Consultant fee rates sometimes give potential clients sticker shock. That’s because consultant fees and per diem rates sound really high if you’re comparing them to the daily rate at a regular job. However, as my lengthy and detailed post on setting consulting fee rates shows, consulting fees have to account for costs a regular job doesn’t cover. Making money as a consultant means you have to do more than just make a wage.
What consulting fees cover
To make money, independent consultants have to use their fees to cover:
- unbillable time spent on marketing and administration
- medical benefits
- dental benefits
- vision benefits
- sick days
- training days
- education and training
- retirement savings plans or pensions
- stock options
- office facilities
- tech support
- downtime between projects
Consulting fees aren’t that high
When you look at all the things a consulting fee needs to cover, it isn’t all that high. It’s funny, though, that some clients will try to get a consultant to knock down fees. Many of the same people would never question rates charged by their hairdresser, plumber, mechanic, lawyer, doctor or dentist. And yet, if you think about it, those are kinds of consultants, too!
The reality, though, is that you’re not going to get very far if you charge by the hour. If you want to turn a profit and get out of the trap of an hourly rate, you need to move to Solution-Based Fees(tm). See our book for details.
- Consulting fee rates
- Why become a consultant?
- Become a consultant — ideas for kinds of consultants you could become
- Finance for consultants
- Basic selling skills
- Cold calling clients
- Work from home scams
- Consulting fee agreement forms
- Consulting Fees: A Guide for Independent Consultants
- Discover Your Inner Consultant
- “Consultant fee sticker shock” f rom Become a Consultant Blog at ConsultantJournal.com.