I agree that launching any new business is a risky and daunting task, but, there are a few things you can do to make sure your transition from salaried employee to full time business consultant is as easy and painless as possible.
Start Working Part Time
If you are really serious and want to become a consultant, working at a part time job as you get established is one of the best ways to go about it. Of course it takes long hours and dedication, but you do have the opportunity to fund the start yourself, with your salary, and possibly, if it is the same industry, make invaluable contacts!
Even a few hours after work every day, and on weekends, can have you on your way to your own consulting business faster than you think!
Have a Consulting Action Plan
Developing a plan for your transition is a good idea, especially if you are “bootstrapping” (financing the consulting business), without external funding!
Your plan can include things like having a predetermined number of clients “on board”, and things like purchasing office equipment, developing your marketing materials, and taking care of administrative details, before you launch full time.
It is amazing how long these little things can take to do, and making sure they are taken care of before your consulting business becomes your only income is a very good idea!
Determine Your Launch Date
There are so many factors that could affect your launch date that you want to consider it carefully.
Choosing the right time to launch can be critical to success, and it may depend on factors such as payouts from retirement annuities or eligibility for retirement, early or otherwise. There may also be an ideal time to launch, dependent on your industry – before the busiest time of year, but not in a slump.
Whatever the factors, make sure you take them into account!
Build a Nest Egg
If at all possible, try to build a buffer of several months’ salary, which can tide you over during the difficult start up months.
While you may have big plans, and really believe your consulting business will take off from day one, the truth is, it is rarely the case with any new business, and it can take anything up to two years before you become profitable!
Aim for around six months worth of salary, and you should be OK, since there is a good chance you will have some work to supplement that during the first months.
Get Clients Pre Committed
This ties in very closely with building a nest egg. If you can have a small pool of clients committed before you launch full time in your consulting business, that nest egg is going to last a lot longer!
It may even be possible to turn contacts from your current employment into clients for your new venture. Look around, talk to people and make contacts, then get them signed up, and you should start off with a flourish!
For most people, once they have decided to “go it alone” they cannot wait. Getting out of the rat race, being your own boss, and building a successful consulting practice is a seductive proposition, but a little forward planning, and putting critical success factors into place, which will take a little time, is a much better way to ensure your long term success!