COMPUTER CONSULTANT

COMPUTER CONSULTANT

Vital Information

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Start-up Investment

Low - $0 (consulting for existing clients)

High - $5,000 (setting up an office and advertising)

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Break-even time - Immediate to one year

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Estimate of Annual Revenue and Profit

Revenue $50,000 - $250,000

Profit (Pre-tax - $40,000 - $200,000

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A Computer on Every Desk?

With the advent of PCS, computer systems are now accessible to

small and mid-sized companies. Very few businesses, no matter

how small, can not afford to ignore the growing demand for instant

information and finger-tip response to their clientele.

Computerization is a standard tool of competition and, if used

correctly, should rapidly pay for itself in a reduction of man

hours and an increase in efficiency.

Most companies have to computerize in order to "keep up with the

Jones" but many small and mid-sized businesses haven't the

slightest idea which of the myriad of available hardware and

software makes the most sense in terms of their own business.

And ...this creates a natural marketplace for the computer

consultant. The demand for these services is growing by leaps

and bounds.

Making Cents

Computer consultants serve two basic functions:

Selecting the appropriate computer system, including hardware,

software,networks and peripherals. This is a one-time project and

vital to the success of the automation process. Most business

people are afraid of spending thousands of dollars for an

inadequate or incomplete system. A consultant maps out the

strategy for the appropriate system and the most effective and

efficient software.

Integrating the computer into day-to-day operations. A consultant

may be used on a on-going basis as upgrades in software occur or

then network needs to be expanded.

A computer should make a business so much more efficient and

productive that it pays for itself. Computer consultants not only

productive that it pays for itself. Computer consultants not only

help businesses realize this potential but a computer consultant's

expertise should make the process much less stressful and the

transition processes more comfortable and easier to accept.

Overhead Is Minimal

The only inventory you need is what's stored away in your brain:

education and on-hands experience are your greatest assets. Like

most computer experts, you probably already own your own PC and

that's the only equipment necessary for start-up. The more involved

systems work will come on-site as you design and install your

client's more sophisticated hardware and software. The lion's share

of your start-up expenses will be advertising and marketing your

services.

Because your work will be exclusively on-site at your corporate

customer's locations, it will not be necessary, especially in

the beginning, to have an outside office. Not only will your costs

be kept at a minimum by working from your home, but you can

deduct office-at-home expenses off your taxes for the percentage of

your home you convert into office space, but be sure to use that area

of your home exclusively for your work.

When you begin your marketing efforts, do your homework and find

out the type of customer who is truly in need of your services. Most

undoubtedly, you will want to target mid-sized corporations. The big

boys probably have permanent on-site computer experts and the

little guys probably can't afford you. Make your marketing dollar as

effective as possible by doing some legwork before you begin.

You will also want to look long and hard at your areas of expertise.

Do you have a specialty or are you an across-the-board type of

computer expert? Should you target a specific industry? Can you

easily recommend the proper system to an accountant as you can

for a trucking company?

Geography plays a major part in identifying potential clientele. If

your specialty market is scattered all over the country, you'll want

to advertise on a wide-scale. If you are the across-the-board expert,

you can target a specific location. Keep in mind, the closer to home

you're working, the less of your capital will be eaten up with travel

expenses.

It is very important to establish on-going relationships with your

clientele. Many companies pay their consultant a retainer good for a

few hours per month in order to have a standing opportunity to ask

questions or upgrade programming. This is often a less expensive

option for your clients than hiring a full-time staff person. You

will need to let your clients know how you can help them in their

day-to-day operations and set up a flexible enough schedule so that

you will be able to work within their parameters. Working on this

basis with a number of companies will guarantee you some regular

income and cut back on marketing expenses.

Balance What You Know and Who You Know

Since you can't possibly know all there is to know about computers,

you'll need to make contacts in the industry who can assist you when

you come up against a situation you're not qualified to handle. You

will want to compile a network of professionals you can call on to

fill any voids you find as you go along. You have the option to

subcontract to other consultants (many university professors, for

example, free-lance as consultants). You may want to put your

subcontractors on the payroll or you may simply wish to put your

client in touch with your source and then step quietly out of the

picture. You may not receive immediate remuneration for the

recommendation, but the long-term benefits can be well worth your

efforts. Not only will this build good-will with your client but

the other consultants may wish to return the favor when they have

a need for your area of expertise.

To Market or Not to Market?

When starting any new business, the main focus must be on

effective

marketing. The first contacts will be the most difficult and will

probably require references. However, after you reach your capacity,

you will have a tendency to slack off on your marketing. You'll be

so busy with one or two clients that you'll forget that there is

an end to the work and to the income. Suddenly, the work will be

are starting all over gain. It is absolutely essential to keep

marketing even when things are at their most hectic.

A certain percentage of your time should be spent bringing in new

business no matter how busy your are. You will have to decide what

percentage of time allows you to keep an even flow of business

coming in and out. You will find yourself only spending a portion of

your time in "billable hours." A certain amount of time must be spent

doing administrative functions, like billing and taxes. Another

portion of your work must be spent in staying up-to-date with current

developments in the industry and with software and hardware

innovations.

You may also want to round out your services by writing articles for

magazines or publications or giving seminars or workshops. These

types of endeavors can help provide additional revenues and

expand your network for both clients and subcontractors.

If you billable hours fall off, you will want to devote more time to

marketing but remember, no matter how much money you already to

have to do, your's is a finite service and sooner or later, you're going

to need new business. So never forget to continue to market...,

network, and expand your client base. This will help to curtail the

roller-coaster ride many new and/or small businesses face.

Common courtesy will also help your gain referrals and keep your

clients happy. Send a thank you note to clients to let them know

that you appreciate their business. Make follow up calls to let

them know that you are concerned that the services you provided

them are effective and producing the results you were anticipating.

A little personal touch here and there can keep your name in the

minds of the most hardcore business person.

Manage Your Growth

Many computer consultants opt to stay one person operation. One of

the attractions of being your own boss is that you can leave behind

the hassles and politics of corporate life. The flip side of that

coin is that the only funds coming into the business are your own

billable hours in any given day. Owners of large computer-consulting

firms reap a percentage of every dollar earned by each associate.

There are many trade-offs involved in being self-employed. Neither

option is going to be a walk in the park. But the most important

thing to keep in mind is to manage your company's growth. Don't get

in over your head, just take one step at a time and keep an eye on

the road ahead.

Resources

Industry Associations:

Independent Computer Consultants Association, 433 N New Ballas,

P.O. Box 27412, St Louis MO 63141 (314) 997-4633

ACME Inc., 230 Park Ave., New York, NY 10169 (212) 697-9693

Institute of Management Consultants Inc.,19 W 44th St.,

New York, NY 10036 (212) 921-2885

Publications:

Consultants News, Templeton RD,Fitzwilliam, NH 03447 (603) 585-

2200 Byte, 70 Main St.,Petersborough, NH 03458 (603) 949-9281

Business Computer Systems., 375 Washington St.,

Newton, MA 02158 (617) 964-3030

Info World, 1060 Marsh Rd.,Suite C-200, Menlo Park, CA 94025

(415) 328-4602

For additional information helpful in setting up your new

business, information about licenses, permits, the legal structure

of your business, taxes, insurance and much more refer to the:

Business Start-Up fact Finder Manual