7 Lessons Learned From Running a Consulting Company

mad men

Although I don’t do much consulting these days, I used to run a consulting company. It was an Internet marketing agency that helped small and large brands like GM, HP, Samsung, Viacom and AOL boost their traffic through search engine optimization and social media marketing.

I did it for around six years, and boy did I make a lot of mistakes. Running a consulting company is tough, and sadly it’s a lot less sexy than it seems.

Find client proposals, reports and deliverables in 3 clicks or less.

Here are 7 lessons I learned from running a consulting company:

Lesson #1: The day you sign a client is the day you start losing them

Consulting companies have a high churn rate. Some consultants claim that they have never lost a client, but that’s a bunch of horse crap. If a customer doesn’t renew their contract, I consider that a lost client.

You never know how long a client is going to last, so make sure you do everything possible to keep them. Here’s what I used to do to ensure that clients stay as long as possible:

  • Set expectations from day one – before you take on a client, you should let them know what they should expect and when to expect it by. If they have unrealistic expectations, let them know why.
  • Have a kick-off call – having one is a great way to ensure that things start on the right foot. One unique thing you can do is send your client some cookies or snacks in the mail so that they feel like they are with you during the kick-off call.
  • Weekly calls – every week, you should have at least a 5-minute call with your client. Tell them what you did for the week and see if they have any questions.
  • Send industry updates – if you are a design agency, you should be sending unique design news to your clients. If you have a marketing agency, you should send them marketing information. Sending industry related news to your clients not only shows that you know the latest and the greatest, but it also makes them feel special.
  • Monthly reports – at the end of each month, you should send your clients a detailed report of everything you did. Ideally, it should include pretty graphs and other forms of visual aids. You should go over the report with the client over the phone or in  person.
  • Monthly surveys – at the end of each month, I recommend sending your clients a quick survey. The survey shouldn’t have generic questions like “are you happy?”, but instead it should have specific questions that help you improve the quality of your work. Include questions such as “how can we make the monthly report better?”

Lesson #2: Clients are always right, except when they are wrong

You are always going to have clients telling you what they want. And although they are paying you, they shouldn’t be telling you what you should be doing.

See, you were hired because you have a specific expertise that they don’t have. This is why it should be you telling the client what is best for them. It doesn’t matter if they like what you have to say or not. Your job as a consultant is to do what’s best for the client.

If you focus on doing what’s best for them, your work will provide better results for their company.

When trying to do what’s best for your client, you will run into roadblocks. The best way to be prepared for this is to show them data that backs up what you want to do and that shows that it is the best solution for them.

Lesson #3: You’re worth every penny, so show it

Every once in a while, you’ll have clients who will make snarky remarks about how much they are paying you or that they feel they can do your job better than you can. Don’t take crap from clients; make sure you show them that you’re worth every penny.

You can do this by showing their return on investment. For example, with my consulting company, we looked at three numbers: average revenue per transaction, conversion rate, and search engine traffic. We used those metrics to show how much additional revenue we brought in through our efforts.

This shows how valuable of an asset you are, assuming you are actually providing results. The next time they are thinking about canning you, they’ll think twice because they know you actually bring in more money than you cost.

Lesson #4: You have to dress to impress

I already mentioned it last week, and I say it again: you have to dress to impress. The better you dress, the higher of a consulting rate you can demand.

When I started off as a consultant, I dressed like a bum, and I wasn’t able to make more than $100 an hour. Once I started to dress a bit nicer, I was able to go up to $250 an hour. And when I dressed really nicely, I was able to command rates in the four-figure range.

Not only does a nice wardrobe show potential clients that you are successful, but it will help boost your confidence. Plus, clients want to pay people who are successful as they hope they can bring that same success to their company.

Lesson #5: The more you charge, the less they complain

One of the first things I learned is that there is an inverse correlation between how much a client pays you and how many times they complain. In other words, the more money a client pays you, the less they will complain.

Large paying clients usually have a lot more cash, so spending it isn’t that big of a deal. They know that if they want to continue to grow, they have to spend money. And when doing so, sometimes things work out, while other times they don’t, but at the end of the day, they have to keep on making bets.

Smaller clients, on the other hand, don’t have that much money. So, if they hire you and you mess up, they usually don’t have the luxury of hiring someone else like the larger clients do.

When you first start off, you may have to take on smaller paying clients, but your goal should be to transition to the larger paying ones as quickly as possible.

Lesson #6: Fake it till you make it

As I mentioned in Lesson #5, you should be going after larger paying clients. If you don’t have a bunch of case studies or years of experience under your belt, don’t worry. You can still lock in the big guys.

All you have to do is figure out what separates your consulting company from the larger ones. Big clients typically pay big consulting companies, but if you can show why you are better than the bigger ones, you will lock them in.

At my consulting firm, I realized that clients loved the fact that I myself would work on their projects compared to the practice of bigger firms assigning junior consultants to them. Once I found this out, I would tell potential clients that I personally would be working on their projects, which they would not get with the bigger firms.

Lesson #7: When it rains, it pours

Like I mentioned earlier, you are going to lose clients. It’s just a matter of time. Because of this, you should try to conserve as much cash as possible. When things go south, you don’t want to have to fire people; instead, you want to operate off your reserves.

A few ways you can conserve cash is:

  1. Have a cheap office – my office was cheap and didn’t have windows. I also didn’t have fancy furniture, and I made sure my clients didn’t see it by only doing in-person meetings at their offices.
  2. Create a variable compensation plan – when my business was doing well, my employees got compensated well. And when it wasn’t, they didn’t. Everyone had a low base salary and earned a percentage of the profit.
  3. Keep a healthy reserve – I never depleted my corporate bank account by taking a high salary. I always left a 6-month to a 1-year reserve in the bank before I paid myself well.
  4. Don’t grow too fast – even if you are constantly getting new clientèle, don’t hire too quickly. Consider outsourcing some of your work to a local firm before you hire new employees. This way, if you lose a few clients, you won’t have to fire any of your staff.
  5. Always be closing – even when things look good, remember that someone still has it better than you. Never stop trying to bring in more clients as this will help your business stay afloat.


Running a consulting company isn’t easy. It’s a lot of work, and you have tons of bosses (each one of your clients is your boss). Although it can pay very well, at the same time it can be very stressful.

If you want to reduce your stress as a consultant, make sure you learn from your mistakes and only take on clients you can actually provide results to because being with a client is like being in a marriage. Sometimes you get into it for the wrong reasons, and eventually it hits you in the face.

So do yourself a favor, don’t get into a marriage unless you know it will work.

P.S. If you need consulting click here.


  1. Nice post! And thanks for the lessons, i really got it. 🙂
    “Clients/Costumers is king”, may be that words will be compare with the case. Our job is how to make them(client) fell satisfied.

  2. Great Post, laid back “inviting” style, yet so relevant!!!

    • Well, I am a pretty laid back and “inviting” person. I appreciate the kind words. Hope they are useful to you in your business. 🙂

  3. This is a really good post for me because I am looking to start a Public Relations Firm, these steps could help me out a lot!

  4. Keeping constant communication with the client is definitely a must, as suggested by the bullets at the beginning of the article. Misunderstandings are reduced, if not eliminated.

    • It is the only way to make sure everyone is on the same page and expecting the same things. The last thing you want is for their to be a misunderstanding between you and your client or else things could get complicated and messy.

  5. Project Manager :

    Great post Neil! I’ve finally gotten out after 10 years of consulting and I have to agree it isn’t as sexy as some people think. For me the worst part is clients that you have to regularly travel to.

    • Yep, it really isn’t. I can see where it may be tiring after a while traveling around a lot. However I always enjoy traveling to new places.

  6. Really great post, thanks for sharing. From my experience it was always tough to keep new business coming in. When you begin consulting, or any business, you never realize that more than half of your time may be going to developing new business. That certainly was an eye opener.

  7. Thanks Neil,
    some very helpful pointers here for my new website consultancy.

    Am looking forward to learning lots from my mistakes! 😉

  8. Great post. Generally trying to keep only to bigger accounts (rather than trying to grow through the “base” of smaller accounts) is very good advice. Hard to say if resisting the temptation is possible, but very good advice.

    • Thank you. Sticking to bigger accounts typically gives other large businesses a good impression. If they see you deal with bigger accounts then they will figure you know how to deal with them. It can be difficult to resist like you said, but having almost all smaller accounts can make you look like you can handle only small business.

  9. Great advice Neil! I am curious if you ever promised prospective clients specific results? Like ranking position for keywords. If not how did you approach these kind of questions? Thanks for a great resource!

    • I never promised them anything. I always provided estimates on what I think I could provide and the time frames they should expect results in. If I couldn’t provide the results I “estimated” I would be the first to cut the contract.

  10. Love the point Lesson #5: The more you charge, the less they complain.
    The clients that pay less also expect the whole world off you, and really make you work for every penny, and at times you think to your self…WHY.

    Thanks for the points. 🙂

    • Glad you liked it. They definitely do, many people who have money to spare are willing to pay more and will give you an easier time about it. While those with a tighter budget will try to get everything they can for their dollar and make your job harder.

  11. Great post. Some things I have learned from a Managment Consulting course I took, some other things were things I hadn’t thought of. I agree that it’s important to set expectations from the get go. Also as a Business Analyst, I really know the importance of it when you are dealing with stakeholders who continually want to change their mind. You have to have agreement and understanding up front.

    • No problem. Happy to contribute to what you have already studied. It is important to make sure everyone is expecting the same thing or else you could wind up in a difficult situation later on. Keep it up with the courses and reading!

  12. Very informative post! Thanks for sharing this

  13. Great post Neil! Shared it with my business partners. I’m sure it will help us!

  14. Ah consulting. It is an interesting business. I remember when I was once attending a friend’s comedy show in Hollywood and I was sitting in front and one of the comedians picks me out in the crowd and asked, “You sir, what do you do?”. I responded, “I’m a consultant”. He said, “So you’re unemployed”. Even I laughed. I suppose he was right in a way. When you consult, you are always cramming for new jobs and getting paid by the jobs you have. What makes it even more difficult is when you are younger and trying to establish yourself. Age can be a liability, it doesn’t always have to be, but in consulting young age usually goes against you. I like Neil’s creative explanation to the large companies of how expensive and established consulting firms would only assign new college grads they had hired to do the work for these corporations when if they would hire Neil (I’m sure most did) then they would be getting his full attention, effort, and devoted expertise. I am in my early twenties and have been able to get by on consulting gigs while I develop a new business. The way I have been able to get the jobs are through networks, vouching, and sales. You have to tell the client why you are a valuable ROI. Yes, I cost X amount, but I bring in Y amount, which is Z amount greater than X. It is as simple as that. Well, figuring out the numbers and strategies is a little more complicated, but the big suits only care about the simple result. Then you must produce. This formula doesn’t work all of the time either. The past few years I’ve consulted for a public school district and the local municipal government. Oh boy. It is true the private sector is relatively “cut-throat”, but the public sector is full of huge egos, bureaucracy, and people who think they are God’s gift to the world (sorry about the religious reference). Now I’m not necessarily an anti-government guy, but these people are the prime example of why government has a bad name. It takes forever to make a decision, and then the implementation takes a ton of effort in reporting, accounting, and updating. I’ve run $1.5 million in grant projects for this government the past 2 years and I did an excellent job in completing the projects if I do say so myself (I do have the “awards”). However, when I went back to them recently to increase my rates on the next project, they had a problem with it. They just could not understand the X = my new salary, Y = equals the project and the grant money, and Z = the money you save by having me run it through efficiency and money raised through available grants. To some it can be simple, to others it’s a nightmare. So to all future or current consultants; I wish you good luck and to please share your experiences like Neil has to make us all the wiser. I am switching over to the .com retail business. Also, if you are a consultant and a client calls to ask you a question, you have failed. Communicate. You should always have the answers for your clients and makes sure they have them.

    • That is funny, I would have had a good laugh too. Definitely, it seems like you have a pretty good understanding of how it all works. I agree, like you said it can be simple, because the most important thing to clients is results. But only if you get those results. Each process is different though for each deal and it can become difficult and “cut-throat.” Clearly you have been doing well for yourself so far. Thanks for your input and advice to others.
      Best of luck.

  15. sam @ goa carnival :

    Great post Neil,

    Yes one thing is very true if somebody is giving you money for their work that means he will want great expectations from you like you will give more benefits to him than others and in simple language he would treat with you like your boss because he is spending money on you for his profits.

    So better thing is that we should learn much things from our mistakes. Which you mentioned very well in your post.

    • Thanks,

      You bet. If someone is paying you for something then they are going to have many expectations. The most important thing is to make sure those expectations are laid out from the beginning. This way if they are not within reason you can say no and move on.

  16. Casey Armstrong :

    I believe I’ve said this before here, but this is easily my favorite post of yours yet, and perfectly timely. I know I need to improve some things, such as pretty reports (definitely keeps the clients happy) to show off the results/ROI, along with maybe dressing to impress at times (sandals are rather comfortable though). Thanks!

  17. Shilpi Singha Roy :

    Hi Neil,
    Great post.
    I really laughed when I read this point. ” Lesson #5: The more you charge, the less they complain” And some times its true too.., Thanks for the great post.
    Online Business Virtual Assistant

  18. Neil,
    fantastic insights! Thanks a lot for sharing these along with the great advices.

  19. Web Design Resource :

    Consulting job is always a difficult business, my lots of friend having their own consulting firm and they always say that ” whatever client says is Line Of Control”, you can not cross it. Lots of things to do before doing any consulting business. I am happy i m not in this business.

    • Whole Body Vibration :

      Then get out, its not that tough.

      • Web Design Resource :

        @Whole Body Vibration may be you enjoy this business, i m poor in this business but you are very poor in replying on comments .. Neil has explained about my doubt clearly, which is the best example of “how to reply anybody comment” need to work on it 🙂

        • Getting to every comment can be time consuming and can take awhile. It is ideal to get to each comment in a timely fashion, but if you don’t it is still important to respond even if it comes late. It is definitely something anyone needs to take the time to work on.

        • Whole Body Vibration :

          I guess I’ll work on my advice, but there are more important thing in life than internet consulting.

          • It depends on what your priorities are at the time. I agree though, it is work and there are many things more important then work.

      • I agree, if it’s not working get out and move on.

    • Everyone is skilled at something different. Some peoples strengths are others weakness. If consulting isn’t for you then it is best you are not in it, otherwise you would just be struggling and miserable.

  20. Joseph Flanders :

    Neil, I saw you on Twitter, liked what you were posting, came here and I like it even more. I’m a lawyer, but a lot of your information is very relevant to practicing law. I also like the different perspective you bring.

    • Thanks, happy to hear it. Interesting, nice to know my information is applicable to different fields of work such as your own.

  21. Rico Figliolini :

    I loving reading your posts. This really hits all the marks. The agency I work for can learn from this too. Thank you for the great straight forward non-varnished truth. Have you been married? 🙂

  22. I totally see how the more people pay the less they complain. Awesome… I really liked this article.

  23. Whole Body Vibration :

    #5 is true, but a lot of us don’t have the reputation to walk in to GM and stay pay me $1000 an hour!

    • Reputation does certainly help out, but confidence and the ability to deliver is all that counts. You’re worth what you make yourself worth and large companies will be willing to pay if you can deliver results showing you are worth the cost.

  24. You cant really compare with say marriage because its a try and see situation. No option there.

    • Every relationship I believe is a “try and see” situation like you said. When you get married you are in a binding legal contract, just like when you do business. There are always options, because even though marriages are meant to be forever, it is possible to get out of one. Same with business, if it doesn’t work out then you might end up slitting up will it be difficult and complicated, absolutely. Much like a divorce.

  25. Excellent tips Neil!

    I think setting expectations is a simple thing that will save a lot of time and effort. I also liked the idea of monthly reporting, as this is helpful to the consultant and the client.

    It would be interesting to hear about your methods of attracting consulting work and what you’d recommend to someone starting out to get work.


    • Thank you,

      Setting expectations can save a lot of time and prevent a lot of complications. If everyone knows what it is they are getting and doing then things will go much more smoothly. Monthly reporting is just a way making sure everyone is still on track and showing your clients proof of productivity.

      Thanks for the suggestion I might just have to do a post on that for you. If there are specific questions you had in mind you can always email me too at neil@neilpatel.com I’ll see what I can help you with.

  26. There is the thruth. Thanks Neil.

  27. These are such great tips. My former boss had created a great consulting business and instilled many of these truths to the development team. The constant contact with the client and the nice clothing went a long way differentiating us from other vendors to those big companies.

  28. Thanks on the tip about marriage, ouch!

    • It’s just a way of saying be carful about the commitments you make and get into because it is better to find out sooner then later that they aren’t a good fit.

  29. Web Design Halifax :

    Good tips here Neil. I believe setting up the right expectations is one of the most important things and really makes a big difference in a client that’s happy and stays and one that doesn’t.

    To add to your lessons, I find out many consulting businesses struggle to really excel because they don’t know who their perfect / ideal clients are…so find out your perfect client so you have a filtering process to engage potential clients with. This will ensure you get the clients you want to work with and will make your life much easier.

    But since you’re working with big corporate co’s. I can see how they want to run the show and some processes that work for small to medium sized biz will not work for the larger ones like the co’s you mentioned above.

    What would you say is the biggest difference in what the client wants between a medium sized business (5million and under) compared to a large corporate like IBM?

    • Thanks,

      It definitely is very important. I agree, it can ultimately affect your clients happiness. It’s always important to keep your client happy.

      That is a good point. In order to do your best work you have to be sure the client you are working for is suitable for you. Otherwise you may not be able to deliver on what they want and that will look bad on your business.

      I would say clearer channel of communication and more personalized customer service. 

  30. Lessons #2 and #7 are my favorites. As a consultant you are not being hired to be supportive (yet, the client expects that) but you are certainly being hired to make it known when the client is wrong. That news can be delivered diplomatically, but it must be given ASAP.

    #7 about rainy day funds. Well, that is true for any business with volatility. Most firms go out of business because of the obvious, they run out of money. Our government faces that dilemma.

    • Very true. You want to let a client know when they are wrong but in a way that won’t come off insulting. The sooner you make it clear the easier your job will be.

      Saving money is just a way of always having something to fall back on if it all comes crashing down. It is something you must do if you want true security.

  31. Great work Niel !!

    All seven mistake always truth,These are very helpful for me as I am going to open my own concsultancy services..

    Thanks you very much 🙂

  32. #5 is especially true with sales too. I find that the smaller companies with smaller budgets are sometimes the hardest to close and are the biggest leach for information. They kick the tires a lot before they buy.

    Neil, you always have great insight and information. Thanks for sharing.

    • Yep, it can be difficult to work with smaller companies because they have a tighter budget and want to squeeze every drop they can out of what they paid for.

      Anytime, thanks for commenting. 🙂

  33. This is so true – I’ve had the pricing issue for a long time, but I’m getting ready to raise the roof – eiher you are or are not going to do business, and this is what superior service costs!

  34. Niel,

    With your experience, what do you think of consulting as a scalable business model versus Kissmetrics or Crazy Egg which is more transactional?

    • Consulting really isn’t scalable. As you add more clients, you have to add more people. I used to be a consultant and I prefer scalable businesses like KISSmetrics and Crazy Egg.

  35. Nice Neil. I think the most important tips with consulting is: 1) Set expectations and boundaries at the start; 2) Learn to say “No”; 3) The higher your rate, the more clients will respect you.

  36. Neil,

    This is a great article. i am not a consultant myself and i do not think i will ever be, but the principles you have high lighted here can actually be applied at any business or servicing business. I own a service company, that supports the Oil&Gas industry, and i can certainly say that some of your principles apply to our industry.

    Thanks for sharing your experiences mate.

    • I appreciate it,

      Interesting, glad to know it was of use to you even though you are in a different field of work. I hope what you learned is able to benefit you in your business.

  37. Neil great post! Love your first point.. The day you sign a client is the day you start losing them. Seems like many clients will use your services and then just ditch you when they see some success. Have a friend who just lost a client because they saw successes and didn’t want to pay their monthly salary. Sad how that happens, even though their was a bunch of success, they thought they didn’t need the guy anymore. I think he’s going to start his own ecommerce site in the same field though since they had no ‘non compete agreement’

    • Thanks! Definitely, the seconded hardest part after getting a client, is keeping them. You need to make them realize the only reason they are seeing that success is because of the work you do.

  38. Neil,

    Having been a consultant myself, I can totally relate to everything you wrote here. One of the biggest things holding me back in my business was charging too little for my work. You definitely need to charge what you are worth and even charge a little more than that. You still get clients, but you are happier working for them and you do a better job because you are stoked about the money.

    • Glad to hear it. Absolutely, you are worth what you make yourself worth and clients who you want o be working with will be willing to pay. I agree, you will feel better and do better work when you are getting what you are worth or a little more.

  39. Nice summary. It’s good to get a dose of reality. Really like and will adopt the point about letting bigger clients know they will be getting you and all your expertise (not a junior).

    • Thanks, I hope what you picked up will help you become more successful and better paid too. As long as you can deliver results.

  40. this blog has been really vry much benefetial to the small cobsulting firm like us.

    Thanks a lot and keep posting

  41. Some solid advice here. After every client I remind myself I need a stronger contract….

  42. Man, I’m fully feeling you on #2 & #3 and need to be doing more of #5. Based on recent history I’ve already decided that except for my true friends I’m never lowering my fee again. It seems like every time I’ve done that I’ve been burned in some fashion, which to me means they’re not valuing the work I do. That’s going to change for sure.

    • Thanks, it definitely makes you look less valuable when you ask for less. I hope you do change it and value yourself at what you are worth.

  43. Terje Sannarnes :

    I would like to say that running a consulting company has its own distinguishing peculiarities. It should be noted that lessons shared here are efficient for other types of business as well. So, it makes sense to read this post carefully. Most of all I liked the advice “Client’s are always right, except when they are wrong”. A successful entrepreneur will never show his/her clients that they are wrong. This rule is especially effective for business owners.

  44. One most basic QUESTION… I have many skills about web apps and servers, HOW can I actually start a consulting firm? How can I identify that this guy will need consulting. I’m facing a starting problem. 🙂

    • Most people do. 😉

      You just have to start. Create a website, call companies and ask if they need your services… do whatever it takes. As you start you will run into roadblocks and you’ll end up figuring it out.

      Hope that helps.

  45. Neil.. anyway you can write a post about getting guest post on solid sites. Many sites like Technorati require you to show examples of your past work, but if you are just starting out, you have no past work to show and then therefore cannot get on those sites.

    Plus if you have any tips for beginners and non beginners on how to accomplish this? By using Ghost writers?

  46. I liked following under Lesson #2: Client’s are always right, except when they are wrong.

    …This is why it should be you telling the client what is best for them. It doesn’t matter if they like what you have to say or not, your job as a consultant is to do what’s best for the client….

    I had run into this numerous times where a client’s resource demanded or asked for something which was not good for the business. As consultant, I had to convince the person by documenting the facts, data, architecture and results showing the result / outcome.

    A doctor shouldn’t give poison to his patient, even if they ask for it. The same way, consultant should not deliver a client things not good for the businees.

    I learned it in Quality Management during my PMP.

    It was a very nice article. Thanks for sharing.

    • It is a favorite of mine as well. Yep, that is part of the job. Nice comparison I would hope that no doctor would ever do that. Thanks, I glad you liked it.

  47. perth internet marketing :

    Great article Neil! I believe your Lesson #1 is indeed the first thing that must me settled. Impressions are very important but setting expectations for clients are too as well. It’s the real key to start the business relationship and if you mess up step one it’s hard to keep thing going well.

    • First impression can make or break a business deal in a lot of cases. It can show how much you value yourself ay as well as how much they should. It can be difficult to smooth things over when if you mess up, but you should always try and only move on if it truly isn’t worth your time.

  48. melbourne internet marketing :

    Yes, it’s so true running a consulting firm is a stressful job. You right when you stated things will eventually go wrong. One just need to prepare for its eventuality. Great points on how to soften the impact of the difficulties to be faced. I really like lessons #7 and #1.

    • Things usually do go wrong every now and then. Nothing stays perfect forever. The true test of talent and success is how you deal with those difficult days. Preparation is key to everything and could ultimately save you. Thanks, I hope it helped.

  49. sell used textbooks :

    Ah-ha! I’m glad you brought up the dress to impress again. That one’s a biggy for me, so of course that’s the one that I noticed first. But my favorite one out of your list in this article is the one where you tell your clients that you will “personally” work on their project. This is just me talking, I can’t speak for anyone else, but I really like when the person presenting a proposal to me says they will “personally” handle the details that we’ve just discussed. Conversely, it irks me to no end when I spend lots of time with someone, and in conclusion they tell me that so-and-so over in such-in-such department will be handling the matter. Neil, another really nicely done article!

    • Good, happy to hear it. It is a big for most people. It is better for business when you handle most of it personally because it is you who is making the deal and speak ing with the client. So it is you who they are hiring and trusting to get done what they are asking.

  50. The best mistake, i maid during my first telephonic conversation was, I told my client what is my charge before telling him the Pros of my services and ROI that big consultancy companies may not offer, and lost.

  51. While I don’t nor have I ever ran a consulting company I am a freelance and can related to some of your issues. I have made so many expensive mistakes that it has nearly killed me. It’s nice to know there are legions of people out there experiencing the same hurdles!

    Great Post
    Great Site
    Thank you


    • All mistakes are just lessons. Everyone will make mistake. All there is to do is understand why it failed and then move on keeping those mistakes in mind.

  52. Thanks Neil!

    These points definitely helped. As much as we know them its always good for someon to reiterate what really works! Am in the process of starting up one such Online Marketing firm myself and these pointers certainly are a takeaway!

    Keep Posting! 🙂

  53. Great post! and it is very informative and useful. Thanks for sharing

  54. wow! As expected from an expert. I could learn everything from you when it comes to business. But what I love is number 2. I think mostly companies I know lack this one. Mostly they say that clients are always right and you should always say yes to them. I know what they mean but to the extent that not showing why you are hired is wrong. Thanks for an eye opener, neil.


    • Thank you I appreciate the kind words. It isn’t about the client being right, it’s about keeping the client happy. In order to do that you have to be able to tell a client no when something they want won’t work. Then explain to them why that is and what will work.

  55. Really an informative post. Thank you very much for sharing it 🙂

  56. Hey Neil informative post and thanks for sharing such an useful lessons.

  57. Your bit about not letting the client how to do your job is spot on. If someone goes to the hospital for a surgery, do the tell the surgeon how much anesthesia to use? Of course not, they trust his opinion. Any consultant should be trusted the same way.

    • Definitely,

      Nice comparison, I enjoyed it. They hired you to give them advice and you need to remind them to take it. Thats why they pay you.

  58. Hello there,

    Thanks for sharing.

    On the issue of having a cheap office and then making sure they don’t see it by conducting personal meetings elsewhere, how do you conduct consumer acquisition processes? Without a prominent office, I’d think you only have presence on the web & perhaps through e-ads. Then again, what do you think a traditional consulting company should do? By traditional, I mean consulting companies that offer consulting services to non-web-based companies, companies with physical presence in the country.

    Thanks in advance.

  59. Hi Neil,
    thanks for the stuff on hiring. i did these mistakes in past. will keep in mind next time.

    • Yep, no problem. I think most people make these mistakes at one point or another. Keep these tips in mind and you will be better off.

  60. Outdoor Furniture :

    I would like to come in with my knowledge of working in different companies ( I’ve been a contract worker for years with various companies and work environments) with different people, and recommend a more human one on one approached between management and employee.

  61. Outdoor Furniture :

    Thanks for sharing this nice information.It is really very interesting blog.thanks for this nice post.i like it very much…

  62. Charlena Baruth :

    Hey there! I know this is kinda off topic but I was wondering which blog platform are you using for this site? I’m getting tired of WordPress because I’ve had problems with hackers and I’m looking at alternatives for another platform. I would be awesome if you could point me in the direction of a good platform.

  63. Alex @ Easy ways to make money :

    Thanks a lot for this post Neil… especially your advice on “not growing too fast.” I know it can be tempting to expand your business when you know you’re doing well and having a constant stream of clients. This type of situation happened to me before and I learned a lot from my mistakes… Taking one step at a time even if you’re business is flourishing is a good way to safeguard the future of your business.

    • Yep, you want to make sure you don’t get to carried away when you first start off. Glad to here you were able to grow from your past experiences.

  64. Internet Marketing :

    Lesson # 4 is definitely left out most of the time. People tend to just show what they are made of on production basis but how could you let a client believe or sign up with you when you can’t express them on their first impression? They may say it is deceiving but dressing nicely is one of the key points to get clients FIRST.

    • Definitely, first appearances are critical regardless if you realize it or not. People say what you see is what you get. So make sure they see success.

  65. Like you mentioned in #7, running a business reminds me of a roller coaster. Some days are phenomenal when you are booking multiple clients in one day, and some weeks suck when you loose multiple clients in a week.

  66. Reiki Bedfordshire :

    Do people actually take note of what you, as a consultant tell them? In my experience when a business needs a consultant they are usually too far down the drain to want to take advice.

    • They do and they should.You can usually bounce back as long as you know what to do to fix your problems. Which is why they typically hire a consultant in the first place.

  67. I have had few client who paid less and complained the most. I always tried my best to carry on despite our bed time fights and If it continued for long then I had to consider closing down the project. But It happened in early days of my career. Now I choose my client very wisely.

    • That seems to happen a lot with clients who have a tighter budget. Glad you learned which clients work best for you. You always want to have a decent relationship so that way work can be easily accomplished.

  68. Yasir Khan Quantum SEO :

    I’m impressed Neil!
    This post is something which is probably the crux of your life experience.

  69. This article helped me on my first ever Casa Analysis homework….Thank you very much….

  70. Hi Mr. Patel,

    Thanks for the wonderful advice, it was very helpful. I am currently a double M.S major in Operations Research and Engineering Management the techniques are all about optimization and better decision making for a business. I haven’t started working yet still a student and I do have dreams of opening my own business in this field. For my field how much of a demand would I be in the market?


  71. hey neil,
    i really liked this lesson ” You have to dress to impress”. i actually believe in it. and of course you have practiced this as you told. it’s a very impressive article.



  72. good stuff! thanks for the tips!

  73. Hi,
    Really great post, thanks for sharing. From my experience it was always tough to keep new business coming in. When you begin consulting, or any business, you never realize that more than half of your time may be going to developing new business.

  74. I loving reading your posts. This really hits all the marks. The agency I work for can learn from this too. Thank you for the great post,,,,

  75. I thoroughly enjoyed reading this post. I am in the process of planning to open my own PR consulting firm, and this is precisely the type of advice I need. Thank you – truly.

  76. Neil, I would like to understand dynamics of consultancy business especially in area of business process reengineering where i am specialized.

    Is there any way to get further on tips from you. Thanks a ton for nice post!!!

  77. Hi Neil, i had great learnings from your article. I have just started healthcare marketing consultancy firm. Your article has given shape to few of my thoughts. I feel, biggest challenge is to get clients. if you don’t have any, you are busy without business. Currently, i am in that struggling stage:(

  78. Hi Neil,
    Informative post and thanks for sharing such an useful lessons and wonderful advice.
    Clients loved personal attention for their projects *Lesson #6*.

  79. Very fruitefull article. Me and my husband are planning to start an audit and consultancy firm. Your tips will definitly help us in various ways. One question, is it necessary that a consultant should be more talkative than his / her client? i m not good in exegerating things i am very precise in every matter… plz advise

    • Best of luck to you guys. I think you should just speak with the knowledge you have, no exaggeration needed 🙂

  80. Neil,

    I truly enjoyed reading your post. I am in the process of starting a non-profit and I would love your feedback, may I request you on linked in?

  81. Hi Neil,

    To go through your study was really an informing session. Since i am starting my consulting business very soon, this study will help me in dealing with clients.


  82. You are very right Neil, I have found out that majority of my clients are the ones who pay less. As a result, i have a fixed rate and I have been better off. Atleast now I know the stress is worth it.

    • Adegboye, the stress is definitely worth it when you have the opportunity to communicate the way you want.

  83. Neil, great article. i have been an avid reader. i really need help in terms of how do you start finding and pitching to the right clients, or even to prospects. the challenge i have been facing is of getting connected to the right people and getting a start. I am confident, that once i can break in, i could get through.
    any suggestions would be great.

  84. Neil,

    I love how you have covered a broad spectrum of advice on consulting here. As a seasoned consultant I agree with all of them. The biggest lesson that is missing (and addressed well with examples in Freshbooks latest ebook) is this, always conduct an assessment or meet-n-greet session before you divulge your rates.

    In your preliminary session, you can learn the client’s budget and specific concerns by probing them with well prepared questions before you commit to your rate. The session will also give them an indication of your capability and breadth of knowledge. Also always be thinking packages instead of hourly rates.

    Great read!

    • Kay, glad you enjoyed it. Thanks for sharing your insights. I think packages really push the needle for any business.

  85. Sangita Singh :

    Awesome article. .Well, I also run a HR Consulting company..am sure some tips gonna help me out ass well. I enjoyed reading it. Also, “The more you charge, the less they complain” was amazing..

  86. This is one awesome article! An opportunity fell into my lap for a consulting gig where I live, in Barrow, Alaska, and I’m glad I came across your article. I really appreciate learning from all of the comments and responses too. The only thing that doesn’t apply is the dress code. I love going to board meetings for a 2 billion dollar Native company where they wear a nice shirt and jeans and only the visitors wear suits. And I thought $115 was a lot of money until reading your article…
    Quyanaqpak! (thank you very much)

    • Mary, glad you found the article helpful. I have always believed in the philosophy of “to each their own” — you can wear whatever you want to a meeting as long as you have great ideas and show a passion 🙂 . Thanks for your feedback and I look forward to hearing more from you!

  87. Great article. On the dress to impress lesson. Does that also apply to the car that you drive? Would a consultant in a 1 to 2 year old Mercedes be perceived better than a consultant in a new Toyota Camry?


    • Kevin, I really don’t extend it to cars. I think cars should just be reliable. I think the way one dresses though is important in seeing how well they take care of themselves — in most cases.

  88. Neil, this is outstanding information. I’m retiring from the military in less than 2 years. My plan is to utilize my 20+ years of experience as an officer in the military as a consultant. In particular, I would like to focus on management consulting. I have a few additional questions that I would like to present to you, if possible. Again…absolutely GREAT information!

  89. Great article Neil… I had my own consulting firm. It’s very challenging and like you said sometimes we need to fake it out. Every lesson in here has been very well written. Even for those who are planning to start a new venture, not only consulting, this article helps a lot. I am planning to expand the firm now, but your article has made me to think numerous times before I could come to any conclusion.
    Hope to see you posting more & more articles.

    • Nikhil, I definitely think you are on the right track because you are voicing the right concerns. I think with a little patience you will see greater success. Keep up the great work and keep doing all the right things. More articles are on the way!

  90. Madhsudan Dadhich :

    “A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider in our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us an opportunity to do so.”

    • Love the quote. Thanks for sharing!

      • Madhusudan Dadhich :

        Most welcome, I’m finding a lot difficulty while approaching a new client can you please help me out with any idea that how should I talk to them so that they give me a chance to serve them.

        I’m working in a HR consulting company who supplies manpower to different companies to close their vacancies at earliest at the cheapest price available in market.

        Also its really difficult to call and shortlist the candidates and get them interested is their any other way out that by posting adds more number of candidates approach me I tried in lot of classifieds but none of them is successful upto my expectations.


  91. antalya havaalan? transfer :

    Exceptional submit. I became verifying frequently this blog with this particular astounded! Helpful information and facts specially the remainder period 🙂 I handle similarly info lots. I used to be searching for that certain info for the period of time. Thank you and also all the best ..

  92. Great information Neil. My main question would be that if its a new consulting firm. What would be the best way to approach our first clienteles? Till we build trust and form a relationship to last.

    • Neil Patel :

      I would hit up companies in your local area and manually pitch them. Do this in person… I know it is a lot of work, but you need a few clients to create case studies from. 🙂

  93. No Offence, but Sir, You are full of BS, This Article was a bunch of Baloney and nothing more

  94. Attractive component of content. I simply stumbled upon your web site and in accession capital
    to assert that I get actually loved account your weblog posts.
    Anyway I will be subscribing for your feeds or
    even I success you get entry to persistently quickly.

  95. Good article on consulting. Nice to hear real stories that make a connection between Internet marketing and consulting with big brand named companies.

  96. Nice post. Great consulting experience and insight.

  97. This is a must read article for anyone who thinks about starting a consulting business. And you said it best at the beginning of the article “sadly it’s a lot less sexy than it seems”.

  98. Hi Neil,

    I find your article inspiring. I am currently a student I took a course in digital marketing I know all the theory but need help with implementing all this theory. Maybe you have some guidance or tips you are willing to help me with?

  99. Your article is interesting and amazing so far. Thanks for sharing this article, it helps many people who thinking about to start a consulting company
    also i recommend a consulting company:

  100. Hi the above post is very good.pls tell me how to manage employees in work place when they are not reaching the target.

  101. great post very helpful and informative

  102. Neil,
    I’ve recently been offered a consulting position as a potential segue into a permanent position. However I’ve never consulted before…have no idea how to set expectations, agree upon project deadlines, or establish base rate of pay. Can you recommend some resources for someone new to this world?


    • Jeff, best of luck — what an exciting time & I am sure you will do great.

      Here are some blogs that can help:



  103. Thanks for the article Neil. Been a fan of yours for a while but now finally want to go into consulting: Marketing, Accounting and Tax. This article is a real blessing. God bless you.

  104. Warren Cowley :

    Thank you for the advise. I am thinking of entering my market in South Africa as a consultant. I like your idea about the cookies, alot of people overlook the small things like cookies but I know working at my current company, when we use consultants, the small things like them offering you coffee or a tour and keeping you in the loop with weekly/monthly meetings creates a favorable impression.
    A balance of been good at what you do but also the soft skills like creating friendly, warm sessions with your clients is key

    • Warren, sounds like you got it right! It’s all about creating a relationship with your clients to make sure they feel comfortable and that their concerns are being heard. Looking forward to hearing much more from you. Thanks for sharing.

  105. Manpreet Kaur :

    Great post and quite useful.
    Keeping rainy day savings in your bank account are really necessary, especially when you’re working by yourself. When I started out with my blogging and social media work, I would use every penny I earned and as one can expect, there was a time when I earned less than my essential monthly expenses. That was really tough and hence I learned this lesson the hard way.
    Since then, I have been working on building a big rainy day fund before I move on to buy all the stuff I think I need or just want to buy. Your post will work as a motivation to keep working on those lines and get prepared before it starts raining. 🙂
    Thanks for this great post. It gives out the best lessons as always.

    • Manpreet, it definitely is smart to always keep a rainy day fund. You never know what will happen. Why do we earn? To save and enjoy our hard labor another day 😉

  106. please what can a consultance company had to advise his /her client that have some amount of money hanging as debtor position and the client need a little money urgent to replace a warrant of machine

  107. Hi Niel, Thanks for the advice. I am starting with a consulting practice and it is comforting to know it is not easy by itself and not than only me is having a hard time 🙂

    • Doing something by yourself can definitely be hard and sometimes difficult emotionally. Think about partnering up with someone in a similar position as you and merge your businesses. Check out this post on finding the right business partner: https://www.quicksprout.com/2009/11/04/finding-the-right-business-partner/

      • Thanks a lot for the advise. These times I try to complement my services with closely related consulting startups as mine and freelancers. So we invite each other to deals and recommend leads.

  108. Neil,

    I’m amazed at how prolifically helpful you are with your articles. How in the world do you do it??

    Anyways, after having experienced a lot of the “downsides” of what you mention in this article, I quickly determined I needed a better model. I needed something more systemized.

    Exploring this path I came upon the term “productized consulting”, meaning you figure out a set suite of services that a set group of businesses need, and then offer that.

    I think of it like pizza. I offer pizza to people who need pizza, and since I only focus on pizza, my pizza is the best. Yes, you can get it slightly customized with a different topping, but underneath it all is pizza. Most consultants are like “smorgasboard” restaurants. How confident are you that a place that serves sushi, fried chicken and pork fried rice will also have the best pizza you’ve ever tried? Not very. You want the best pizza? You come to MY restaurant.

    So if you apply that idea to consulting, you get a “productized” service offering. Meaning it’s less customized (just the toppings), but it’s the best at what it is. So if you are a business consultant, maybe you have a set process every client goes through. You have THE best ___ process. If you are an SEO consultant, you have your own specialized “proprietary” process that every client goes through, and set of deliverables that every client gets. And if they ask for web development, you send them to a JV partner. The fact that it’s not 100% customized is actually better for them too. You are saying, “hey, I’ve already figured out what works. This is a proven system. Customizing it is actually riskier than giving you what already works”

    I’m in the process of figuring out my productized consulting offering now. That means surveying the market to see if they really do need pizza or if they need something else like sandwiches. Then, sure, I will offer them the best type of sandwich for their situation, but only sandwiches. No steak.

    Approaching consulting this way I think will help side step a lot of the painful issues that come with consulting. That’s the idea at least!


    • That sounds like a delicious.. I mean great approach 😉

      And something to add, always focus on doing the thing that brings you the most joy and satisfaction. The more enthusiasm you have for what you do, the more clients you’ll attract that want your help in doing it.

      • That is very good advice. Funny how we sometimes overlook that part…arguably the most important “ingredient” of all, in the bigger picture.

        I guess I’ll be selling Pho, not pizza then!

  109. Franchesca DAvis :


    Is there a way we could chat offline? I want to start a consulting business but this is all very new to me. You offer great advice but would love to discuss further

  110. Thanks fro the tip

  111. Boomy Tokan :

    As far as I am concerned Neil writes some of the most amazing and actionable content I have read in a long time. I am increasingly becoming a fan!
    I am looking forward to learn more from Niel. Boomy

  112. Dimitri Flores :

    Neil, today I had to read this article again because one of my first clients is dumping me with the argument they have not seen improvements in their business. There are plenty of course and I can and will remind them. They just became business as usual and nobody remembers that is was me who recommended things and showed the way. Thanks again for a great piece of timeless advice.

    • Well hopefully you were able to gain some valuable experience and insight from this experience. You will only get better.

    • Dimitri, I’ve been there and you can typically cut that short. I’m a growth consultant and typically these small businesses only focus on the bottom dollar. They never look “between the bucks” as I say and that is…

      A. Are your clients still doing the same ol thing you suggested not to do first?
      B. How long has it been since you first consulted with them before they noticed no improvements?(I see this all the time too, they expect after 24 hours, they should be making $48,000 from the prior $15,000 they currently make)

      C. Are any of your clients utilizing what you teach?
      D. Are YOU following up with them? They are not remembering you so you gotta stay more on top and stand your ground. Let yourself be known like the Greek Gods. 😉


  113. This is the most awesome post I’ve ever read. I never read any blog posts because the majority of the time it’s bullshit. They work at mcdonalds and blog about how to be a better consultant… GET OUTTA HERE!!!!! When I ask where di you work, they say I haven’t done this in 10 years… Dude really? This nails everything and I also give credit where it’s due and that’s thanking you big time for not once bringing up “How many certifications” and “Degrees” and stupid stuff like that that does not matter to how much KNOWLEDGE YOU HAVE IN THE INDUSTRY. Man if I met you, I want an autograph and we need to go throw down some beers

    • Thanks Anthony. You will know you have the right mentor when you are enjoying the experience you having as they demonstrate their value. As for beers, how about the next time we run in to each other at an event

      • Neil we should talk seriously. Shoot me an email man and I surely will be sure to pay for some throw downs. 😉

        Just got my email up and running finally and have taken on some fairly large clients but can really use some sort of way to push my word to more and so I started setting up alkl kinds of networking meetings through meetup.com. This is a sureshot way to push your word our and has made one heck of a turnaround for me. $80.00/20 day trials. People see potential(Hey when you started a full time business with no loans and no help and a black and white printer, your liable to have some experience and intelligence). They go for it, I produce the knowledge for them and if they want to extend and continue, then boom we discuss the real price and I typically say “Hey, your price is not $x,xxx to make more money, your price is the money you want to make. So what’s what’s more expensive?”



        • Sounds like you definitely have the hustle inside of you Anthony, love it!

          I speak at a lot of conferences, that you may be attending, hopefully we can meet one of these days!

  114. I have read a lot of articles and I still have a question that has still not been answered.
    How exactly do I get clients? For my consulting business? Should I just keep advertising and hope someone would be interested one day? What do I do?

    • What kind of consulting business do you have?

    • Hey Laura, the best way to get started and I’m not joking…. You have to promote yourself. People are getting tired of reading blogs and Imma tell you right now, Facebook copy/paste advertising methods do not work effectively. Twitter, linkedin… yea no those don’t eithier. They have way to show people BUT if you want to really push out. You are going to have to save only a mere $100.00 ONLY FOR MEETINGS ok? follow me…

      Jump on meetup .com and start setting up RSVP’s on the netwkring meetings that’s worthy for you. Don’t randomly select just anything and call it a day. Find small business startup groups or so. Me, I’ve walked directly into businesses and said who I was, stood my ground and the company has depleted all of my services including using my point of sale app developed by me. You have to be patient.


    Hello Mr. Neil,
    Its really very useful points which will be very helpful for my new consultancy business.

  116. Sarah Choudhary :

    I used to work for consulting firms for last 6 to 7 years. My mind got the pieces of advices I find in this post. This is so true, working as consultant to manager for consulting firm make us very firm believer that we are always in trouble especially lining up with the timelines and updates. That hectic routine was not enough for me. I startup my own consulting business. Though I am startup fish in this industry and looking for wonderful advices. This page is very helpful. I definitely will keep in mind and practice these lessons.

    • There’s a great deal of opportunity for you on the web. Let me know what you decide to do and if you have any questions I can help with

  117. Just put yourself in the client shoe, they are business men and women who want their investment to have payout

  118. step up shine :

    Whatever you wrote, it is appreciable but ow could you write – every client is a boss? Is it real? Not for me.


    Thank you for the positive advice. I’m working as a freelance business consultant for startups and I’m planning to take it to the next level to have my own consultant office. that was very helpful especially with the pricing part.
    Thanks Neil

  120. Gibran Munozcano :

    I have been trying to figure it out what is the average churn rate for a Consulting Company? what is acceptable in the industry. I know for a SaaS it is 7% or less annually.

    • Sure you can find average churn online but try to see beyond averages and aim higher 🙂

      • Gibran Munozcano :

        I have looked and I cant find it… would you mind sending me a link… or in your case what is your churn rate.

        • Neil Patel :

          I have too many ways to consider churn but I would focus on what you want it to be more than what others have achieved.

  121. Gibran Munozcano :

    As you know in order to set a goal it has to be a realistic one. For example I can say that I wan to run 100 meters in 6 seconds…. that’s impossible considering Usain Bolt can’t event do it under 9 seconds for the past 3 Olympics. So in order for me to set a target for our Consulting Company I need a Benchmark. That is why I reach out to you and other Consulting companies. if you want you can email me directly. I’m in the middle of helping reorganize our own workflow and this is a very important point to figure it out. Any help would be very much appreciated.

  122. Neil,

    Fantastic article..i have been consulting for 7-8 yrs now

    but only for other firms..
    have a q : Can i start my own consulting firm S-Corp and i be its
    1st employee ( and can i pay myself..)


  123. Thank for sharing Neil. I realize that consulting is not always the easiest business model. I’m pretty new to consulting and I’m currently in the process of writing the curriculum for an 8 week growth strategy course. Up until now, I haven’t actually landed any paid consulting clients, and right before I finished with week two of my training content, I get a Linkedin email from an insurance company that’s looking to hire a marketing consultant. And now the main thing that’s stressing me out so bad is exactly how to price my services in order to win this client’s business. I have hourly rates, monthly retainers and program packages, and I’ve been told by other consultants to never charge by the hour and to instead charge by the program, which is what I’m currently doing, except my program is not yet completed as far as content is concerned.

    And so now I’m kinda forced to charge by the hour or by monthly retainer. I guess what I’m saying is please tell me what I need to do in order to get over the fear of pricing my consulting services. I currently have block rate pricing and I also have my hourly rate based on my previous jobs. My block rates range from $135 – $200/hour depending on how many blocks are purchased, and my hourly rate based on my resume is around $65-$100. I know as a consultant, my rates are much higher because my program is really worth that much more than what I would usually do in a full time position.

    So I just don’t wanna tell my prospect a price without knowing their max budget upfront, which I think is what I’ll be asking them first. I also don’t wanna get locked into tracking every hour on Quickbooks, but I will do it if I absolutely have to. I want to focus more on providing a program with set monthly rates, expectations, frequency of phone calls and other things but I’m stuck on exactly how to price it and present my offer in order to land this new client. Please help Neil.

    • It sounds like you know what you’re worth. If you’ve done the research and you know what other similar consultants are charging, you should feel confident about giving your new client your price list. You can also ask the client upfront whether he or she would be more comfortable with an hourly rate or a retainer.

  124. I’m in partnership with a new consulting firm and very nervous; I appreciate the advice it helps.

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