Consulting Rates: Am I Fit For Premium Rates?
Different businesses will have different consulting rates. Sometimes individuals will start a computer consulting business as soon as they graduate from school, while others will work in the industry for other companies for a long time before deciding to open up their own businesses. Because not every computer consulting business is the same, consulting rates will be completely different based on experience levels and skills.
Sometimes computer consulting business owners will have bachelors degrees, other times they will not; similarly, some consultants will have many years under their belts, while others will just be starting. There is also a great discrepancy between ages of those in the computer consulting business, so if you are involved in the industry, you may have a hard time figuring out when you can charge premium consulting rates for your services.
DETERMINING CONSULTING RATES BASED ON EXPERIENCE AND QUALIFICATIONS
If you have pretty god people skills and technical skills, can do the job and can be a positive addition to a sweet spot small business in need of an IT expert, your age, experience or education should not play much of a factor in the consulting rates you can charge.
Also, if you are starting a business in your 50’s and 60’s and this is a second job or a major career change, you can also set premium consulting rates. Your competency as a computer consulting specialist is far more important than your age, experience or education level.
When setting your IT consulting rates, the most important issue is the value you provide as a computer consulting business to a client. If you provide services the company can’t do alone and help raise productivity and cut business expenses, you are completely justified in setting premium consulting rates.
IT Consulting: What Rates Should Act as a Starting Point?
Rates can vary quite a bit in IT consulting. Some charge zero, others at $25 – $45 per hour. But none of these are the most desirable rates for your IT consulting business.
IT CONSULTING BUSINESS START-UP: HOW MUCH SHOULD I CHARGE?
Ideally, when you start your IT consulting business you want to charge anywhere from $75 – $95 per hour so you can build a good reputation for your company. Starting out at a lower rate will give others a false impression of the sophistication of your business and its solutions.
IT consulting professionals that work with larger small companies charge over $100 per hour, depending on their specialties, their involvement in a vertical industry or where they are located.
IT CONSULTING BUSINESS RATE ADJUSTMENT
One of the biggest mistakes IT consulting businesses make in the beginning is undervaluing their true expenses, and many will end up charging too little for IT consulting services. The problem is, adjusting rates is very difficult, so as a computer consultant you need to set rates high enough in the beginning.
Your existing customers and clients will not respond well to significant rate increases and will often insist that you keep them at your initial rate, meaning a lot of clients are left that have been grandfathered in at lower rates that are not affordable for you.
THE REAL PROBLEM WITH RAISING RATES
When you grandfather rates, often half to a quarter of your total IT consulting business becomes worthless and unprofitable. You will probably not be able to easily convince existing clients to agree substantial rate increases without compromising trust and credibility.
Charge enough at the beginning so your business can remain profitable and grow. Otherwise you will find yourself scrambling later.