The global consultancy business market crossed 160 billion US dollars.
As a consultant, you can make a real difference in your clients’ lives and build a thriving business. But how do you set yourself apart and grow your consulting business to new heights?
If you’re looking to grow your consulting business and find your niche, this article is for you. You’ll learn proven strategies to help you build and grow a consulting business, whether you’re just starting out or you need some tips to get out of the rut.
From developing the right mindset to finding the right partner, you’ll learn actionable advice to give your consulting business the boost it needs.
What Is A Consulting Business?
“As consultants, we need to be ruthless in discerning what is important and what is just noise.” — Luk Smeyers.
A consulting business is a professional service firm that provides expert advice and guidance to organizations or individuals.
The primary purpose of a consulting business is to:
- help clients improve their business performance
- solve problems like having unsatisfied customers
- make informed decisions with the help of data-driven insights
- increase efficiency by using technology software and platforms
- maximize profits.
For example, a small retail company facing a drop in sales might not know where to look to understand why it’s happening. In this case, consulting expertise with someone in this field can identify what’s going on a provide solutions to move forward.
Consulting businesses have a team of experienced professionals specializing in different areas, such as finance, management, operations, sales, marketing, and strategy. They help bring a fresh perspective and outside point of view to help clients see their situation from a different angle.
Consulting Firm Business Models (Advantages & Disadvantages)
1. The Firm Model
The firm model is the traditional way of operating a consulting business, with a team of consultants working together to deliver services and advice to clients.
In the firm model, the team is made of highly experienced personnel, established processes and procedures, dedicated customer service staff, and internal support teams.
A hierarchical structure often characterizes the firm model. They’ve clear lines of authority and defined roles and responsibilities for each employee.
Advantages
- It allows for growth and scalability as more clients and projects get added. The team allows for growth.
- This model allows for specialization in specific industries or areas of expertise.
- You have more resources and support staff, allowing for more comprehensive and effective services for clients.
- A consulting firm often has a stable revenue stream and can weather market fluctuations and economic downturns better than individual consultants.
Disadvantages
- The firm model can result in bureaucratic processes and decision-making. So, it can lead to slow response times and lower flexibility when it comes to changes.
- It can be more expensive due to overhead costs and a need to maintain profitability.
- Since a firm’s success can depend heavily on key personnel, their loss can significantly impact the firm.
2. The Productized Model
You have a productized consulting business model when you package your service in a product form and sell it with predefined parameters. The product/service has a set scope, pricing, and delivery method, making it easier for consultants to sell without having too much back-and-forth with potential clients to customize the offer.
This approach allows for more predictability in revenue and simplifies the sales and delivery process.
Advantages
- Such services are typically more efficient and can be deployed quickly, reducing overall time to market.
- It helps you with cost savings due to lower labor costs and the ability to reuse existing code or infrastructure.
- You can quickly scale up or down depending on client needs, allowing for more pricing and service delivery flexibility.
- It provides a predictable revenue stream as customers purchase specific products or services.
- The productized model offers a clear value proposition, making it easier for customers to understand the product’s or service’s benefits.
Disadvantages
- The productized model offers a limited scope of services and may not be suitable for customers with more complex needs.
- This model can limit the creativity and problem-solving capabilities of the consultant, as the focus is on delivering a predefined product or service.
3. The Solo Customized Model
The solo customized model is a business approach in which a single consultant offers customized consulting services to clients on a project-by-project basis.
The consultant takes on full responsibility for the success of each project and works directly with clients to understand their needs and provide customized solutions.
Advantages
- The solo customized model allows for high flexibility as the consultant can tailor their services to meet each client’s needs.
- It gives the consultant more control over the creative and problem-solving aspects of the project.
- You can offer more personalized service as you work directly with clients on a project-by-project basis.
- The solo customized model typically has lower overhead costs than a larger consulting firm.
- This model allows you to make independent decisions and respond quickly to client needs.
Disadvantages
- The solo customized model can be less scalable than the firm or productized models.
- It can be less predictable in terms of revenue, as the success of each project depends on the consultant’s ability to secure new clients and projects.
- This model places increased responsibilities on the individual consultant, who is responsible for all aspects of the business, including marketing, sales, and delivery of services.
Factors To Consider Before Choosing Your Consulting Firm Model
Choosing a model to grow your consulting business depends on your goals, skills, resources, and the market demand for your services.
Consider the following factors before you decide:
- Cost-effectiveness: Investing in a model that maximizes your return on investment is critical. Determine how much money you can spend upfront and how much you need to recoup over time.
- Scalability: Choose a model that can handle an increase in demand and scale with your business’s growth. Ensure that the model you choose offers easy scalability to stay ahead of the curve.
- Ease of use: A successful consulting business relies on user experience and satisfaction. Look for models with simple and intuitive interfaces so clients have an enjoyable experience working with you.
- Service offering: Identify what services your target audience needs and focus on providing those services at a competitive rate within the market landscape. A well-rounded service offering will give clients more reasons to work with your consulting business over others.
- Target market: To ensure optimal success, define who your ideal customer is and tailor your services to meet their needs, budget, and preferences. Consider any region-specific issues or social trends influencing your success before deciding on a growth model.
How to Grow a Consulting Business: Get Expert Help
Between 2018 and 2023, the US Management Consulting market size increased by 4.7% yearly.
So, how to grow a consulting business in this hugely competitive market? Get expert help to build a great business.
By getting expert help, you can tap into their depth of knowledge and experience, bringing new insights and solutions to your clients. It’ll help you offer more specialized services and differentiate yourself from your competition.
Working with experts will provide new networking opportunities and open the door to potential partnerships and collaborations.
Experts also provide guidance and support in marketing, finance, and operations, allowing you to streamline your processes. Examples of expert help include people who work with marketing funnels (to help you build out a great funnel), SEO experts (to help with on-page optimization), and HR professionals (who can help with hiring great staff).
Develop Growth Mindset: Growing a Consulting Business
“You’re in charge of your mind. You can help it grow by using it in the right way.” —Carol Dweck.
If you’ve got a growth mindset, you’ll approach challenges and opportunities with a focus on growth and learning. You will challenge your beliefs and be ready to face obstacles.
This mindset shows your clients that you are committed to continuous improvement, delivering value, building strong relationships, and driving business growth.
What does a growth mindset look like?
- Setting clear goals and objectives
- Creating action plans to achieve them
- Focusing on continuous improvement of your services
- Leveraging technology to stay competitive
- Testing new ideas and approaches to problem-solving or customer service
- Staying aware of industry trends and changes in the market landscape.
Use Tools To Automate Your Consulting Business
If you’re wondering, “How to grow my consulting business fast?” The answer will always contain automation.
Automation can help you streamline processes and maximize efficiency in your consulting business.
Automating mundane tasks such as tracking time, invoicing clients, or managing customer communication can free up your time.
Some tools you may consider using include:
- Project management software (Trello, Asana)
- Time tracking and invoicing software (QuickBooks, Zoho Invoice)
- Customer relationship management (CRM) software (Salesforce, HubSpot)
- Communication tools (Slack, Google Meet)
- Marketing automation software (Sendinblue, Mailchimp)
Understand Your Clients & Grow Consulting Business
If you understand your clients, you can develop strong relationships, provide tailored services, and better meet their needs.
Here are some tips to help you understand your clients better:
- Ask your clients about their goals, challenges, and needs.
- Observe their behavior to get insights into their motivations and preferences.
- Research your client’s industry, competitors, and target market.
- Get feedback from your clients regularly to improve your services.
- Try to put yourself in your client’s shoes to know their perspective and situation.
- Learn from past interactions to improve future interactions.
Improve Client Reviews On Your Consulting Website
New research suggests that 52% of consumers with bad experiences tell their friends, family, and colleagues. But it’s not all bad! 56% of consumers are quick to share a positive experience, when asked.
When clients post reviews about your consulting services, they believe you’re trustworthy and capable of delivering value.
Fact: Positive client reviews can help you grow your consulting business.
To improve client reviews:
- Engage in active listening.
- Set clear expectations
- Provide Quality Services
- Build Relationships
- Follow up with clients after sessions.
- Encourage Reviews.
Sell Results For Faster Lead Generation
When you sell results, you demonstrate your expertise and showcase the value you bring to your clients. It creates a compelling reason for clients to choose your services over your competitors.
It can also establish clear expectations and goals with your clients, ensuring that you understand what you are working towards and what you will deliver.
How do you “sell results?” By showcasing the journies of past clients and letting their success stories do the selling. You can show screenshots of their messages that share their wins (with consent, of course) and video/written testimonials. Focus on numbers and data when you share results – they’re always very relatable and easy to understand for people. E.g. “Our client, Mary, made $15,000 in one month after implementing our advice.”
You can see how we share our client wins at Scaling With Systems, here.
Competitors Analysis: Consulting Services
It would help if you analyzed your competitors to identify opportunities for differentiation and growth. By conducting competitor analysis for your consulting services business, you can:
- Identify the strengths and weaknesses of your competitors, which can help your brand positioning.
- Gain a better understanding of the market and your target audience.
- Stay ahead of trends and shifts in the industry.
- Identify collaboration or partnership opportunities.
- Learn from your competitors’ successes and failures.
It’s always valuable, no matter the business you’re in, to know what your competitors are doing. This can show you how your business is unique, clarify the value of your services, and also give you ideas of how you can grow and stay competitive.
Organize Consulting Business Events
Organizing consulting business events helps you to network with industry experts and potential clients, build relationships and foster a sense of community (that’ll pay off later down the track), and showcase your offers. Engaging with people face-to-face builds better connections in business, especially with potential collaborators, or people who may want to hire your services.
Find the Right Partner
A good partner can bring complementary skills and new perspectives to your consulting business. It will help you to scale your consulting business by sharing the workload, supporting you during tough times, and bringing new connections.
It’s important to carefully evaluate a potential partner’s compatibility, financial stability, work ethic, and values before entering a partnership.
Making the right decision can mean the difference between a thriving business and one that struggles to survive. Remember, you’re going into business with the whole person, not just their skills. This means assessing your potential partners based on how well they communicate, what their interpersonal strengths are, and how they align with your own values.
FAQs: Grow Your Consulting Business
How Can I Improve My Business Consulting?
To improve your business consulting services and increase revenue:
- Offer a free consultation to potential clients
- Develop a clear understanding of the client’s needs and expectations
- Utilize technology to streamline processes and keep projects on track
- Network with other professionals for valuable advice
- Maintain detailed records of every project.
What are three characteristics a consultant should have to be successful?
The three main characteristics that a consultant should have to be successful are:
- An ability to solve problems.
- Excellent communication skills.
- The capacity to think strategically.
Problem-solving skills allow a solo consultant to quickly identify issues and develop solutions tailored to the client’s needs. Communication skills enable you to explain your solutions and gain clients’ buy-in. And strategic thinking allows you to see the big picture to create long-term success strategies.
How Do You Attract Consultants?
Here are a few ways to attract consultants to grow your business:
- Offer competitive rates that match the value of the services you provide.
- Have clear, concise expectations set out before any project begins. It eliminates confusion and sets benchmarks so that you can track progress easily.
- Provide exciting and rewarding projects that allow consultants to stretch their skillset and showcase their expertise.
- Offer flexible payment terms, such as partial payment upfront or performance-based bonuses at the end of each project.
- Create a positive work environment where feedback is welcomed and respected, and team members feel appreciated to work with clients.
What Are The Key Skills Of A Successful Consultant?
Some of the key skills of a successful consultant include problem-solving abilities, communication skills, strategic thinking, adaptability and flexibility, industry expertise, and knowledge, and a desire to keep learning.
Wrapping Up: Grow Consulting Business
It takes time, and some intelligent use of the proven strategies you’ve learned about, to become a consulting expert.
Choose a consulting business model that works best for you. And remember to use automation tools to make your workflow efficient.
With these strategies, you can build a strong foundation for growing a consulting business.
If you’re looking to get consistent leads every month, we can help. Scaling With Systems builds time-tested, proven client acquisition systems for consulting businesses. You’ll get new leads coming in that convert with ease (all while scaling back on your workload). Book a call with one of our advisors, and see if we’re the right fit to work with one another.
