One area many independent and small consulting firms struggle with is pricing. Figuring out appropriate fees for services is a challenge especially when first starting out. Additionally, many new consultants usually undercharge for what they offer. So how can you set consulting fees that are both reasonable and appropriate?
The only way your consulting business will continue to thrive is if you properly evaluate how you want to get paid and what your financial needs are. Determine if you want to set fees at an hourly rate or by the project. Many potential clients are hesitant to work with new consultants outside of a daily or hourly rate agreement. In most cases, a set rate is easier for those starting out.
Another way to determine fees is by assessing your income objectives. Set your fees according to what you need to achieve the income objective. Entrepreneur suggests identifying a floor for your fees by “taking your aspirational fee income and dividing by 1,200 (12 months X 100 hours per month).” This will give you an idea of what your rate should start at. From here you can raise or lower it depending on the viability of the business model.
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