The cost of a freelance consultant vs a traditional consultant

Traditional consulting firms

As you work with external consultants, you get access to specialist skills that might be expensive to find and keep full time.

This becomes less of an issue with the cost of a freelance consultant being within reach.

This process of reaching out to traditional big brand consulting firms requires deep patience and deep pockets.

Currently, the available choices are loaded towards the higher end of the price spectrum.
This is applicable in both cases whether you reach out to big brand consulting firms or niche boutique consultancies.

Some of the big consulting brands refuse to take on projects that are not at a certain price. Overheads dictate the projects they can take on.

• Chasing margins

Consulting firms generally price their advisory services depending on the mix of consultants working on a project.

The larger the proportion of “junior” hours booked, the higher the margin.

This explains why the sharply dressed partner who sold you on an idea is swiftly replaced by the starry-eyed less senior (experienced) consultant when the project starts.

• Who’s working on your project?

The proposal that you get for a project from one of the big branded consulting companies, will always be the same rate regardless of who does the work on the inside.

The model itself is at fault, not the consultants themselves.

Reflect on that for a moment. The consulting companies expect clients to believe that all their people within a hierarchical category operate at the same level, hence they have the same rate.

These rates are not driven by competence, but by category (e.g. partner / manager / etc) and salary.

The ones with the highest rates are the ones who cost the firms the most and must be billed out the highest, but do the least amount of actual work.

Thus, spend the least amount of work on your project.

The highest rates are therefore not for the ones who add the most value, but the ones with the highest salaries.

It is assumed (without much science) that the higher earning consultants are the ones who will add the most value.

On top of the salary goes the firm’s margin, plus the cost of the flashy HQ building, plus the bespoke stationery, plus plus plus.

Open talent platforms as an option

Imagine for a second if a company is able to access these consultants’  skills directly, without having to pay for these overheads.
The cost of a freelance consultant looks miniscule in front of those big fees loaded with big overheads.

Platforms offer access to virtual freelance consultants, like One Circle, and are mushrooming with almost all reasonable business functions being represented.

The cost of a freelance consultant

Freelance consultants offer a  compelling alternative to the long existing traditional consultants.

The cost of a freelance consultant though is lower does not mean lower quality. On the contrary, a virtual freelance consultant, with comparable skills to a firm partner, typically charges a direct fee equivalent to that of a junior consultant.

As well, the ability to choose the specialist to work on your project, not just the brand, is powerful.

It is good to know that your project is not going to be pushed down to a faceless junior consultant midway.

Therefore, the cost of a freelance consultant being fair and even open-sourced is the cherry on top.

It is also refreshing to have external perspective undiluted by politics and future business development.

Many times, traditional consultants bite their tongues instead of offering practical solutions simply because of the relationship partner, or because it impacts future potential for business.

Virtual freelance consultants on platforms run their own businesses too, granted, but they seem more pragmatic.

Freelance consultants also select clients who they like working with. Its a two-way street.

The pandemic fast-forwarded many things, we hope that among them will be an upheaval of the staid consulting world.

In the freelancer revolution, finally, you have a viable alternative.

Keep in mind that the cost of a freelance consultant is just the cherry on top.
You get invaluable access to the freshness of thought, creativity and hands-on experience they bring into your business.