I was recently asked if I had any advice for someone who was trying to build a consulting practice, particularly given that social distancing is limiting outreach activities to remote selling. Your local bookstore and the internet are both great places for helpful insights into business development in general. Fortunately, much of the advice is very applicable for growing a service business like consulting. And while social distancing makes it challenging to do in-person networking, take prospects to lunch, etc., there are so many other ways to reach out – think concise and compelling emails, LinkedIn, webinars that give you an opportunity to share your expertise for all to see, etc. – that one hardly has the excuse to hide in a bunker until COVID-19 and recession disappear.
For some the word “consultant” actually has a negative connotation, mostly because they have been burned in the past. However, if you have a legitimate body of work, subject matter expertise, a good track record, and great word of mouth, you should be able to dispel those anxieties. The most pressing thing you need to figure out is how to differentiate yourself from your competition. What is your competitive advantage? Exactly what would you consider yourself to be a subject matter expert in?
If you have answers to these questions, then your services should be very marketable. And once you convince yourself that you are selling something that’s worth buying, you then have to assign an economic value to it. When I first started consulting decades ago, I set my rate at $100 an hour. My friend said, “Why are you charging $100? My accountant charges $225, and he’s a lot less smart than you are.” So, I changed my rate to $225, and you know what? Nobody complained. There’s a rule in the business that states that if at least 10% of the people you work with don’t think your rates are a bit high, your rates are probably not high enough! You should always be pricing for value rather than just your costs plus overhead.
There’s an anecdote about a man taking his car into a mechanic, who fixes the problem with a single tap on the engine. The man asks how much that maneuver cost so he could pay him, and the mechanic responds “$100.” The man replies, “Isn’t that a bit much? You just tapped on the engine once.” The mechanic says, “I know. I charge $1 for the tap and $99 for knowing where to tap.” Think about it, you’re likely not only providing activity, but also solutions that are grounded in great expertise.
Another piece of the puzzle is building a brand. These days you need to have a social media presence. You need to have a website where people can see your credentials and press releases. It also doesn’t hurt to have positive feedback from customers you have worked with as well as lists of your clients and partnerships. This is one reason that references who send you referrals are important - not only to increase your supply of promising prospects, but also to provide you with testimonials that will give others the confidence to do business with you.
Above all, remember that you’re offering a solution. A lot of people in the energy solutions space get classified as “consultants” instead of salespeople because efficiency isn’t necessarily tangible. Bottom line, if you’re doing it right, you’re offering benefits that transcend the product or service that you’re selling. As a result, you need to focus on the value you create as opposed to the bits, bytes and blinking lights of whatever you eventually recommend that they install or deploy.