Why consulting? This guide contains everything you need to know about being a freelance consultant, answer the questions you might have, and tell you what to be aware of.
How to start? What are the steps? And what can you get out of it? Jump right into it below and find the answers.
This guide works for everyone who thinks about getting into consulting, but also for current consultants who might have some questions.
What is consulting?
Consulting is about providing your expertise within a certain area to a specific group of people. This is not just in one field, but can be in many different ones. For instance, you have consulting within Business Strategy, Marketing, IT, Management and so on. This is just to name a few – there are an abundant amount of other fields.
Therefore, consulting work is also not only for specific people who have high Harvard MBA’s degrees and different certifications, but can be for anyone who can provide expert advice within their field of work.
Since the term “consulting” is so broad it also implies that you can work with it in different ways. On one side, you can work for one of the big consulting firms where you have a more structured career path ahead of you.
On the other side, you have the option of doing freelance consulting work. Here you can pick and choose what projects you find interesting to work on and with which companies. You get more freedom, and it doesn’t necessarily mean that you only work on short-term projects – it can easily be quite the opposite.
1. Monetary benefits
The first thing that comes to mind is how much you can earn? It of course really depends on your field of work, how much experience you have, your background, and if you’re a freelance consultant or not. For instance, an entry-level freelance consultant can expect a salary around 40.000 DKK a month on average in Denmark, and with more experience comes more money. Around the same number is seen in the US. And this is without the bonus that might come on top of that.
2. A great possibility to travel
Working as a freelance consultant gives you new possibilities in terms of where in the world you want to work. It is not unusual that consultants will travel to other countries to work on projects. Big consulting companies might even send you to workshops or events in new countries for you to gain further experience.
So what about VISA, insurance, tax registration etc.? Some companies are able to easily help you with all the paperwork that is involved with such a decision, so you don’t have to think about the hassle. You can read more about that in chapter 9.
3. Get more experience and knowledge within your field
One thing you can be sure of as a consultant is that you will learn – a lot, and quickly. If you’re hired on a project basis, you will typically change projects after every 12, 6 or 3 months. Which could mean that you continually need to adapt to a new situation and circumstances. That just means that your rate of learning will be much higher compared to being in the same industry. Which leads to the next benefit.
4. You can progress quickly
Since you have the option of being part of many different projects in a fairly short period of time, you get the option of progressing more quickly than the rest of the peers in your industry.
If you’re able to prove your worth and manage your projects, you could be facing more responsibilities or even managing roles in your next project. It is basically up to you how how fast you progress.
5. Great way to expand your network
Doing consulting work will undoubtedly expand your network. You get the chance to meet a lot of different people. One thing is other consultants that will be working on the same projects as you, but there’s also the different clients, as well as all the people you meet in the office. Not forgetting, that if you go abroad, you all of a sudden have an international network as well.
You might even grow strong ties with the people you meet, who in the future could help you with new career opportunities.
How to be successful?
There’s not one straight answer to this, but rather a few things that you need to look into. See the steps below.
1. Choose your consulting service
First step is to figure out which type of consulting service you want to provide. Pick something that you’re passionate about or where you can provide your expertise. You can help yourself in the process by answering yourself the following questions:
Where do you have your passion?
As mentioned, it’s important to pick something that you can see yourself working with for a long time – the thing you have a passion for
What do you feel you’re best at?
This all comes down to what special skills you have, and what you can provide expertise in. But it’s also good to think about what you’re not good at. You can’t be an expert in everything, and knowing your good and bad sides can help you narrow down what the best consulting service for you should be.
What can you expect to earn?
If you’re in doubt about how much you can earn, look at the benchmarks for your specific title and industry. You can also use a freelance consulting platform to get transparency of what the hourly rate is of other consultants in your field. If you’re starting out, you need to expect your hourly rate to be lower, but that it can increase fast with the additional experience you get.
Besides that, you can research what skills are currently in high demand and which areas you can expect to get top consulting jobs. Jump to chapter 7 to read more about that.
2. Learn how to sell yourself
Besides picking your consulting service and figuring out what you’re good at, you should learn how to formulate that to a potential client as well. There should be a clear link between what you’re an expert in and what type of work you’ve done in the past. That goes both for the oral and written presentation about yourself.
Be aware of who you’re communicating with. They might not have the same technical knowledge as you, and it’s up to you to explain the true value of your skills.
The better you become at selling yourself, the better chance you have of achieving success, and you make sure to be put on the right projects where the clients know exactly what to expect. You want to avoid being put on the wrong projects because the client had the wrong impression of what’s your expertise. That could potentially lead to a failed project where you become the one to blame.
3. Get on top of your paperwork
When starting work as a freelance consultant, you’re your own business owner. That means that you need to research things like what the requirements are for tax, VAT, and if you need certain licenses etc. in your current country.
In Denmark, you would typically just register your own company and get a CVR number, so you can start providing your consulting services. Here there’s different types of companies that you can register, and depending on that, there’s some certain legal requirements to be aware of. Read more here.
In terms of the rules of tax and VAT, it is a good idea to get more information from the tax administration office in the country you’ll work.
4. Expand your network
In order to find your clients, it’s a good thing to start building up your network. There’s different ways of doing this. One is going to different events where you can meet people that need your exact skill set.
Another thing is taking advantage of your current network to help you out. Maybe you have a prior colleague who knows people that could use your help. There could even be someone in your network that already has their own business and could use your expertise. So don’t hold back on starting to send out emails to friends, family, and work colleagues, letting them know that you’re looking for referrals or want to provide your services.
What is required to be a consultant?
Consulting is all about giving expert advice to others and help solve problems. In order to do so, you’ll need some experience which can help you establish a good brand for yourself. And if you want to work for one of the bigger consulting firms, having a college degree will help you out greatly. It’s a different story if you’re looking at doing freelance consulting work – in general, you’re not required to have a college degree.
In both areas, the experience becomes the most important thing to have. That’s the first thing clients or firms will look at. Even if it’s needed that you have certain skills, there are several online classes that you can attend or classes at your local university to sign up for.
In any case, try to get as much experience as you can and evolve your skills, to become a better consultant. Just be aware of the projects you take on is something you think is worth your time and that you can learn from. It can be okay to learn how to say “no” too.
Do I have what it takes?
Being a freelance consultant requires a certain personality. You need to be aware of the fact that you must be able to thrive under pressure. From day one, you’re putting your name on the line in order to deliver.
Therefore, if you don’t have a heavy professional background to begin with, you’re taking a chance – to get more exposed, more than you normally would be. But, if you can live with the uncertainty and pressure, you can get a career that brings you lots of challenges and financial benefits.
What makes a good consultant?
It’s difficult to say what makes the perfect consultant but there are some personality traits that can help you greatly.
You have attention to detail
This is one way to build up trust with your client. When you deliver error-free deliverables, you show that you’re thorough and trustworthy in handling your tasks. This includes being on top of things like grammar, spelling mistakes, or miscalculations.
You're aware of your own skills
It’s an important quality to have self-insights and be aware of what you’re good at – and not good at. If you know your limitations and your strong suits, then it’s easier to explain to a client how you can bring value to them. At the same time, you know your weaker sides and are able to compensate for them by being honest about it.
You show commitment
In general, it’s good to show commitment if you want to succeed. Therefore, showing that you’re dedicated and have a positive attitude towards your given tasks, will impact the people around you. This will also give the client comfort in knowing that you have the capabilities to reach the goal.
You are confident and a teamplayer
Showing that you’re confident about your skills and expertise, again gives the client comfort. At the same time, you leave your ego at the door and put the company’s goal and team spirit first.
What to be aware of as a freelance consultant?
There are certain things to be aware of before starting your freelance consulting career. As with any other job, there are dis- and advantages involved with it. In this case, you’re giving up on the safety of an employment contract and leaping into independence. In return, you get freedom, flexibility and the chance of earning more money.
Here is a list of what else to take into consideration.
It is always good to have a proper contract in place. A contract should highlight your main tasks and what you and your client have agreed on in terms of responsibilities. A contract should typically include:
- The deadline of when the task/project needs to be done
- A description of the tasks involved in the project
- Where the project is located
- The salary – either an hourly rate or a fixed priced
- Expenses involved such as phone, laptop or a car
- Who owns the rights of the product being delivered
- Rules for termination
In some countries, a Union can even help you make sure the contract is formulated correctly, and if anything is missing.
Sending invoices and getting paid on time
If you’re having many smaller projects going on at once, it’s your responsibility to send out the invoices. Getting paid on time is therefore up to you.
A good idea is to create an invoicing schedule to keep better track of it, and make sure the invoice is sent out in time for you to get paid. There are luckily different tools that can help you with that, such as:
You can also avoid this hassle. When you’re employed through Qemploy, your time registration and invoicing go through the platform – easy and simple. In that way, you can be sure to get paid.
What should your invoice include?
In case, you insist on doing all the invoicing on your own, this is what you should include. An invoice should basically explain the work you’ve done and how much it’s going to cost for the client. See what else in the list below:
- Invoice number and date
- Your name and address
- Your VAT number (CVR number in Denmark)
- Details of your registered business address if you have one
- Details about the work you’ve done
- The amount that needs to be paid
- Your payment terms – for example within 30 days
- Your bank details of where the money needs to be transferred
Periods of being unemployed
Part of being a freelance consultant can include periods of being unemployed. Sometimes the right project is just not there, which means you need to prepare for this.
It’s a good thing to put money aside for savings when you’re employed. That can help you out in times of unemployment. Put together a proper budget where you account for everything, including your debts and assets as well as the money you want to save each month.
It’s difficult to say how long unemployment will last, but it’s better to save as much as possible.
In Denmark, there’s also the option of getting financial support from an A-Kasse. Though, there are certain requirements.
Learn how to become structured
For some freelance consultant, having several projects going on at once can easily be the case. Therefore, you got to be disciplined so you can make sure to meet the different deadlines for clients. On the other hand, you also got to make sure that you don’t take on too many projects.
There are several good project management tools out there that can help you manage your time better, and give you a better overview of your schedule. Here a few good ones:
VAT and Tax
You have to keep track of your earnings each year and make sure that you pay your taxes. In Denmark, it includes creating preliminary income assessment and tax assessment notice. So make sure to check the tax rules in the country you’re working.
You also have to make sure that you have a VAT number when you’re running your own business – typically. If you want to do freelance consulting work without having a VAT number, you can do that through services like Qemploy. Here, everything is taken care of.
Most popular consultant job titles
Most in-demand projects
- Marketing and Sales strategy
- Growth Strategy
- Opportunity Assessment
- Business Processes
- Product Strategy and Launch
- Supply Chain
- Business Intelligence and Analytics
- IT and Tech Transformations
- Interim Executive
The survey was made in January 2019 and is carried out each year at the same time. Obviously, what is demanded now might change in a year. Moreover, the survey looks at what skills are currently demanded:
Most in-demand skills
- Project Management
- Market Landscape
- Growth Strategy
- Strategic Planning
- Supply Chain
- Program Management Office (PMO)
- Corporate and Business Unit Strategy
- Product Development and Launch
- Market Access and Value
- Innovation Strategy
One needs to take into consideration that this is just one survey among several. At Qemploy, we’ve made our own research and found the following skills to be relevant.