How to be an Information Consultant

Startup Costs

There are two ways to go about buying the equipment you need to launch your information consulting business. Your first option is to upgrade your office and equipment as needed. You can get by at first with an inexpensive computer, a few software programs, the least expensive internet access you can find, and the furniture and office supplies you have around the house. From there, you can slowly work up to a DSL line, a super-fast computer and the chair that looks like it came out of the bridge of the Starship Enterprise.

Your second option is to start out spending a bunch of money and be prepared for just about anything. If you have the money, get the best equipment you can right from the start. Why? Upgrading any part of your business will cause downtime--time when you're not doing work that you're billing for. Even switching to a new desk will probably cost you a day of work while you rearrange your office.

Here's a list of the average startup costs for an information consultant who's working from a home office (which is usually the case). Because it's assumed that you'll be starting out from the comfort of your home, this list of expenses does not include office space or equipment for additional employees. The costs shown are estimates based on reasonable expenditures for computer equipment, furniture and the like. For example, if you're buying a $3,500 computer and spending $2,000 for a Chippendale desk and chair, your expenses will be higher. If you're using a computer you already own and an old kitchen table for a desk, your costs will be significantly lower.

 

Item Price
Office Furniture $350
Computer Hardware $1,500
Computer Software $700
Phone & Fax Machine $200
Printed Collateral
(Business Cards, Letterhead Stationery)
$100
Phone Line Installation (Two lines) $150
Other Communication Devices (Cell Phone, Pager) $100
Miscellaneous Expenses
(add About 10% of Total)
$310
Total Startup Costs $3,410

Ongoing Costs

The monthly expenses for an information consultant are really pretty minimal when compared to other types of businesses. Assuming you're working at home, expect your electric bill to increase about $25 per month from running your office machines. Your ISP will charge around $25 per month for unlimited web access and e-mail. Throw in paper for your fax machine and consumables for your printer, and you're looking at about another $15 per month. Each phone line will cost you about $25 per month. So without including long-distance phone calls and high-speed internet access, you can expect to pay a little under $200 per month in expenses. With cable modem or DSL access included, it still comes to under $250 per month.

Depending on where your clients and contacts are located, your phone bill can sometimes be a frightening surprise. Keep an eye on it. Send faxes at the least expensive times of day (some fax machines have this feature built in), and bill your clients for any long distance calls you make on their behalf. You may also want to shop around for the least expensive long distance service available in your area. The difference between seven cents a minute and ten cents a minute may seem small, but it really adds up if you spend a lot of time with the phone attached to your ear. Some long distance companies even offer perks like frequent flier miles that can make them even more attractive. You have to take a vacation some time, don't you?

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