to earn a solid upkeep and meet their financial obligations.
Here are a few tips to help you set competitive and attractive independent consultant fees.
First, determine how you want clients to pay you. For the most part, your options would revolve around being paid per project or by the hour. Also, you may want to consider working on retainer. The choice you make from these multiple alternatives will go a long way into determining how smooth your operations are. In fact, the method of payment you eventually settle on determines how much cash flow your independent consultancy will have going forward. Therefore, choose wisely.
The amount you charge depends on where you fall. The highest earners in descending order are:
a) strategy consultants
b) operations management consultants
c) human resources consultants
d) IT consultants
It’s imperative that you study your competition well before settling on the appropriate fees to charge. However, the study won’t be a walk in the park because, as most people know, independent consultants do not go splashing information on their earnings all over the place. The consultants are quite apprehensive about divulging such information. One of the issues you have to deal with is whether the fees you have set are too much or too little. Without the right information from your industry and other consultants, you would be in the dark.
Your location also plays a huge role in determining the kind of fees or rates that you charge. For example, independent consultants in coastal or urban places tend to attract (or charge) higher premiums compared to their colleagues in suburban areas. In fact, the difference can be by as much as 25%. The independent consultant fees for a professional operating in Southern or Midwestern places in the United States are often quite low too. However, consultants who meet the following requirements can charge high rates regardless of location:
- providing valuable and specific expertise
- enjoy better name recognition
What and how you charge also depends on your experience as an independent consultant or in the industry. For example, a beginner consultant will most likely charge hourly or daily rates. This is the best option for a consultant who has only a few service packages. Independent consultants offering their expertise in IT and Social Media fields prefer charging hourly rates. On the other hand, several other consultants prefer setting project-based rates. Project based rates are popular with consultants providing services in the following industries:
- web design
- graphic design
- public relations
Lastly, do not set your independent consultant fees until you clarify all the grey areas with your client. Otherwise, you may find yourself providing excellent services at no cost, which could cause your business to suffer. Also, there’s no harm in offering discounts or free consultations to first-time clients to attract more. If your skills deserve it, do not hesitate to charge high rates. Charge what you deserve without worrying about the most common fears that stop independent consultants from succeeding in their chosen professions.