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Tuesday, October 03, 2006

IT Consulting Business Start-Up: How Do You Set Your Rates?

Starting an IT consulting business requires obtaining steady clients that will pay you top rates for the best service. As a full-time professional solution provider, you need to be charging competitive rates, meaning the comparable rates to those of other IT consulting businesses. If you charge way below market rates for your services, you will have a hard time raising rates in the long run.

BE MINDFUL OF OVERHEAD COSTS

Full-time IT consulting professionals know what they will need to bill to be able to cover overhead costs, but in the start-up phrases of an IT consulting business you may not pay attention to these important details. When you figure out your IT consulting rates, think about taxes, training, insurance, marketing and promotions activities, research, administrative costs and billing.

Your competition needs to charge more than $100 per hour to cover costs. They are not being greedy, rather opportunistic because their costs will total more than that amount. Even when you are a solo practitioner in an IT consulting business, you need to know what your going rate should be as an independent consultant.

PATIENCE IS YOUR BEST ALLY

You might not get to your ideal income until the second year of business. Getting into the IT consulting field is not about working 80 hours a week and pulling in $200 per week. If you are unable to cover basic expenses, you will not be able to transition from being a solo practitioner to running a full-time IT consulting business.

VALUE YOUR SERVICES

When you start an IT consulting business you have to charge what you are worth and not work for rates that are too low. Go for steady clients even when you are moonlighting. You need these steady IT consulting clients willing to pay premium rates for your best work in order to stay afloat over the long term.

Added By: Computer Consulting 101