Start a Consulting Business: 10 Insights to Help You Be Successful

Summary

In this video, Chris from FirmsConsulting shares 10 key insights to help individuals succeed as freelance online consultants, especially those transitioning from corporate roles like management consulting or banking. He emphasizes starting quickly, focusing on niche, bite-sized work, managing competition, and delivering high-quality, reliable service. Chris discusses the importance of reviews, the need to understand low margins in global competition, and preparing for a challenging 'burning period' when building your profile. Ultimately, he encourages long-term thinking, building a strong profile, and developing a sustainable consulting business that can scale beyond just selling time.

Takeaways

• 🚀 Start quickly and consistently build your online presence; early momentum and delivering value are crucial in a winner-take-all economy.
• 🔍 Focus on bite-sized niche projects for small clients initially to generate reviews and build credibility on platforms.
• 📈 Manage a volume-based business carefully; avoid overcommitting and control project scope to maintain quality and meet deadlines.
• 💻 Prepare for isolated work; most online consulting is remote and independent with minimal client interaction.
• 💰 Understand margins and cost-of-living differences; competitive pricing may be necessary to remain profitable while delivering quality work.
• 🏆 Differentiate through excellent customer service, responsiveness, and consistent quality to retain clients and build long-term relationships.
• 🔥 Be ready for a 'burning period' where initial projects may require low or no fees to gain reviews and establish credibility.
• ⭐ Reviews are critical; maintain high-quality output and timely delivery to secure 5-star ratings and attract future clients.
• 💵 Navigate a price-sensitive market; start competitively, but over time leverage your reputation to reduce reliance on price competition.
• 🗣️ Know your audience and communicate in their language; avoid jargon and focus on the practical value you provide.

Q & A

Why does Chris emphasize starting quickly when building an online freelance consulting business?

Chris highlights that the online platform operates as a winner-take-all economy, where success breeds more success. Starting quickly allows consultants to showcase their skills, build reviews, and gain visibility before competitors, increasing their chances of securing clients.

What is the advantage of focusing on bite-sized, niche work for small clients?

Focusing on small, niche projects helps new consultants build a strong profile and gather reviews quickly. Platforms heavily rely on reviews to assess trustworthiness, so completing smaller projects with high quality increases the likelihood of being hired for future, larger projects.

Why is managing a volume of projects important in freelance consulting?

Online consulting is a volume-driven business. Taking on many projects can generate income and reviews, but it requires careful scope management. Mishandling multiple projects can lead to poor performance, negative reviews, and damage to the consultant's profile.

What does Chris mean by 'managing isolated work'?

Managing isolated work refers to the fact that online freelance consultants often work alone, usually from home, without physical client interactions. Consultants must be self-motivated, disciplined, and prepared to deliver high-quality work without in-person supervision or collaboration.

How do geography and margins affect online freelance consulting?

Consultants in high-cost regions may earn less relative to local expenses compared to those in low-cost regions. For example, a $100/hour rate in Connecticut has a lower margin than the same rate in India due to differing living costs. However, perceived quality based on geography can influence initial client trust.

What strategies help a freelancer manage competition on online platforms?

To stand out in a competitive market, freelancers should provide excellent customer service, deliver high-quality work on time, and maintain responsiveness and reliability. Building trust through these behaviors encourages repeat business and referrals, moving beyond competing solely on price.

What is the 'burning period' Chris refers to, and why is it necessary?

The burning period is the initial phase where freelancers may need to accept lower rates or even do some work at no cost to build reviews and credibility. This phase is essential for creating a strong profile that attracts future clients and enables long-term profitability.

Why are reviews so critical in online freelance consulting?

Reviews act as a social proof mechanism. High-quality, consistent reviews signal reliability and capability to potential clients. Platforms and clients heavily rely on these reviews to assess risk, making them crucial for building trust and securing new projects.

How should freelancers handle pricing on competitive online platforms?

Initially, freelancers may need to compete on price to build credibility and reviews. Over time, as they develop a strong profile and loyal clients, they can move away from price competition and focus on value, quality, and client relationships to maintain profitability.

Why is understanding the audience important for online freelance consulting?

The online audience may not be familiar with advanced terminology or complex strategies. Consultants must communicate in clear, accessible language and focus on practical solutions to ensure their expertise is understood and trusted by potential clients.