There are 4.1 million small businesses in California as of 2020. That is a lot of potential business for consultants. Starting your own consulting business in the Golden State could be lucrative depending on the industry you work with.
Before you start looking for clients
Opening a consulting business in California can be a great opportunity, but you need to make sure you’ve sorted all the legal requirements before taking on clients. The obligations you need to meet will depend on what type of consultant you are and the industry you work within. However, there are some general requirements that most consultants need to meet to do business in California.
Before you start looking for consulting clients, you may need to:
- Choose the correct business entity (sole proprietor, LLC, corporation, etc.)
- Obtain relevant licenses and permits (EIN, DBA certificate, zoning compliance, etc.)
- Understand applicable OSHA and California state regulations
- Take out any required insurance policies (Professional Liability, Workers’ Compensation, etc.)
If you have questions about how to set up your consultancy in California, visit the Office of Business and Economic Development website for more detailed information.
How to promote your consultancy
Once your business is set up, it’s time to start finding clients. New consulting businesses often use a combination of strategies to attract customers, so you may want to try all or some of the below to grow your consultancy.
1. Direct Mail
Renting or buying a targeted prospect list can help you directly reach potential clients. It’s easy for customers to delete an email, but a physical piece of mail is harder to ignore. A sales brochure, letter, or “lumpy envelope” with an enclosed gift can help you describe the services your consultancy offers and stand out from the crowd.
2. Cold Calls
Contacting people who aren’t expecting your call can be tough. Many people hate cold calling, but the personal touch it provides can yield results. Before you start dialing, practice and refine your sales pitch with a supportive colleague or friend. Even with a great pitch, be prepared for rejection. You may need to call dozens of prospects to find one client.
3. Paid Advertising
You don’t need a huge budget to run paid ads. Social media has created an affordable way for businesses to quickly reach targeted audiences. However, you can also use more traditional advertising channels if they better match your consulting niche. Specialized trade publications and magazines or even an ad in the Yellow Pages could help you reach new clients.
4. Industry Events
Networking face to face is another way to promote your consultancy. Attend events within your ideal client’s industry to meet people who may be looking for the services you provide. Depending on the type of event, you may be able to set up a table or stall to directly promote your business. You can also join relevant LinkedIn groups in your target industry where you can attract potential new clients by showcasing your expertise in group discussions.
5. Referrals
As you build your client list, referrals can be an easy way to get new business. If a client has had a positive experience working with your consultancy, they will likely be happy to refer their contacts to you. Once you’ve completed a job and verified that your client is pleased with your work, ask them to share your contact details with others who may benefit from your services.
6. Build Partnerships
Partnering with another consultancy may be a good way to reach new clients if you offer a very specific or niche set of services. Teaming up with another firm could allow you to bundle your services and widen your client base. This in turn could result in more referrals down the road.
Protect your consulting business with Professional Liability insurance
Consultants work closely with their clients, providing advice based on their professional expertise. A mistake or error in your work could lead to a financial loss for the client and put your reputation on the line. Professional Liability insurance can help protect your growing consultancy should this ever happen.
Professional Liability insurance can protect professional service providers from potentially devastating financial damages resulting from alleged negligence or error in the delivery of your services. Even if a client’s claim is baseless, a Professional Liability policy will help pay the legal fees associated with clearing your name in court. It will also cover any settlements or judgements you are ordered to pay, so you are not left out of pocket for these costs.
As your client list grows, Professional Liability can help protect your consultancy and professional reputation.
Find more information on Professional Liability insurance and how BizInsure can help you find the right policy for your consulting business.
