What Should I Charge as an Independent Executive?

Similarly, the IT services rates per hour will also depend on the industry to which the client’s business belongs. For instance, e-commerce, retail chains, international import and export, government projects, and so on are usually priced higher than any other industry. Healthcare, space and research, education, automobiles, and shipping and logistics are a few industries where the IT consulting rates are pretty high. The first factor on which the IT consultation rates depend is location.

Some clients will prefer to pay consultants per hour, while others may want to pay per project or retainer. Rather than putting your foot down on one single method, it’s best to flexibly price yourself so that you’re earning what you’re worth—regardless of the systems and processes. Keep in mind, if the average consulting fees are around $100 per hour, your experience and track record will need to be taken into account. If you are a brand new consultant, you may be charging closer to $50 or $75 per hour.

Size of the Company and the Situation

For instance, the average IT consulting rates in Central Europe is $25-$50/h. You pay a monthly fee in advance to have consultants on your team anytime you need them and ensure they help make the right decisions during some risky project. Some companies prefer working with software developers, others looking for professional IT consultants. Both of these options are fine, while you get a high-quality service that matches your requirement. To get the best return of investment on your software development project, you need an experienced team of professionals who are dedicated to building top-quality products. Unfortunately, the web is always full of self-proclaimed “IT gurus” that offer sub-par tech expertise at a high cost.

It’s best to switch from a per-project or per-hour basis to a retainer fee once you have nailed down expectations for both you and the client. Plus, some clients aren’t sure what exactly they need, and you don’t want to get locked into a rate that doesn’t cover the entire scope. Many consultants and freelancers make the mistake of confusing average consultant rates with standard pricing—that’s not the case. Averages don’t take into account your value, the scope of work, client perceptions, or even your cash flow. While we’ll get into average consultant salaries and consulting rates by industry later, these are just averages.

Set Strategic Consulting Rates for Your Business

They can influence your decision-making, but your ultimate price point is entirely up to you. Yet, setting your consulting rates doesn’t need to be an anxiety-inducing experience that keeps you up at night. Done right, it should be a downright rewarding https://globalcloudteam.com/ experience for both you and the client. When you negotiate with a potential client, make them understand how your consulting services will affect their bottom line. Explain how your consulting rate will get them a return on investment.

• The same refers to crooked IT consulting agencies that don’t even have their own teams .
• For more on how to determine your rates, be sure to read our book, How I Fired My Boss and Made More Money.
• Remember that you don’t need to completely hand over your IT environment to a managed IT service provider.
• Even though hourly rates aren’t ideal, they are often the foundation of your pricing strategy.
• If you offer to do a job for less than you’d like, you will end up resenting the client, the project, and yourself.
• 0.76% of consultants are earning a whopping $250K+ per month.

This is because the professional will charge you for your business’s tools and software programs. Since these tools’ licenses do not come in a few bucks, you cannot expect the IT consulting prices to be nominal. Another best option you have for consultancy freelancers, especially when you have time and budget constraints. Furthermore, dealing with freelancers is much easier than with any company because these professionals usually work based on contracts. The market rate refers to the average price of the market or what the customers usually pay for certain products or services. While this does not serve as a mandatory ceiling on your prices, determining the market rate is crucial in structuring consulting fees.

Consulting Business Financials

But be warned that a good mentor will charge you a few thousand dollars a month or every few months. If you aren’t ready for this, you can read some blog posts and books or buy a course. This won’t be as straightforward as having a mentor as you will make many mistakes, but you will eventually get there if you put in the effort. The quickest path to becoming a successful consultant is to find a business coach who has already done it. A coach will help you reach your target quickly as you will avoid the mistakes that most newbies make. To help you answer the question, ‘how much should I charge as a consultant, here’s a detailed guide for you.

And to warrant the increase in price you should display your experience with some good case studies. For example, I once came across a guy who had a consultation fee of around technology consultant rates $2,000 an hour. There are several people out there who charge more than that. You can then go through all the pages on their websites to understand the services they offer.

Enterprise-level IT Consulting Firms

Your IT consulting firm will make sure all your project’s requirements are satisfied, and keep the project on track to meet deadlines. Assisting the client with other managerial tasks that require certain levels of technical expertise and advanced competency. Solving technical or business issues on behalf of the client in collaboration with an existing IT team and/or other departments. Defining IT project scope and coming up with realistic timelines and cost estimates. Recommendations for the best IT practices, technologies, and software products to bridge your organization’s vision, goals, and existing resources with up-to-the-minute IT market offerings and solutions.

From this, it’s clear how much do IT companies charge per hour. They usually take up projects worth $125,000 to $5 million. Based on the strength of the team and the project cost, the IT consultant hourly rate can be considered somewhere between $200 to $300 per hour. Clockify lets you track how much time you spend working on projects and automatically calculates your earnings based on your hourly rates.

Factors Influencing IT Consulting Hourly Rates

If you fall in line by charging the same as everyone else, you’re signalling that you’re a worthy consultant who plays fairly. You’re also making sure you get the base line rate for consulting in your market. Despite your best intentions, not all your clients will pay you. Some will take weeks or months to pay, but a small percentage will never pay the bill.