Five Best Tips for New, Independent Consultants

As seen on Our Collective POV by Freddie Laker for Chameleon/Collective

Editor’s Note: In this article author Freddie Laker, a successful consultant and founding partner of Chameleon/Collective – an Inc. 500 America’s Faster Growing Private Co., shares his valuable advice on how independent consultants, including appraisers, can ensure their success.

Tip 1: Hone Your Offering – Specialists Win the Day

The first step in any new consultant’s journey should be understanding what they’re going to sell. Start by remembering this simple fact; most employers like to hire generalists because they’re versatile and make sense as salaried employees but typically look to consultants as specialists. As consultants are more expensive than salaried employees, there is an expectation that a consultant has a “superpower” that warrants this additional expense.

As each of us progresses further through our careers, we accumulate more and more experienced, and if asked, “what can you do?” it’s easy to spit out a laundry list of knowledge accumulated over the years. The client won’t be impressed. It’s more likely that they will perceive you as a generalist, and the client will select a specialist over you almost every time.

Find two, maybe three, things that you believe you are an expert at. Write each item down, whether it’s a business analyst, a brand strategist, or an interim CRO, and then pull selectively from your history and experience to come up with a minimum of three supporting facts that establish you as an expert to whatever you selected. One of the best tips for new independent consultants is to throw out your previously generic career bio and rewrite it through the lens of a specialist. Each area you believe you are an expert in has its own unique pitch and story that establishes you as a credible expert. I never recommend that you try and have more than three because it confuses potential customers and your personal and professional social network when trying to establish your personal brand.

[ASA offers a variety of advanced specialty programs, including Intangible Assets, Going Concern, Aircraft Valuation, CEIV^TM, Appraisal Review, Master Gemologist Appraiser® and more.]

Tip 2: Validate Your Offering “Pre-Launch”

Think of yourself as a new product or service that is about to be launched into the market. Sensible entrepreneurs don’t blindly launch a new offering without early market validation by having informal conversations with potential customers to understand how a product or service might fare once launched. Suppose you’re currently employed in a traditional job or even on another career path, and you are considering venturing out on your own. In that case, this is an often overlooked chance to validate your offering before formally announcing yourself as a consultant.

As a new potential consultant, you have an opportunity to reach out to your professional network on a one-to-one basis and ask for informal guidance. My recommendation is to select five to ten people you have worked with throughout your career that you confidently feel understand your skills and the value you deliver. This is important because this initial outreach is not about selling; it’s about gathering meaningful feedback.

Whether it’s a recent colleague or someone you haven’t spoken with in years, everyone appreciates being asked, “I’m considering making a career change. You’re someone I respect and whose opinion I value. Could you find 20 to 30 minutes to catch up and give me your feedback on an idea I’m considering?” Use that opportunity to discuss whether they feel you should continue to pursue your current career in a traditional path or if they believe you would be a good consultant in any of the specializations you outlined from my first tip.

At the end of this exercise, you’re going to either feel confident that you have a clear and compelling offering or that maybe you are better off in a traditional job. It is not uncommon for people to pick up their first engagements this way. If the exercise did not give you the confidence to move forward, then you have now saved yourself the potential embarrassment of publicly announcing yourself as an independent consultant and having to walk it back or do a major course correction.

[ASA also offers valuable networking opportunities via national and local chapter events.]

Tip 3: Understand How to Set Your Consulting Rate

Now that you have defined your specialization and validated that potential customers understand and find value in it, you’ll need to figure out your consulting rate. Many consultants are confused about how to handle this, but these simple rules will make the burden less complicated.

The market sets the rate on any particular skill set, and the more in-demand you are then, the higher you can set your rate. Many advanced consultants will tell you never to do hourly rates and only do a project or value-based pricing. That’s excellent advice for consultants that are experts at accurately estimating the level of effort and masters of controlling client scope creep. Still, in the beginning, I strongly recommend you focus on hourly rates to reduce your risk of a project going wrong.

When you first start consulting, the quickest way to establish an initial consulting rate is to look at what you’re currently making, assuming that this figure allows you to pay all your current expenses and live reasonably. Reverse engineer this number into an hourly rate and then double it – that should be your initial hourly rate if anyone asks. The thinking is that even if you can only sell 15 to 20 hours per week of billable time, then you should be able to cover all your expenses and live close to or at your current income levels. And it goes without saying that if you become a top-rated consultant, you could dramatically increase your earning levels beyond anything you thought was previously possible.

[Another benefit of membership in ASA is access to mentoring programs and the ability to learn from senior expert professionals]

Tip 4: Evaluate Your Confidence

Jumping into the role of an independent consultant means that you are primarily dependent on your ability to generate business for yourself, especially in the beginning. If you’re successful, you’ll build a growing list of happy clients who will re-hire or refer you, and you’ll establish a network of like-minded professionals who invite you to collaborate on their clients.

In the early days, you need to be able to answer this question with confidence: “Can I sell 15 to 20 hours of my time per week every week without any help from anyone else?” If you think you can, then you’re ready to make the jump into independent consulting.

I caution anyone making this decision to not rely on any optimistic views that you are having gigs lined up or that another friend, agent, or consultant will give you all your deal flow. It may happen, but it also may not, and if you’re confident you can do this on your own, then you’re not putting your livelihood or anyone who may depend on you at risk. Also, if you’re successful on your merit and those connections end up coming through as well, you’re going to be extremely busy and successful. A little bit of healthy fear never hurts an independent consultant.

[The Society’s Find An Appraiser online search tool is another popular resource for building contact networks to increase client referrals.]

Tip 5: Focus On Getting Busy Vs. Fussing Over Price

While one of my tips for new independent consultants was on setting your rate so that you can effectively cover all your living expenses even if you’re at 15 to 20 hours in billables per week, this tip focuses on filling up your calendar. When you first start, it’s ok to be flexible because you must become confident in your ability to succeed as an independent consultant. I’ve noticed that when new consultants are too precious about their rate and their own perceived value, they can frequently pass on opportunities, and then if new opportunities don’t arise or they don’t get busy, they get spooked. Once you get spooked, then you start to lose your confidence. I feel like clients can smell that lack of confidence, and then that can create a death spiral where the consultant loses their “mojo” and can’t get on any project, so they give up entirely on this career path.

In the beginning, focus on getting busy. You can discount your listed rate and work 30 to 40 (or more hours) per week to pick up clients. Being busy makes you feel good, and it helps get your name out there as a great consultant. Over the coming months, you can rotate out the clients at lower rates to new clients at higher rates, but you’ll do it with a glow of confidence that will set the tone for your new career.

[ASA’s discipline-centric listserv’s provide a quick and easy forum to ask questions, swap experiences and share tips.]

Editor’s Concluding Thoughts: The journey to becoming a successful independent consultant/appraiser may be filled with many new challenges, but by following the suggested tips and joining a professional organization like ASA, helps pave the path to success.