Hanging out a shingle that will last: independent consultants offer tips for starting your own business

Communication World, Oct-Nov, 2003 by Stacy Wilson

Serving as a speaker at conferences and professional association meetings is another good way to get exposure, and Clemons recommends volunteering for a nonprofit organization or your local chamber of commerce.

A few consultants engage in more formal marketing techniques, such as sending out brochures and holiday cards via direct mail to prospects and customers. Publishing a free electronic newsletter or sending e-mail communication are other ways to keep in touch with your networking circle.

Of the professionals surveyed for this article, most have a web site but few have print collateral. All belong to a professional association, like IABC. For some, an association membership helps bring in work; others join for support and access to continuing education opportunities.

Although some consultants will accept a client outside their immediate region, most prefer to build a client base close to home. For many, keeping travel and time away from home to a minimum is part of the lure of independent consulting. But Internet technology is clearly making client location less and less relevant.

STRUCTURE AND STAFFING

How entrepreneurial communicators structure their businesses and staff projects varies widely. Most seek the counsel of attorneys or accountants on business structure, keeping in mind state-to-state and country-to-country variations. If you are establishing a business within the U.S., here are some big-picture issues to consider:

* An S or C corporation requires a bit more paperwork, but allows the easy addition of salaried and hourly staff and has some tax benefits with regard to deductions. Although it is fairly easy to move from an S-Corp to a C-Corp, doing the reverse is more difficult.

* A Limited Liability Corporation (LLC) offers greater liability protection and more flexibility to add partners or sub-LLCs later.

* A sole proprietorship offers much less paperwork, but little separation from personal finances and no liability protection.

* Virtual firms are typically set up as LLCs with several partners representing different disciplines. They market and network together, support each other on project work, and serve as sounding boards and motivators. Each partner feeds a capped percentage of profit into the business, which pays for a partnership web site, print collateral, tax preparation and the like.

As for staffing, most independent communicators aren't looking to add employees right away. Those who plan to add staff typically expect to do so within the first two to three years. Most consultants surveyed say they prefer to subcontract for project support services such as writing and for other senior consulting expertise. "Clients get the expertise when they need it, and they can turn it on and off," says Shelley Greiwahn, ABC, owner of Cooper Wright LLC, in Washington, D.C., USA.

FINANCIAL MANAGEMENT

Lack of experience in financial management is often the biggest obstacle to making the move to independent consulting. A good first step is to consult with an accountant who can lay out all of the initial and ongoing requirements for business operation. Software accounting tools make the process easier. Pick one that fits your business model and is compatible with your accountant's computer systems.