Business Consultant....fastlane?

[Deleted11391]

Hi Guys

Would you classify "Business Consulting" as Fastlane?

The fact that you are selling a "result" instead of a product as such, means that you can potentially earn much more than a standard hourly rate or price per item. Its all about perceived value and therefore there is huge price elasticity depending on the industry and client size etc.

There is also the element of being able to leverage knowledge and Time, due to providing clients with tasks to complete, and if needsbe outsourcing these tasks for them.

Would love to hear from others here to see their views on this, and in particular if there are any current or ex consultants here who have maybe changed their business practice based on TMFL criteria?

Thanks
Brian

 

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[MJ DeMarco]

Would you classify "Business Consulting" as Fastlane?

Are you getting paid based on results? And residually?

Then yes, something like "we will pay you 1% of all gross sales exceeding the base level for the next year"

Or, if you manage a team of consultants and are paid based on their work expenditure... they make $35/hour, you make $15/hour, client is billed $50/hour.

 

[jon.a]

Mrs jon and I were retail consultants for years near the turn of the century. It was an interesting well paying job.

 

[Deleted11391]

yes MJ, thanks for the speedy reply.

I should expand on my original post....

Income isn't based on a strict "per hour" basis, but rather priced based on results and objectives completed. The price is based on how much value it brings to the client in the short term and long term.

There is an upfront fee and recurring income based on increased profits/turnover as dictated in the proposal.

It obviously becomes more fastlane, later down the road.... once i make the transition from consultant to consultant firm owner, as i will be able to leverage the time and hours of employees etc...

I'm evaluating whether to go down this route or whether my time and energy is best spent elsewhere.

Currently I'm evaluating and keeping an open mind to starting another business venture, which will be a fastlane business of some sort in the very near future.

I like the idea of utilizing a commission based sales team for a business, whilst being able to deliver the service/product myself and via others......consulting was one of the ideas i had came up with and which matched my skills and experience.

 

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[Deleted11391]

Mrs jon and I were retail consultants for years near the turn of the century. It was an interesting well paying job.

Hey Jon, any particular reason you got out of this business?

 

[jon.a]

Hey Jon, any particular reason you got out of this business?

We had to travel to each deal. 10-14 weeks each. All over the country. An exciting, tough lifestyle.

We found an opportunity we wanted to participate in.

We had to go home to take care of aging family.

In that order chronologically. Each point is its own story.

 

[Deleted11391]

We had to travel to each deal. 10-14 weeks each. All over the country. An exciting, tough lifestyle.

We found an opportunity we wanted to participate in.

We had to go home to take care of aging family.

In that order chronologically. Each point is its own story.

Yeah the travel side of things is one of the "issues" i have with this business as i have young family. There is of course the opportunity to do calls via skype etc, but this wont always be feasible or acceptable in some cases.

 

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[ExcelGuy]

You're still working on a limit of your own time unless you are getting residual income from the detail.

Nothing wrong with being a business owner, but since the question was "Is it Fastlane" then I think it would be no. Also having employees has other difficulties and limitations that MJ goes over in the Book.

 

[thehighlander]

If you do the work once and get paid once, it's not Fastlane; it doesn't scale.

 

[lowtek]

I'd like to point out, just because something isn't strictly "fastlane" doesn't mean it isn't a path worth pursuing.

Consider a couple different paths:

1) start consulting biz now (in a field you know something about and can hit the ground running), hit 100k in revenue end of year 1

2) start ecom biz, where you know nothing and have to get over that learning curve, and maybe 25k in revenue at the end of year 1, but possibility to scale to 100k by end of year 2

In 2 years, path 1 will yield almost twice the revenue (even assuming no growth or residual income) as path 2.

If you project out 3 to 5 years, the calculus may change. The ecom biz may very well hit 200k a year by year 3, but that only puts it marginally ahead of path 1, even if you assume no growth in that path. By years 4 and 5, the eCom biz may very well overtake the consulting business as it scales to 300k/year.... but again we have assumed no growth in the consulting biz. This raises the question, what can you do with that extra money you make in path 1, in the interim, to become financially independent?

IMHO, the obsession with building a fastlane business right from the very start can result in some lost profits and opportunity costs. If you have a good reason to believe you can get a 6 fig. consulting biz off the ground quickly, then I would opt for that - even if it's not within the framework of CENTS.

Why do I say this? Because you can then put that profit into something that produces semi-passive income (multi family rental units, for instance). After a few years of hard work, you can have a large enough portfolio to cover your living expenses + a little walking around money, and then be able to transition from the consulting into something else that falls within the framework.

It's the same reason I would almost never urge someone to quit their job to start a business. Starting a business is a difficult endeavor, and success is far from guaranteed. With the right mindset, you CAN turn a high paying job (doctor, lawyer, engineer) into financial freedom much faster than people generally think. You just have to put that money into good use (i.e. not putting it into the hands of the wall street sharks), avoid the common scripted traps of debt slavery, and keep your thousand yard stare.

If you don't have any valuable knowledge that you can leverage for consulting, and are starting at absolute ground zero, then yes I think the eCom is probably a better path. The fundamental problems of pretty much every business are the same (i.e. how do you get sales, how do you market) so the learning curve has a similar shape for both paths, but eCom has a much easier time scaling in the long run than consulting.

TL;DR There are many different paths to financial independence. You should do the best you can with what you've got, and carefully consider the learning curve and opportunity cost of a particular path. Don't just adhere to rigid thinking - do the math and make decisions with the largest positive expectation values.

 

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[MidwestLandlord]

What @lowtek said!

I got the capital I needed to buy-in to my current gig from a job I had in consulting.

Another benefit of consulting, you are literally being paid to solve needs. Mostly needs that the people you are consulting bring to you, but, if you're any good at it, solving needs those people didn't even realize they had. (they didn't realize something could be more efficient, or they knew of the problem but thought it was unsolvable)

That's a skill that never leaves you.

 

[Hyrum]

Don't forget that your experiences as a business consultant can open more Fastlane doors down the road. If you're focused on a single industry, you may see the same issues pop up at every consultant gig. After awhile, you may find that these common problems can be solved with a training course, or a SaaS solution.

 

[Andy Black]

What @lowtek, @MidwestLandlord, and @Hyrum said.

For me, the sliding scale is/has been:

Employee -> Contractor -> Freelancer -> Agency -> Platform

I love having clients and helping people in a bespoke fashion. And I have one eye on sliding along that scale.

As a consultant, you get paid to learn an industry. You get paid to solve problems. And it's "high friction" - you're speaking to your clients rather than throwing up a sales page and not realising why people aren't buying.

Maybe you can build a team and business that can solve those problems and that someone may ultimately buy?

Maybe you train others who want to do what you do?

Maybe you uncover a need for a product or service that you can sell many times and simply (productised service or SaaS)?

As a consultant, you're engaging the market, *and* you're getting paid for it. Pretty good combination if you ask me.

Ideally, as you build up some capital and dig deeper into a vertical/niche/industry, you then "grow what you know". Consider NOT throwing away all your knowledge and connections and building a side hustle that's completely unrelated. Consider going deeper.



If you're going to "scratch an itch", consider scratching your customer's itches more rather than just scratching your own itch.


And as @MJ DeMarco said... can you get paid so that your income is divorced from your time? I consult to businesses and get paid such that, once a revenue stream is setup for them, they continue paying a monthly fee for ongoing support and maintenance.



Check out these two podcasts:

• www.tropicalmba.com/consulting
• www.tropicalmba.com/services

Also, read "Built to Sell". I did a thread with a very short video review of it.

 

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[Sheps]

Mrs jon and I were retail consultants for years near the turn of the century. It was an interesting well paying job.

Not to be obtuse here but what does a retail consultant do? It's so far from my experiences I honestly have no clue.

 

[jon.a]

Not to be obtuse here but what does a retail consultant do? It's so far from my experiences I honestly have no clue.

We conducted "high Impacted" promotional and quitting business sales. Mostly quitting business. We were Independent contractors for this company, Retail Store Closing Sales and High Impact Sales Promotion Events. This was over 20 years ago.