“I’m considering becoming a self-employed consultant. Do you have any recommendations on self-employment in the current economy?”
Self-employment in this economy is not impossible, but it does require hard work and a strategic approach. Consultancy can prove to be a very lucrative career path, however, there can be uncertainty in whether you’ll close the deal, get a contract renewed, or maintain regular clients. Here are four tips on what you should do before quitting your job to become an independent consultant:
EXPAND YOUR NETWORK. Ideally, you want to be consulting in a field that you’ve been working in for quite some time or have some degree of experience in. Also, you should have established relationships with colleagues, companies, and experts in the field. These relationships could potentially result in future business deals for you as a consultant.
Before you take the step toward working for yourself, it’s important that you have a significant network of individuals or businesses to support your vision. It’s difficult to get work as a consultant when no one knows who you are or can vouch for the great work you do. Growing your network will be the most important step toward self-employment because you’ll start off with a base of professionals who can attest to your skills based on past experience.
Grow your network by establishing and cultivating as many relationships as you can with key stakeholders while you’re still an employee in the field. Once you move on, people will remember who you are.
DRAFT A FINANCIAL AND BUSINESS PLAN. Because consultant work can be uncertain, it’s extremely important you have saved enough money to make it through times when work isn’t pouring in.
Before quitting your job to become an independent consultant, be sure that you’ve saved at least six to 12 months of living expenses. Yes, this may be hard to do in today’s tough economy, but it’s a sacrifice that must be made. In the event that you aren’t able to save this much money—maybe you were laid off)— the alternative is to create additional streams of income while trying to get your consultant work off the ground. If you have a hobby or talent, turn it into a side-hustle and make extra money doing things that you normally would do for free. Clean out your garage or attic and sell some items on eBay. Become a substitute teacher, a dog walker, or a secret shopper.
Do whatever it takes to generate income while you remain focused on your goal of becoming an independent consultant. You’ll reap the benefits soon enough.
Also, create a business plan that takes into account expenses for marketing, travel, technology, taxes, and other essentials. Know your rates and standards for doing business beforehand, and set goals for yourself in terms of profits and revenues.