In IT Consulting, What Does A 75 An Hour Consulting Business Equate To In The Long Run? What Happens If Your Rate Structure Extends Beyond That?If You Keep Carrying Something Like A 75 Or 85 Level Beyond The Grand Opening Special To Get Your First Couple Of Clients, Your Business Will Become More Of A Hobby Or Non Profit-type Organization. Consider Overhead And ExpensesYou Say, "How Can That Be? Why Doesnt 75 An Hour Equate To 150,000 A Year?" Wrong, 75 An Hour In Running Your Own IT Consulting Business Doesnt Come Out To 150,000 A Year Because You Cant Bill 2,000 Hours A Year.New Consultants Often Fail To Consider All The Overhead And Expenses That Usually Come Up As An IT Consulting Business Matures. The Uninformed Person Just Starting Out Usually Believes That 75 An Hour Times 40 Hours A Week Times 50 Weeks A Year Is 150,000 A Year In IT Consulting Revenue Because They Think Theyre Going To Bill 40 Hours A Week Every Week. Know There Will Be InconsistenciesIts Not Going To Happen Unless Youre Working 100 Hours A Week, And Its Probably Still Not Going To Happen Every Week Consistently, For Many Reasons. Starting An IT Consulting Business Sounds Great On The Surface. Youre Thinking, "Im Going To Work From Home. Im Going To Keep My Overhead As Low As Possible." Consider Your Utilization RateYou Need To Consider Whats Called Your Utilization Rate. Its The Reality Of Only Being Able To Bill Out, On Average, About 75 Of The 40 Given Hours In A Week. It Still Can Take You Six Months To A Year To Even Get To That Level Consistently. The Bottom Line About IT ConsultingFinally, One Of The Most Important Things New IT Consulting Businesses Overlook Is The Question Of What Happens As Your Business Grows And You Want To Scale Up? In Setting Your Rates, You Need To Consider These Factors.Copyright MMI-MMVI, Small Biz Tech Talk. All Worldwide Rights Reserved. Attention Publishers: Live Hyperlink In Author Resource Box Required For Copyright Compliance
