Small Business Computer Consulting

Business income is determined by business inputs. This having been said, so many beginning computer consultants want to know what they will make in the first year.  They try to base their business decisions on what they think an average business income will be.   

We can’t tell you how much you’re going to make. Your business income is dependent on so many variables that it is impossible for us to predict.  What we can tell you are the variables that are within your control.  Ask yourself the following questions and then analyze your self and your performance.  With your answers you can make plans to maximize your business income.

• What is your schooling and work experience/knowledge?  Credentials can help win clients and increase business income.    
• How selective are you when accepting clients?  If you take on anyone, you will inevitably end up working with people that are difficult and whose problems make your life miserable.  The business income generated ends up being more trouble than it is worth.
• What is your personality or temperament like?  Do you get stressed and frustrated easily?  What is your demeanor when dealing with clients?  You need to be calm and professional at all times.
• How much time do you spend making sales calls?  Even if you hate doing it, this is a necessary activity for earning business income.
• How well do you handle follow-up?  The sales call or initial contact is just the start of a potential relationship.  You will lose much business income if you fail to follow-up on your leads.
• How aggressive are you with your marketing activities?  The more diverse your marketing strategies, the greater your reach.  
• How good are your business partnerships with other advisers?  Often overlooked, this is critical for maximizing your business income; not only from a networking perspective but from the knowledge and wisdom you will gain.  

The Bottom Line on Business Income
Your business income is almost entirely in your hands. There are no average numbers because there are no average business owners.  What you put into your business will be the deciding factor in how much business income you will generate.  Look at each of your business decisions with business income in mind and then formulate a plan to make the most of the resources available to you.

In this article, you’ve been introduced to business income. To learn more about how you can improve your knowledge of business income, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

As in any business, a computer consultant will do some learning by trial and error. One of the key elements of a successful business is having the right clients. Sometimes your "ideal client" will change over time, so periodically review your client list.

Read on to learn how one of our computer consultants benefited from others’ learning experiences:

"I streamlined my client base. 2005 was my first year entirely without a client who had been my largest in 2003. They were a source of significant revenue, but they were also extremely demanding and paid less than half my regular hourly rate. They were also the largest source of complaints and ‘off-hour’ demands.  Since they would not allow me to send in a subcontractor or employee, I was stuck with the choice of spending all my time nursing half my revenue, or changing the scenario. I gradually weaned this client in 2004 and entirely removed them from my client base for all of 2005.  My revenue grew measurably as a result. One thing I learned from the Computer Consulting Kit was to look at each client, their revenue for the year, and decide who and what to focus on. This brought me $23,000."

Robert Rains, Gibraltar Systems Computer Consulting
Lowell, Massachusetts

The Bottom Line about Computer Consultants

In this article, you’ve learned about computer consultants. To learn more about computer consultants, click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Marketing and promotion expenses are one of the bigger outflows that you need to contend with. From the start you should be thinking about putting aside cash for marketing and promotion expenses on a regular basis. If you manage it properly, your marketing and promotion expense is more of an investment than an expense.  

When you start planning your marketing and promotion expense, you should think about tracking every dollar that you put in.  Not every campaign you run will be a winner, but you should be able to track it nonetheless.  That’s the trick to managing your marketing and promotion expense.

The tracking is key because there is no one sure thing. There is no one thing that works 100% of the time.  If you want a sure thing get a job. When it comes to marketing and promotion, you need to try a lot of different things.

When you think about your marketing and promotion plan you should aim to have three, four or five balls in the air at once. Have three, four or five different marketing vehicles going at the same time. Out of the five things that you do, one will wind up being a huge winner, one will be a complete failure and if you’re lucky, three of the five things will be mediocre.

The key thing to think about when you are choosing your different marketing and promotion activities, is that not all five of them are going to be successful. Fortunately, it’s also extremely unlikely that all five of them will be complete losers. It’s like putting together your retirement account. You don’t want to be all in one shop or all in one sector. Diversity is very important.

The Bottom Line on Marketing and Promotion
Marketing and promotion expenses will be big.  You need to think smart about how to best use your cash.  The key thing is tracking what you spend, and where you spend your marketing and promotion dollars. If you play the odds, something is bound to be a huge winner, one will likely be a dog, and the others will be somewhere in between.  If you keep diligent track of your marketing and promotion expenses you’ll know which is which.  

In this article, you’ve been introduced to marketing and promotion. To learn more about how you can improve your knowledge of marketing and promotion, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Terms of sale are what will keep you in positive cashflow.  As a new business you can’t afford to finance other people.  You need to keep cash flowing through your business so you have to set clear terms of sale from the start.

Terms of Sale Tips

• Don’t be too quick to give new clients credit. You can really get taken to the cleaners if your terms of sale include generous credit extension.  If you do offer credit, keep the limits relatively low until the client has built-up a solid credit history with you.    
• Always insist on written agreements as part of your terms of sale.  Verbal promises are for amateurs. Even if everybody knows everybody in your town,  you should insist on a simple one or two-page agreement that clarifies your role, responsibilities, and obligations.
• Always get a deposit check on any major project.  Require 25% at the absolute minimum and 50% if you can get it.  
• Bill weekly and not when you get around to it. A lot of people start off sending their bills out every week, but then they get really busy and it slows to every three or four weeks.  The reason for setting favoriable terms of sale is to get money into your bank account, not let your clients keep it in theirs.
• Always enforce your credit policies.  When you have a late payment, send past due notice or make a phone call to make sure the invoice gets paid.
• Make sure you have funds set-aside for the inevitable dry spell. Despite rigourous terms of sale you will have slow periods.  Don’t get cuaght with insuffienct funds.  

The Bottom Line on Terms of Sale
Setting appropriate terms of sale is an important function.  You need to understand your total capital needs and that includes monitoring your daily cashflow.  Make sure your terms of sale are such that you are not caught short.  When you do the work, you expect to be paid and the best way to protect yourself is by setting, and sticking by clear and reasonable terms of sale.

In this article, you’ve been introduced to terms of sale. To learn more about how you can improve your knowledge of terms of sale, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Sales cycles vary but it is important that you understand how much revenue your average small-business client is going to generate during a 12-month period. You need to know how long it takes to earn revenue from the point your prospect enters the sales cycle.  

Your sales cycle starts when you receive the initial lead and doesn’t end until the point where that person writes their first deposit check and signs their first contract with you. The sales cycle encompasses all the time and energy you put into changing the relationship from a lead to a paying customer.

When you first start your business it will be your responsibility to estimate the total sales cycle time.  You want to know how long it’s going to take to go though the sales cycle with an average lead.
Each section of the sales cycle involves time.  Things to consider include:

• How long are you typically in a qualification stage?  
• How long does it take you set the appointment?  
• How long does it take you to do some pre sales-call research to understand what you’re up against before you walk in the door?
• How long does it take you to do the sales call?  
• How many weeks are you on the sales call in the deep analysis and proposal?
• How long is your follow-up cycle?

You should also consider what kind of funds are going to be required for each stage of the sales cycle and what activities you will need to do in order to convert leads into paying clients.

The Bottom Line on the Sales Cycle
Knowing the average time of your sales cycle is a large part of the business planning process. You won’t know exact numbers but you need to estimate the total time involved.  Think about how long you’re going to be at different stages of the sales cycle.  Knowing how much time each stage of sales cycle is going to take will help you figure out how long it’s going to take to start generating revenue and producing a positive cash flow.

In this article, you’ve been introduced to the sales cycle. To learn more about how you can improve your knowledge about the sales cycle, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Market penetration is an important concept in business planning and development.  When you think in terms of market penetration you are figuring out they type and number of client you need in order to meet your revenue projections.  Your market penetration strategy must also consider the types of businesses in terms of your geographic location.  

You can’t simply choose your market penetration strategy arbitrarily.  It has to be grounded in research of the businesses in your geographic area.  You need to figure out how many businesses of a certain size and type exist and then tailor your market penetration strategy around the results.

Geographic Market Penetration Research
When you start thinking about the type of customer you need to target to meet your revenue goals it is wise to set up a grid.  This grid will track the type and number of business based on geographic location.

• Start by putting your business in the middle of a grid.
• Then move out in concentric rings further and further from where you’re located.
• What businesses are 15 minutes from where you are, 30 minutes from where you are, etc…? Do not go beyond 90 minutes.  Remember you need billable hours so you can’t take up your whole day driving to and from clients’ places of business.
• Figure out the different size levels of the businesses in your area.  
• How many business with 1 to 10 employees and 100k to 1 million in revenue are within 60-90 minutes?
• How many of these sweet spot clients are within 15 minutes, 30 minutes, etc.. from you?
• Then track large small-businesses with 50 to 200 employees and 50 to 100 computers the same way.

To gather the type of business size information you need for your market penetration research there are a variety of sources to consult including:

• libraries
• economic development or small business assistance offices
• mailing list brokers
• online research
• direct phone inquiries
• Dunn and Bradstreet
• Zap Date
• Info USA

The Bottom Line on Market Penetration
Market penetration must be looked at in terms of the business base in your geographic area.  You need to first determine the revenue you must generate and then look at the businesses within your area that can support these revenue projections. A good market penetration strategy is one that considers your geographic business base and revenue projections in conjunction with one another.

In this article, you’ve been introduced to market penetration. To learn more about how you can improve your knowledge about market penetration, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Unique selling proposition is a marketing concept that refers to the one element that sets a firm apart form its competition.  Your unique selling proposition is what differentiates you in the market place .  Every business needs to have a unique selling proposition because that’s what you use to convince people to buy from you as opposed to the other guy.

What Is Your Unique Selling Proposition (USP)
What makes you or your firm unique? You want to list eight or ten things and start out with the most important. List what’s different.

• Your background?
• Service area focus
• Service level guarantee
• Certain kinds of responsibilities and proactive monitoring?
• Certifications
• Industry experience
• Credentials

Whatever you unique selling proposition is, you should be able to list eight or ten things that make you different from your competitors.  

Your unique selling proposition then becomes the single most compelling benefit that your firm will provide to clients. When you talk about the features and benefits you offer, your unique selling proposition is the benefit.  

The Bottom Line On Unique Selling Propositions
The main element that differentiates you from your competition is you unique selling proposition.  Identifying and keying in on your unique selling proposition early on.  Use this unique selling proposition to market your services to clients in a way that highlights the features and benefits that you alone offer.

In this article, you’ve been introduced to the concept of a unique selling proposition. To learn more about how you can improve your knowledge about unique selling propositions, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Business plan outlines are all different.  The one common thread is that all business plan outlines help the writer answer the five W questions:  who, what, when, where, why.

If any of you ever worked in journalism or as reporters, what you want to do when you investigate anything is answer the 5 W’s.  A business plan outline is a concrete method for investigating a business idea so answering the 5 W’s makes sense.  

Business Plan Outline and the 5 W’s

• Who are you?  Your business plan outline should detail your certifications, industry experience, and credentials.  List the business credential that you’ve already received or those that you’re planning on getting in the early stages.  This part of the business plan outline also lists the staff you project needing and what their qualifications will be.  

• What do you plan on sell?  In your business plan outline you need to include a discussion of what it is you are selling.  Are you selling products, services or both?  Once you know what you are selling you then need to discuss the revenue and profit associated with your products and/or services.  

This part of the business plan outline also includes your preliminary sales and marketing plan.  What will you be doing to gain your clients and how much time and money will you spend doing so?

• When did you launch or when do you plan on launching? This information is critical to outside investors and it will also help to keep you on track.

• Where are you located?  Here you will indicate the types of facilities needed to run your business. Will you work out of your home or rent office space?

• Why is your approach unique? This is a critical question that your business plan outline must address. You need to explain your number one differentiator. Somewhere in your business plan outline you must make space for detailing the proposition that sets you apart from everyone else in the market.

The Bottom Line On Business Plan Outlines
Business plan outlines help you structure your answers to the most important business planning questions.  These questions can be summarized as the 5 W’s.  By answering these questions, your business plan outline will lead you to discover and detail the exact "how" of your overall business operations.

In this article, you’ve been introduced to business plan outlines. To learn more about how you can improve your knowledge about business plan outlines, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Consulting rates of your competitors provide an excellent starting point for your own billing rate analysis.  If you know you competitor’s consulting rates you can analyze various rate scenarios within a tighter range.  You don’t want to under or over price your own services and this information gives you valuable insight into what your target clients are currently willing to pay.  
   
Techniques For Competitor Sleuthing

• If you have friends or acquaintances that are niche technology providers, ask them what the going consulting rates are
• Ask business partners, accountants and management consultants what consulting rate their clients pay
• When you go to user group meetings, inquire about the going consulting rate in the area
• Try to access government bid information – the consulting rates will be quoted
• Look through old paperwork supplied by your clients and see if there is any mention of the consulting rate – purchase history, work billed, etc…

   
The Bottom Line on Consulting Rates
Setting your consulting rate requires knowledge.  You have to know what your services are worth in the market.  The best way to do this is to find out what your competitors’ consulting rates are.  Get creative:  use your network, don’t be shy about asking people outright, and do some snooping.  Once you know the going rates in your area it is much easier for you to strategically position your own consulting rate.   
   
In this article, you’ve been introduced to consulting rates. To learn more about how you can improve your knowledge about consulting rates, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business. 

Business growth is something we all want.  During startup, however, you have to balance your business growth rate with your ability to keep on top of the business launch. You don’t want to get overextended because that will cause you to cut corners and your future success may suffer.

Controlling the rate of business growth is difficult to do especially if you are moonlighting. In this situation you have so many more balls to juggle because you have work issues to deal with as well as business issues.  The key to effective business growth control is excellent organization and planning.

Micro Manage for Business Growth Control
During your startup it is more important than ever that you micro plan your major projects.  If you sell a 10 node network you will probably quote it by the number of hours for server installation, cabling infrastructure, taking care of the ISP and the telephone company, and taking care of the desktop.  To control business growth you need to take this type of calculation to the next level and develop a detailed hourly spreadsheet to account for your hours each week:

• Put your total hours and tasks required into a spreadsheet
• Break down each of the tasks week by week
• Estimate the number of hours you will need for each item during the week
• Add in some cushion time to deal with unanticipated issues
• Add general administrative tasks, work and family responsibilities, and leisure time requirements into the spreadsheet as well

This type of planning exercise will help you control your business growth because it will be easier to see if you are overextending yourself.  An overextended person is a stressed person and a stressed person is not an effective business manager or service provider.

The Bottom Line on Business Growth
To control business growth the best thing you can do is to make sure you have a handle on everything you are working on.  Break large projects down into smaller pieces.  Fit your projects into the other responsibilities your have whether those are work or family related.  Take a look at your weekly responsibilities and ensure you are not spreading yourself too thin in any one area.  This micro management approach will ensure your business growth rate does not spiral beyond your ability to keep up.  

In this article, you’ve been introduced to business growth. To learn more about how you can improve your knowledge about business growth, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.