Chip Camden highlights the findings from the recent Women in Consulting survey, and concludes what four things the results mean for your business.
- Their median gross income is dramatically higher, $373,000, compared to $99,700 for all respondents
- Two-thirds operate either as a corporation or LLC (which may be required to work with larger companies)
- These consultants are three times as likely to have employees as the other respondents
- They're 50 percent more likely to use subcontractors
- They're also more likely to charge at least part of their fees up front, bill on a retainer basis, and work directly with clients (as opposed to being subcontractors)
Graphic courtesy of texto. (Click the image to enlarge.)
As always, we want to beware of confusing correlation with causation. For example, some of these bullets might be more symptomatic of success, rather than contributing factors.
What seems most important to me in this report is that many of these upper-fifth consultants have continued to grow their business during the difficult economy of the past two years. My own take on that is that when times get tough, clients put their money where they know it will do some good. So rather than taking a risk on less expensive consultants, the smart businesses contract with consultants who have a solid reputation, who know what they're doing so they do it right the first time, and who provide indicators that they aren't going to disappear tomorrow. It can also make sense to contract a consultant rather than to hire someone, because of the potential expenses related to letting them go if they don't work out. Overall, there's much less risk in using a reputable consultant.
What does this mean for your consulting business? Build a reputation for always delivering the goods. Don't under-price yourself. Expect the respect that's due to a top-notch consultant. Be willing to say no to bad business, so you'll have time for the good business.
WIC will host a webinar on November 7th to discuss details of the survey.