Consulting Fees

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Author: Derek Neighbors
Date:  
Subject: Consulting Fees
> In case you haven't lived in the real world, most consultants are NOT going
> to be billing clients based on a 40 hour work week. The actual number will
> be less than that, often far less if things are tight, and you have to pay
> the bills regardless. You're also expected to keep your skill honed in that
> same time, something that is not cheap in terms of time or money. Yeah,


Again we can agree to disagree. I dont think a client should pay for ones
inability to find work (downtime) or training (after all if they need to
pay you to learn, why not pay one a staffer)

> The last profitable consulting outfit I worked for charged based on a 3.2 or
> higher multiplier. (My current outfit is in startup mode.) My salary X 3.2


Yeah that outfit need to make a profit off you as well as pay you etc
etc.. We call that gouging.

> Ah, well if we're going to snipe at each other here, let's see. When I'm
> called in, it's usually after some FTEs (aka "headcount") have been trying
> to get something done for months or years, and have failed miserably. We
> usually get the job done in less than 30 days, and most of that is spent
> waiting for the full timers to cover their asses and provide information
> they should've had at their fingertips. Considering the money that was
> wasted paying the dead weight, I think I'm a bargain. While I don't actively


I think employees that dont perform should be cut. But justifying cost
based on lazy employees is silly.

> Slam my lifestyle, and I'll slam yours. Fun, ain't it?


Sure. Generally, I dont take discussions personally you seem to. I have
worked as an independent consultant as we well as a consultant for larger
consulting firms as well as a normal employee for both large and small
companies.

> If I go in and do a job that's going to save a client $100K+ a year, I don't
> think the $30-60K (not me, my company) typically charges is "highway
> robbery". If they COULD do it themselves, they WOULD. We're far less than


As they get educated and are able to hire currently starving programmers
(according to this list) they will. Just as people are leaving
proprietary software as they get educated.

> employees, and you don't have to pay us to keep our skills at a high level.


Ok so which is it? Should the companies factor in your cost your
'training'? or are you saving them money because they dont have to keep
your skills at a high leve? Im just curious?

> OK I don't actually agree with that, but that's the the other side of
> Derek's rather insulting slam. It's not pleasant when somebody gets on their
> stupid little soapbox and decides that the 15+ years I've spent in this
> business are only worth what they bring in themselves. It also explains why
> this market is getting so nasty.


I do apologize if I insulted, soap box sure, but it wasnt meant as a
direct slam on anyone.

> Derek, it's very good of you to decide what constitutes "enough" for your
> fellow professionals. However, I wouldn't be billed at what I am if I
> weren't delivering VALUE.


Well I was a 'high paid' consultant at one time and stopped because I felt
it unethical. I developed proprietary software at one time and stopped
because I felt unethical. Now I consultant often for free to non-profits,
schools and small business and work as a salaried employee for which I
used to consult.

-Derek