Here's how you can navigate the common mistakes when starting a consulting business as an entrepreneur.

If one is starting out in a consulting career, especially from an independent consulting point of view, it is important to keep in mind that building deep expertise in a niche area, and then being recognised for it, takes time. Also, it cuts both ways, especially at the start (even long term) - there is such a thing as competition - so many similar consulting professionals who excel in the same area. Ideally, have a field, not too specialized, that your offerings cover - say, Business or Digital Transformation, Organization Development, Change Management, Enterprise Software (ERP/CRM, etc). This will give you more opportunities and you can find your niche as you familiarise and get comfortable with the consulting landscape.

Pinpointing your niche is vital when starting a consulting business. Focus on the area where you have the most expertise and can offer the greatest value. Avoid trying to be everything to everyone, as it dilutes your brand. Specializing in solving specific problems sets you apart from competitors and makes your marketing efforts more targeted and effective, ensuring clients understand exactly what you offer.

As an executive with 20-30 years of experience, you know a lot. You could do many things, sure. But choosing a niche is not about what you can do. It will define ↳ How you want to be remembered ↳ How you will market yourself ↳ What sets you apart Tip: Go 2 levels lower to find a sub-niche. Example: Broad Topic → Niche → Sub-niche Coach → Leadership Coach → Confidence building for First-Time Leaders

I would extend it to defining your scope or gamut; although consulting is a service not a solutions product, some boundaries are essential to avoid extending tons of extra man hours. Along with niche, your scope and value proposition has to be drafted on day 0 - and it must be tuned and evolved based on market feedback. During my initial days - I could not say NO - and also took up assignments such as 5S implementation in Machine Shop, which was way away from the niche. So defining niche, comes with the ability to say 'NO' - not everyone who walks in and is willing to pay can be your client.

Setting rates effectively is crucial when starting a consulting business. Begin by researching industry standards and assessing your unique value proposition. Consider your expertise, experience, and the specific services you offer. Avoid underpricing to compete solely on cost, as it can undermine perceived value. Conversely, avoid overpricing without a strong justification, which can deter potential clients. Test your rates with early clients, seeking feedback on perceived value versus cost. Adjust rates based on market response and ongoing assessment of your business expenses and profitability goals. By setting rates strategically, you can attract clients while ensuring sustainable growth for your consulting business.

Rates! Everyone wants an intelligent or wise person to enlighten or create value - but value is won't be worth your effort unless you are reasonable compensated. For those ex-XYZ folks, forget about what your firms billed the clients - if you are out on your own, perhaps you are catering to a different league of clients. So first is to identify your segment and understand what is your value proposition. Start with a range hypothesis and fine-tune it based on market feedback. However, there will be other opportunities where you can deviate from your standard rates based on the urgency of assignment and value at stake. So keep yourself guided but flexible to leverage opportunities.

This is super important, as I've found in my own experience. At some point, you will also need to make choices. Many clients will need you to have a registered corporate entity, and then get empanelled into their approved list of partner organizations. And among them, several will need you to be well capitalised for legal reasons. There is also perception value that plays into it - between say a proprietor and an LLP or a private company, etc. Having a good chartered accountant and legal expert in your circle is also helpful to navigate some of these situations.

Signalling! Having a corporate entity is not only important from compliance perspective but also provides assurance to prospective clients. Usually, an LLP - Limited Liability Partnership works better, as the compliance efforts and costs are lower compared to Private Limited - plus the mechanisms allow easy onboarding of new partners. Furthermore, in India, MSME registration helps in case of recovery of bad debts, as you would be able to send recovery notices as under MSME protection. Also, GST registration also helps you secure input tax credit - although not much, it should save you quite a bit on the cost side.

A robust marketing plan might work for big companies. If you are starting now, you need to master the basics. One strategy. One channel. One offer. The keyword is consistency. Simplicity works.

Networking and Reputation! Focus on your Personal Brand You need a LinkedIn & One Page Website And create a 10-15 Slide Deck for meetings Digital Marketing and Social Media aren't effective, as these means fail to provide assurance.

One thing I've found helpful in my career as a global business consultant is to tailor communication strategies to align with the cultural expectations of each client. This goes beyond regular updates and clear channels; it involves understanding and respecting cultural nuances in how information is received and processed. By adapting our approach to each client’s cultural context, we enhance understanding and trust, paving the way for long-term relationships and referrals. This focus on cultural competence in client relations is key to success in a global marketplace.

Most important, continuing to get relevant professional certifications not only helps with learning but also accentuates credibility. Other than continuous learning opportunities, one must also explore opportunities to speak at Seminars or Industry Events, and write opinion-ed articles for local newspaper or industry publications. This not only serves as a tool for personal branding but these exercises also force you to undergo mental processes that further refine and built upon your learning from practice.