Pros and Cons of Becoming a Small Business Consultant
Small business consultants help organizations or businesses analyze problem areas and improve financial capabilities. Read on to learn about the pros and cons of this career.
| Pros of Becoming a Small Business Consultant |
|---|
| An expected favorable employment growth (19% for the decade 2012-2022)* |
| Above-average wages (median annual salary of about $59,000 for small business consultants in 2015 and $81,000 for management analysts in 2014)* |
| Advancement opportunities for qualified consultants* |
| Opportunities for consultants to be self-employed* |
| Cons of Becoming a Small Business Consultant |
|---|
| Keen competition for jobs* |
| Substantial work experience is typically required* |
| Some professionals work long hours* |
| Deadlines may cause stress* |
Source: *U.S. Bureau of Labor Statistics (BLS), **PayScale.com
Career Information
Job Description and Duties
Business consultants, also known as management analysts, help companies improve their overall cost-effectiveness, profitability and organization models. They analyze the business structure of a company, study personnel, read financial reports and study inventory. Consultants draw up proposals or system changes to aid businesses. They talk with managers or owners to confirm that the changes are working, and they readjust business models.
Small business consultants aid small, growing businesses by discovering new markets and finding viable means of reducing expenses. They also gather advice and recommendations from a variety of industry professionals. Small businesses may also need to understand what to do in unusual or rare circumstances, and the consultant provides information on standard and practical business practices for such occasions.
Career Outlook and Salary Information
The BLS predicted that management analysts have an expected 19% employment growth for the years 2012-2022, which is considered faster than average. This favorable growth may be due to all organizations seeking more cost-efficiency in today's market.
The BLS also reported that management analysts overall earned a median annual salary of about $81,000 in 2014. That same year, the highest ten percent of earners took home about $148,000 or more, while the bottom ten percent earned about $45,000 or less. In 2015, Payscale.com reported that most small business consultants earned anywhere from about $33,000 to $133,000 annually.
Requirements for the Job
Education
Small business consultants need to have at least a bachelor's degree, which is commonly earned in business administration. This degree can offer concentration options in areas such as marketing, accounting, finance and management, all of which could be useful to you as an aspiring small-business consultant. Some employers may prefer a Master of Business Administration. These master's degree programs could offer entrepreneurship concentration options and could allow you to engage in a consultant-training program, which could offer hands-on consulting experiences.
Experience
It's not unusual for employers to require years of work experience. You may consider working in a small business setting in order to gain experience on how such operations are run. Some experience may also be gained in internships offered by organizations, businesses and consulting groups. These internships can help you work with other experienced consultants and directors.
Useful Skills
You should have strong interpersonal and salesmanship skills to be a successful business consultant. Having a high tolerance for stress and a fast-paced work environment are also necessary to make the most out of this career. Other useful skills could include:
- Ability to work under considerable pressure
- Multitasking skills
- Strong communications skills (both in writing and talking)
- Ability to analyze financial and consulting information correctly
- Strong interest in business, finances and statistics
- Confidence and perseverance
- Ability to keep up with current financial, managerial and economic practices
Job Postings from Real Employers
In job postings for small business consultants, employers asked for at least five years of work experience. Strong communication skills and keen knowledge of business practices were required for most jobs. Here are some job postings that were open during May 2012:
- A consulting/coaching company in Illinois asked for a client development specialist with a bachelor's degree and at least ten years of work experience in a managerial role. The specialist should have been able to address problem areas for companies in topics such as manufacturing, financial services, technology, energy, retail, consumer goods and more. The job called for working primarily with local entrepreneurs and small businesses.
- A non-profit group in New Hampshire sought a small business consultant with a bachelor's degree and at least five years of work experience with small businesses. The applicants needed to have a strong understanding of business practices, business models and Microsoft Office Suite.
- A college in Texas needed a senior small business consultant with a bachelor's degree and at least seven years of work experience in running a business. The applicant also needed to be bilingual in English and Spanish. The business consultant would work evenings and weekends, travel to other locations, provide educational workshops for business owners and consult businesses on financial operations.
- A management services company in Florida asked for a senior consultant with a bachelor's degree and at least fifteen years of work experience as a business owner. The applicants should have had strong communication skills, the ability to travel and experience in improving the profitability of small companies.
How to Stand Out
Get Experience
Commonly, gaining work experience in the field of business will help you stand out as a potential consultant. Of course, to become a small business consultant, you would want to gain experience working in small businesses. Through this experience, you could broaden your knowledge of how a business is run by becoming familiar with subjects such as human resources and information technology.
Become Certified
Additionally, voluntary certification can help demonstrate your expertise in the field to potential clients. The Institute of Management Consultants USA, Inc. (IMC USA) provides a Certified Management Consultant (CMC) title to consultants who have met certain eligibility requirements, pass an interview and pass an exam. The CMC is available at the basic, experienced and advanced level; each level requires a significant amount of professional experience as well as a minimum amount of business and management education.
Alternative Careers
Administrative Services Manager
If you're interested in helping a business run more smoothly but you don't want to work as a consultant, you can consider becoming an administrative services manager. These professionals can manage a wide variety of support services for an organization including keeping records, delivering mail, distributing supplies and overseeing security standards. Work experience and a high school diploma alone could qualify you for such a job, though a bachelor's degree is sometimes required.
According to the BLS, administrative services managers were expected to see 15% employment growth for the years 2010-2020. The BLS states that these managers made a median annual wage of about $80,000 in May 2011.
Financial Manager
If you want a career with better earnings than that of business consultants, than you could consider becoming a financial manager. These workers help an organization prepare their financial reports and develop good budgets. Because these workers have important supervisory duties, they usually need to have a bachelor's degree and at least five years of work experience.
The BLS projects that these workers will see a nine percent employment growth for 2010-2020, which is considered slower than average. There is also substantial competition for these jobs. However, these workers earned a median annual salary of about $107,000 in 2011.
