How to Start a Consulting Business

Yearning for more autonomy, flexibility, and control in your career? Imagine getting paid to work in a field you're truly passionate about, directing ambitious projects, bringing creative ideas to life, and generating new business from every client you serve.

For a growing number of professionals, that's the reality of life as a consultant. Today, consulting extends far beyond traditional business strategy and IT services. Veteran baristas are earning six figures advising on craft cafes, estheticians are creating custom skincare routines for clients online, and skilled photographers are teaching others to turn their hobby into a business.

But how exactly do you go about launching a successful consulting practice? In this guide, we'll walk you through every step—from identifying your niche to winning your first clients.

What does a consultant do?

A consultant is someone with a professional specialization who dedicates their expertise to helping clients solve problems and achieve their goals. They step in with expert knowledge, whether they're assisting a business, guiding an entrepreneur's new venture, or working with individuals to transform their career, wellbeing, or personal style.

What sets consultants apart is their flexibility. Unlike full-time employees, they work with clients as needed, becoming temporary, dedicated partners tasked with delivering results. Consultants don't just give advice from the sidelines—they roll up their sleeves and work alongside their clients to make change happen. The best consultants become trusted advisors by mastering specific areas of expertise and bringing in skills and perspectives that clients don't have.

Key responsibilities and expectations

A consultant's work typically involves three main phases: assessment, strategy, and implementation.

First, they dive deep to understand their client's current goals and situation. This might mean analyzing a company's financial data, evaluating a home's layout, or reviewing someone's current skincare routine.

Next, they develop a clear plan of action. Drawing on their professional experience, consultants identify what needs to change and map out practical steps to get there. For a business consultant, this could be a detailed roadmap for expanding in a new market. For a personal wellness consultant, it might be a customized nutrition and exercise plan.

Finally, consultants guide implementation. This often includes:

• Training clients or their teams on their recommendations

• Monitoring progress and updating strategy as needed

• Documenting changes and creating plans for long-term success

• Troubleshooting unexpected challenges that arise

Consultant vs. freelancer: What’s the difference?

While both consultants and freelancers are self-employed professionals, the difference lies in the projects they take on. A consultant is hired primarily for their strategic expertise and guidance in solving complex challenges, while a freelancer typically executes specific tasks or deliverables.

Think of it this way: A freelance graphic designer creates logos and marketing materials based on a client's requirements. A brand consultant, on the other hand, develops the overall brand strategy and might work with freelance designers to bring that vision to life. Many professionals successfully blend both roles, such as a web developer who both advises on technical strategy and handles the actual coding.

Types of consulting services

The consulting industry is rapidly expanding for every niche and type of client—from support for marketing, finance, and HR, to direct-to-consumer services like floral arts, life coaching, and interior design. For talented professionals looking to carve their own path, there's a consulting opportunity to explore. Here are some common approaches.

1. Expanding your passion into new professional horizons

• Experienced chefs consult on restaurant launches and menu design

• Interior designers create concept boards for low-cost room makeovers

• Life coaches help individuals navigate a career pivot

2. Turning digital expertise into new opportunities

• Digital specialists help small businesses master digitization and automation

• Social media creators teach others to build profitable communities

• Virtual services, like nutrition coaches who offer meal planning through apps, and personal stylists who create capsule wardrobes via video chat

3. Adding digital products to complement consulting

• A garden designer charging $5,000 for custom landscaping plans offers a $197 online course on sustainable gardening basics

• Designers sell digital downloads of worksheets, templates, or art

• Fitness instructors add paywalls to educational videos or blogs

4. Going independent with your corporate expertise 

• Finance experts guide startups through funding rounds

• Marketing veterans manage campaigns for multiple high-growth companies

• HR directors help companies build and scale their culture

Start your consulting business in 6 steps

1. Choose your consulting niche

Look at the skills, knowledge, and achievements that set you apart—whether that's your expertise in supply chain optimization, talent development, digital marketing, or any other specialized field. To find your niche, you’ll need to find where that expertise lines up with market demand. Who or what type of business would benefit from your experience, and how?

Get more tips for finding your niche

2. Research your market and target clients

Once you have a sense of your niche, talk to potential clients about their specific challenges, how they currently solve them, and what they'd be willing to pay for solutions. These conversations will not only validate your market but also give you invaluable insights into positioning and pricing your services.

Get specific about your ideal clients. Are you targeting high-growth startups looking to raise money? Small business owners struggling with digital transformation? Individual clients looking for personalized planning help?

Learn how to identity your target audience

3. Package and price your services

Build packages around concrete deliverables and outcomes. A skincare consultant might offer a “Big Night” package that promises to get clients glowing before a big event, while a digital marketing consultant could offer a 3-month launch package for new product releases. 

Consider creating different service tiers, like:

• Done-for-you service packages: You handle everything from strategy to execution. For example, a social media manager might create content, schedule posts, engage with followers, and provide monthly analytics reports. An hourly rate or monthly retainer often works well in this case.

• Strategy and support packages: You provide expert guidance upfront, and give input on the client’s work. For example, an interior designer might create a mood board for a living room makeover, and answer questions about paint color or layout choices as the client brings the vision to life. For these packages, a project-based fee works well. 

• Digital products like templates, workshops, or online courses for scale: These require accessible pricing—starting in the tens or hundreds of dollars—but can be quite lucrative. Once they’re created, you can sell them forever without customization.

To gauge where to start with pricing, research other consultants in your space. Many post their rates online. If you find someone who's operating with a similar structure but isn't a direct competitor, consider reaching out for advice. You'd be surprised at how many people will be willing to share their insights.

4. Set up your business structure

If you're a consultant, you run a business, and you'll need to register it. Doing so builds credibility with potential clients and makes it easier to manage money as it starts flowing in.

If you operate in the U.S., these are the main business structures you can consider. The details below shouldn’t be taken as legal advice. We’ve provided a broad, informational overview of the pros and cons, but you’ll want to speak to a lawyer and an accountant for your specific circumstances.

• Sole proprietorship: This is the simplest option and the most common for consultants. Usually, starting as a sole prop is ideal—minimal paperwork, easy taxes, and you can always evolve later. The main downside is that your personal assets aren't protected if someone sues your business, which makes insurance especially important.

• LLC (Limited Liability Company): An LLC protects your personal assets from legal or financial issues in your business without complicating your taxes. The downside is, establishing an LLC requires more paperwork and fees than a sole proprietorship.

• Corporation: If you're in a high-liability industry, plan to scale significantly, or expect to bill over $250,000 annually, you may want to consider incorporating. While corporations require the most paperwork and ongoing compliance, they limit your personal liability and make it easier to raise capital or bring on partners.

Once your business is registered, you’ll want to set up these essentials:

• A business bank account to keep personal and business finances separate

• Professional liability insurance to protect yourself and your clients

• Basic contracts and service agreements

• An invoicing system, like Squarespace’s, that makes billing and payment collection professional and seamless

5. Establish your online presence

Create a professional digital footprint that showcases your expertise, communicates your value proposition clearly, and makes it easy for clients to take the next step.

Start with a strong website. Your homepage should immediately communicate:

• Who you help and what specific problems you solve

• Your unique expertise and approach

• Clear next steps for potential clients

• Proof of your expertise through case studies or testimonials from past employers or clients

Next, drive traffic to your site through content that showcases your expertise, such as expert blog posts, email newsletters, and social media tips.

Remember, marketing sets the foundation for your business’ growth, so it’s worth spending time on. Here’s a full rundown of everything you need to know about marketing your consultancy.

6. Find your first clients

Your fastest path to paid work often starts with your existing network. Reach out to former colleagues, employers, and connections. Don't just ask them to hire you, ask them to connect you with others who might need your help.

Here are some tips to help you get started:

• Include a scheduling tool on your site to make it easy for prospective clients to book consultations. 

• Start with small pilot projects to prove your value. These can turn into referrals or larger future projects.

• Don’t be afraid to follow up with prospects. It can feel uncomfortable, but staying top-of-mind can help you get hired.

Best practices and tips for success

While everyone’s consulting business will look different, there are some habits and practices that can help you build a sustainable, fulfilling business.

1. Develop processes you can replicate

The more you can systematize routine tasks, the more time you'll have for high-value strategic work:

1. Create templates for proposals, contracts, and project updates, so you can quickly adapt them or leverage AI to update them.

2. Map out your typical client journey and create project templates accordingly.

3. Set up automated scheduling and payment systems. Acuity Scheduling and Squarespace’s Invoicing tool make this seamless.

4. Develop checklists for quality control before delivering work.

2. Nurture your network

Your network will drive most of your business, especially in the early days. Focus on these key relationships.

• Clients: Go beyond basic deliverables. Really understand their goals, celebrate their wins, and stay connected even when you're not actively working together. A satisfied client who will refer you is the most powerful marketing campaign.

• Partners: Connect with other consultants whose services complement yours. That marketing strategist you met at a conference? They might become your best referral source for clients who need deeper expertise in your area.

3. Grow strategically, not just quickly

Growth in consulting isn't always about taking on more clients. Consider ways you can expand with new skills or offerings that differentiate you from competitors. Invest time and energy into:

• Developing deeper expertise in your niche

• Creating more valuable service packages

• Finding ways to serve clients better, not just serve more clients

4. Set boundaries for work/life balance

As a consultant, your energy and creativity are valuable assets. Protect them by:

• Setting clear boundaries around your work hours

• Building in time for learning 

• Maintaining clarity on why you started consulting in the first place

Remember, success isn't about having the most clients—it's about doing meaningful work that delivers real value.

Ready to launch your consulting journey?