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The Problems With Working For A Consulting Agency (Do This Instead)

By Michael Zipursky


You might be losing a lot of money right now.

I’ve worked with hundreds of consultants in many industries all around the world and often I hear about situations where people are losing a lot of money, they’re losing a lot of opportunities. In some cases, they’re aware of it. In other cases, they’re not.

What am I talking about? I’m talking about working with other agencies. I’m talking about you working as a consultant and not a consulting business owner. There’s a very big difference. So let’s look at these. I’ll put it all into play for you.

If you work as part of an agency, what it means is that you are called upon for your experience and expertise to deliver a project or to facilitate a project or an initiative.

Now that’s good, right? You might think, well that, and you may have even experienced it where it’s nice because the work comes to you. The problem with that is there are a few things going on.

Margin Pressure

Number one is there’s margin pressure.

No margin pressure is really just a fancy way of saying that you’re leaving money on the table and put it in another way. You’re losing money.

Why? Because let’s just say that the agency is billing you out at $2,000 a day, but they’re only paying you $1,200 a day. What that means is that every day that you work with that agency, you’re leaving $800 on the table. I might not look like a lot of money, but if you compound that over a series of days and weeks and months and years, it can add up to a lot of money and I’ve actually seen situations that are far worse.

We’ve had consultants reach out to us that have been working with agencies or kind of as contractors, right within these organizations where they might get below $2,000 a day, but they’re not getting $1200. They’re only getting $800 a day.

What that means is that you’re now leaving $1,200 on the table every single day that you work. There’s obviously value the agencies providing because they’re bringing the projects to you and you just need to go and show up and do the work. The question is, how much is that worth?

Becoming Reliant

The other issue, however, makes this even worse, and the second issue is that you’re really not building your own business. You’re helping to build their business so you’re not building your business.

working for an agency

You’re not building your business because you don’t have the actual client. You might be working with a great client, but they’re not your client. In many cases, you won’t even be able to use their logo or their name or create a case study around them because they’re not your client. The other thing is that you know what? What really happens here is that you become very reliant. You might find it a hundred percent of daily work or even 60 percent of your daily work.

It’s coming from one agency from one other consulting company, and that might take up a lot of your time and drive a significant amount of your income. The problem with this is the moment that they decided to stop sending you business your weight or they have an issue, whatever that issue might be, your business is gone because you don’t have a business. You’re a consultant doing work, but you’re not a consulting business owner.

You’re not developing your own brand. You’re not creating value around your, your brand itself because no one knows what people think that you are part of this agency and you’re a consultant now that might lead to some other work down down the road and so forth.

If this agency goes out of business, but you’re not building your business. And so the real challenge is you’re not building and creating value, but you’re also losing a lot of money because every time that you take on a project, the agency is taking a good portion of it, which otherwise you could be collecting.

I know there are so many consultants that we’ve had conversations with the reach and say:

“Hey Michael, I’ve been doing this for three years. I’ve been working with this agency. I’ve been making a hundred and fifty thousand two hundred fifty thousand dollars per year. It’s going really well. But the problem is they’re not sending me as much business as they used to, or the problem is that I actually realized that they’re taking 60 percent of what they’re billing out for and that doesn’t feel good to me anymore because I’m doing all the work, right?”

Not only am I actually doing the work on delivery for the client, but I’m actually also in that kind of managing the client relationship now. And so they start to take on more responsibility, but they’re not getting paid more for that.

Building Your Own Consulting Brand

My suggestion to you is there’s nothing wrong. You know, it’s, Oh, this is a bad model. For some people, this will be a great model because you don’t want to think about marketing. You don’t want to think about building your own brand and your business.

You essentially are an employee. You’re a contractor or you’re a freelancer, you’re a consultant with an organization, but you don’t have a business. You don’t have true freedom and flexibility. You’re not answering to yourself. You’re answering to the owner of the agency, you’re also leaving a lot of money on the table with every project that you take on and there’s no real value being created around your own brand because every single you’re doing is connected to the agency itself, which means that it’s harder for you to share those case studies, those wins, those logos, you know, all of that stuff becomes very difficult because it’s not you. It’s all around the agency.

It’s a great opportunity that if you’re doing this right now or you’re thinking about doing it, I hope this kind of opens your eyes to what it really means and what the impact can be, the positives and negatives, but really the opportunity for you to step out into your own business or to put more weight. If you’re spending a lot of time right now where or maybe you’re at 60 percent with agency work, maybe you’re eighty percent agency type work.

Be aware because at any given moment or day, eighty percent of your income can disappear. You don’t have control over it, right? You’re building someone else’s business. You’re not building yours, so to course correct that you want to start more proactively marketing your own business.

You want to build your own brand. You want to get out there so you can shift this percentage and start to see significantly more direct client work that you are managing and engaging in which allows you to not only to build your business, create more value, have more control, but also allows you to earn significantly more and so you can be working the exact same amount of hours as you are right now, but as your own business and you know a real true consulting business owner, your income can double over it.

build your consulting brand

Not overnight obviously, but once you made the decision, it can start going in that direction because the aid, there’s no agency more taking 40 percent, 60 percent, whatever it is off the top.

That’s going to now go to your company, to your business, which allows you to reinvest more into building your own team if you want, or contractors or making other investments that are so many more opportunities can come your way because you have a lot more control. Freedom and flexibility by going to your own direction as opposed to only working for an agency, so hope that’s helpful and kind of illuminating the truth behind this model, the positives and negatives of it as well.

How We Can Help

Of course you can reach out to us through where we have a whole host of other resources, interviews, guides, programs to help you as a consultant, whether you’re getting started or you’ve been in the business for 10, 15, 20 years, but you want to get to that next level.

We can help. I hope that’s been helpful for you to illuminate the real truth behind the agency model and what you really stand to gain by focusing more on building your own business. Of course, you can reach out to us at

We have plenty of additional resources to help you to grow your consulting business and take your existing consulting business to the next level.


4 thoughts on “The Problems With Working For A Consulting Agency (Do This Instead)

  1. Hi Michael
    Thank you for a great video, which has pointed me in a better direction and inspired me.
    Best Regards

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