Need ideas about consulting fees

Hope this topic hasn't been debated before, but I couldn't locate it if it was.

Backgouund is that I was a Techncal Specialist for a well known woodworking tool company for over 23 years. As a result I have access to many documents- Instruction Manuals & Parts Lists. After the brand has changed owner's a coule of times in the past 9 years, a new owner is trying to revive them.

Because of my resources, I have become their 'send to' source for old Instruction Manuals and out of date Parts Lists. The company determines they do not have what their customer needs, so they refer them to me. I provide those for customers at 10$ per document. That arrangement has worked fine.

Lately, I have begun to receive emails from their customers that were referred to me and the email is just seeking (for example) advice on what rip fence to buy; a machine is on ebay - is it a good deal ; I may buy thuis and want to know what problems I may encounter with it... emails of that nature...not seeking a document I could provide/sell to them- just knowledge/advice.

So, my question... the company has no problem if I charge for my services - whatever they may be - but I do not know how to DO that. I'm thinking there are only so many ways to do that...

1: Change by the question ; 2: Charge by the minutes I spend researching their question/writing it up, etc., or 3: a flat rate per interaction. of course, all fees would need to be obtained in advance- but is my thinking straight? Which way works best for those of you who do this?

Sorry for the length, but I tried to give enough info so as to obtain informative input. THANKS!!!

Tags: consulting

0 members like this

▶ Reply to This

Replies to This Discussion

Permalink Reply by Lee Smith, ND on September 1, 2012 at 8:13pm

1.) $24.95 to review an item that is considered for purchase (such as an eBay listing).

2.) $99.00 to fully support the purchase (if this item isn't a deal, or there's an issue, you'll help me find another one and review it, until I get one.)

3.) $300/day plus expenses if you want to do onsite consulting in the field.

These are just starting points and ideas, but regardless of where you start...you can change the rates and the deals going forward.

▶ Reply

Permalink Reply by Cayce Phalen on September 3, 2012 at 8:28pm

I think it depends on how long you think it will take, on average, to answer the questions in as much details as your customer would need. If it only takes you 5 minutes then you don't want to charge by the minute, you would want to charge by the question.

▶ Reply

Permalink Reply by Tom Murrah on September 4, 2012 at 5:32am

Thanks guys... Since I don't really know how long answering could take, I'm thinking an 'initial consultation fee' of 24.95 would cover most situations. Followups might be included, depending on how detailed those are. Fortunately, I can see the question befotre I have to answer, so I'll have a good idea up front.

▶ Reply

Permalink Reply by Raphael Husbands on September 5, 2012 at 8:15pm

You should check out Getting Started in Consulting" target="_blank"><a href="http://www.amazon.com/gp/product/0470419806/ref=as_li_ss_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=0470419806&linkCode=as2&tag=workmoneylife-20">Getting Started in Consulting</a><img src="http://www.assoc-amazon.com/e/ir?t=workmoneylife-20&l=as2&o=1&a=0470419806" width="1" height="1" border="0" alt="" style="border:none !important; margin:0px !important;" /> by Alan Weiss. He wrote a book (highly recommended by Dan Miller) called <a href="http://www.amazon.com/gp/product/0071622101/ref=as_li_ss_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=0071622101&linkCode=as2&tag=workmoneylife-20">Million Dollar Consulting</a><img src="http://www.assoc-amazon.com/e/ir?t=workmoneylife-20&l=as2&o=1&a=0071622101" width="1" height="1" border="0" alt="" style="border:none !important; margin:0px !important;" />. His stance is that consultants should never charge by the hour or even per diem (daily fees) for several reasons.

He suggests offering monthly retainer fees or charging "value based fees" for each project. Basically it means finding out how valuable a project is to the client and charging based on that. For instance, if you solving their problem will save the company a million dollars in the next year then you can reasonably charge $200,000. (They're still "up" $800,000). He also wrote another book called <a href="http://www.amazon.com/gp/product/0470275847/ref=as_li_ss_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=0470275847&linkCode=as2&tag=workmoneylife-20">Value-Based Fees: How to Charge - and Get - What You're Worth</a><img src="http://www.assoc-amazon.com/e/ir?t=workmoneylife-20&l=as2&o=1&a=0470275847" width="1" height="1" border="0" alt="" style="border:none !important; margin:0px !important;" /> that explains it in much more detail.

This might sound like it isn't "do-able" in your field but you should try it. For sure you can do the monthly retainer.

▶ Reply

Permalink Reply by Raphael Husbands on September 5, 2012 at 8:46pm

Sorry about that jumbled mess.

You should check out Getting Started in Consulting by Alan Weiss. He wrote a book (highly recommended by Dan Miller) called Million Dollar Consulting.

His stance is that consultants should never charge by the hour or even per diem (daily fees) for several reasons.

This might sound like it isn't "do-able" in your field but you should try it. For sure you can do the monthly retainer.

▶ Reply

Permalink Reply by Paula Frate on September 13, 2012 at 8:55pm

It depends on your industry. I do business startups and regulatory compliance in healthcare. We charge $100 to $120 an hour. That said do you have a blog? One way to fill your funnel with clients is to keep an active list of blog articles to answer some of the more common questions. Then develop your coaching or consulting product/service line so that you are giving away free content to gain traffic to your site.