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... nobody yet has responded with "big bucks." No matter how much you make, it never feels like too much.
What is involved in Private Consulting isn't just the job of going to the client and producing a solution.
It's all the other things that go along with the Consulting, The Insurance Cover you need, the Tax Issues of being Self Employed or worse running a company with staff.
No matter how many hours you put in for the client you just know you have at least double that time to run the business and that doesn't generate any income though it may save you quite a lot in Fines from places like the Tax Man it doesn't put a single cent into your pocket.
So to get an Over the Top Income you at the very least need to get 300% of what the Consulting Gig costs the client just to break even the way that a Employed Worker for any company would.
Col
It's all the other things that go along with the Consulting, The Insurance Cover you need, the Tax Issues of being Self Employed or worse running a company with staff.
No matter how many hours you put in for the client you just know you have at least double that time to run the business and that doesn't generate any income though it may save you quite a lot in Fines from places like the Tax Man it doesn't put a single cent into your pocket.
So to get an Over the Top Income you at the very least need to get 300% of what the Consulting Gig costs the client just to break even the way that a Employed Worker for any company would.
Col
Being in the right niche makes all the difference. I know plenty of consultants who have chosen a very general niche, and as a result, struggle to find work and are paid a much lower rate.
I happen to be very fortunate to be in a tiny niche which pays quite well (database/software consulting for law firms who use a specific enterprise application). As a result, I work less, make more, have an easier time finding work, and am less stressed about my employment situation. In fact, I haven't had to look for work in the past 12 months, since clients have sought me ought instead of me having to seek work.
Since starting my consulting business 5 years ago, I've QUADRUPLED my former day job salary.
The whole reason for this is because I'm in a very small niche. You can be in a niche (e.g., Ruby on Rails), but to make things easier for yourself (i.e., have plenty of work, have a high bill rate, have less competition, etc.), you need to be in a very focused niche. In my niche, there are probably less than 3,000 potential customers, and literally a handful of competitors. And given that the clients are extremely profitable (law firms), that--in addition to my specialized knowledge & experience--means that I'm able to charge a high bill rate, which, in turn, means that I can work less to make the same amount as someone with a lower bill rate.
Finding a profitable niche is sometimes a matter of luck--as in my case--but it's also possible to find profitable niches by doing the right kind of research. I talk in detail about how to do that on my blog.
Lastly, compared to one of the other comments, I spend roughly 15% - 20% of my time on non-billable tasks, and I keep that as low as possible so I can focus on billable work.
You can check out an interview I recently did where I talk about how I made the switch from employee to consultant, and where I talk about some of my initial fears & doubts, and give actual income & rate numbers.
Greg Miliates
StartMyConsultingBusiness dot com
I happen to be very fortunate to be in a tiny niche which pays quite well (database/software consulting for law firms who use a specific enterprise application). As a result, I work less, make more, have an easier time finding work, and am less stressed about my employment situation. In fact, I haven't had to look for work in the past 12 months, since clients have sought me ought instead of me having to seek work.
Since starting my consulting business 5 years ago, I've QUADRUPLED my former day job salary.
The whole reason for this is because I'm in a very small niche. You can be in a niche (e.g., Ruby on Rails), but to make things easier for yourself (i.e., have plenty of work, have a high bill rate, have less competition, etc.), you need to be in a very focused niche. In my niche, there are probably less than 3,000 potential customers, and literally a handful of competitors. And given that the clients are extremely profitable (law firms), that--in addition to my specialized knowledge & experience--means that I'm able to charge a high bill rate, which, in turn, means that I can work less to make the same amount as someone with a lower bill rate.
Finding a profitable niche is sometimes a matter of luck--as in my case--but it's also possible to find profitable niches by doing the right kind of research. I talk in detail about how to do that on my blog.
Lastly, compared to one of the other comments, I spend roughly 15% - 20% of my time on non-billable tasks, and I keep that as low as possible so I can focus on billable work.
You can check out an interview I recently did where I talk about how I made the switch from employee to consultant, and where I talk about some of my initial fears & doubts, and give actual income & rate numbers.
Greg Miliates
StartMyConsultingBusiness dot com
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