"Consultants are too expensive!"
This is something I often hear from entrepreneurs and small businesses when evaluating business needs and pricing contracts. Yes, consultants can be expensive, but a more accurate statement might be that "Bad consultants are too expensive." Good consultants are invaluable and more financially beneficial than other alternatives.
Initially, many entrepreneurs and small businesses are extremely price-sensitive in their strategic and operational decisions. They place less emphasis on - or completely ignore - other costs such as time and energy, which ultimately end up damaging the quality of their product or strategic plan.
An entrepreneur or small business owner wears a lot of hats, and there is a point either emotionally, physically, or mentally, at which it is impossible for them to handle all facets of a business with a "DIY" mentality (without sacrificing quality). The "breaking point" can vary by person depending on personal capacity or skill set. This point is not based on a certain level of sales volume or customer activity. It's so subtle that you may not even notice the decrease in the quality of your product or plan.
If you have the self-awareness to realize that you might need help in certain areas of your business, congratulations! This is a great first step. The next step is to decide where you will get help. Your options are to find a partner (co-owner), hire employees, or hire a consultant.
Finding a business partner is an extremely difficult and time-consuming process. A new partner needs to understand and share your vision and be willing to make a long-term commitment to your business. You will also give away a portion of all future profits from the business (equity). While this may be the most inexpensive short-term option, the long term implications are costly, especially if your business grows into a profitable enterprise down the road.
The next possible solution when an entrepreneur or business owner realizes they need help is to hire employees. Hiring employees has its benefits for a well-established organization, but there are many risks that are magnified especially in a small to medium-sized business. The taxes, healthcare costs, and other employee-related expenses that many people have become accustomed to (retirement benefits, company-sponsored events and perks) require a great deal of capital investment. Employers also face the risk that they selected the wrong person to fill key roles in their growing organization, and it can be complicated and costly to sever a relationship with an employee that is not the right fit.
The final option, and in our opinion the best option for entrepreneurs and small businesses (we're biased, I know) is to hire a consultant to assist with integral functions. Where a full-time employee brings one perspective - their own - to strategic and marketing projects, a consultant (or consulting firm) can leverage years of expertise in many different areas and case studies. Chances are a consulting firm has dealt with the business issues you are facing and tested what worked (and what didn't) on another business. In addition to experience, consultants are financially less burdensome than full-time employees and require less commitment. It is easier to terminate a business relationship with a consultant than with an employee where you have invested considerably more financial and corporate resources in onboarding.
While consulting fees are considered by some to be expensive, in light of the alternatives, a consultant could be the best solution for you as an entrepreneur with many varying roles and responsibilities. The chart below makes a financial case for consultants. Outsourcing often proves to be the less expensive option for smaller organizations.
The ARKAY Group has a unique pricing structure and a process designed to provide maximum value at a fixed monthly cost regardless of the type of request or project term. Find out more about the services we provide or request a free consultation & pricing quote by visiting our website.
Comments