Financial Considerations [SMB Consulting Best Practices book}

G’day everyone – I am sharing financial considersations for becoming a SMB technolgoy consultant as part of my daily virtual book reading!

But let me back up. I am Harry Brelsford, author of the SMB Consulting Best Practices book, and each morning, over coffee, I post up a few book passages as the virtual book reading. So here you go!

 

cheers…harrybbbb

Harry Brelsford, CEO at smb nation www.smbnation.com

Microsoft Small Business Specialist SBSC, MBA, MCSE, MCT, MCP, CNE, CLSE, CNP

PS – did u know I host an annual conference in Seattle each october for SBSers and SMB consultants? This year we help launch SBS 2008 and Essential Business Server (EBS) between October 4-6!

Financial considerations

Let’s call a spade “a spade.” One of the key reasons for becoming an SMB consultant is to make money. While some would say they are “entitled” to make good money as an SMB consultant, the more realistic attitude is that they have the “opportunity” to make as much money as they’d like.

If you choose to become an SMB consultant, rest assured you will have to earn all of the money you make. But that said, I encourage you to go forward with gusto. For some SMB consultants, their financial goal is to make a decent living free of an immediate supervisor. For others, a financial goal might be the big payoff that typically comes after long—and I mean really long—hours of work. The choice is yours. Either way, the financial section of your SMB business plan is critical. We’re talking money right here and right now!

What to charge

Let’s start with the good part: revenue. As an SMB consultant, one of the key questions is what to charge. Few other financial variables will have a greater impact on your financial position as an SMB consultant. Billing rates are a function of locality, expertise, specialty, luck, and ability to negotiate. Your SMB consulting business plan must include discussion and analysis of the revenues you intend to generate.

Incurred costs

Next up is costs, the second most important financial variable after determining your SMB consulting bill. I’ve witnessed many technically competent SMB consultants who enjoy an overwhelming volume of business actually report underwhelming financial results because they couldn’t control costs. Leasing a flashy minivan with a company logo on it before your financial resources can justify such an expenditure is an example of letting your costs get out in front of your revenues. Your SMB consulting business plan must include discussion and analysis of the costs you will likely incur. The highway to SMB consulting success is littered with road kills of smart


SMB consultants who busted the bank (not to mention wrecking the company minivan!) before making their mint.

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