In the modern world of entrepreneurship, any solution aimed at optimizing processes, developing new directions or increasing efficiency is often associated with an appeal to professional consultants. However, since the origin of business consulting practice around it, many myths and speculation are hiding around it. The main one is the high cost of services and a dubious return on investments. In this article, we will figure out in detail what the consulting price is made of, what approaches experts use in the formation of tariffs, and how to understand that the services will really justify themselves. In addition, we give real examples of the return of investments to dispel popular delusions.

What is business consulting and why it seems expensive

Business consulting is usually understood as a wide range of services: from the audit of processes and financial condition to the development of corporate culture and the introduction of innovative technologies. The main goal of the consultant is to identify problem points, offer ways to decide them and support the client at the stage of implementation.

The main reason why consulting seems expensive is the perception of human capital and knowledge as an intangible resource. Clients are used to evaluating the effectiveness of the amount of goods or time, while the consultant sells expert experience, deep analysis and changes management skills. In this case, the current cost consists of several components:

• Qualification and reputation of the expert;
• The complexity and scale of the project;
• The necessary volume of research and diagnosis;
• Time spent on the preparation and implementation of decisions;
• Additional expenses for software, field meetings, materials.

Approaches to pricing in consulting

There are three main pricing models that use consulting companies and independent experts:

1. Honor payment

The consultant sets a bet for an hour of work. This model is transparent and convenient for brief tasks - conducting training, consultations on a specific issue or expert opinion. However, with long -term projects, payment for a clock can lead to unjustified increase in the amount due to sudden additional tasks.

2. Fixed fee

In this case, the consultant and the client will pre -agree on the full amount of work, the terms and total cost of the project. This approach is convenient for integrated projects with clearly registered stages: audit, development of strategy, implementation and control. The recorded amount protects the client from unexpected rise in price, but imposes liability for a consultant for compliance with the budget and deadlines.

3. Payment on the result

A less common but effective model in which part of the consultant’s remuneration depends on the indicators achieved (increase in profit, cost savings, performance growth, etc.). The client pays the basic amount for the analysis and part of the remuneration when he reaches the agreed KPI. This format unloads the budget at the start and motivates the consultant to concentrate as much as possible on achieving goals.

Components of the cost of the consulting project

To understand how much you will pay for services in the end, we will analyze the main cost items:

• Initial analysis. Collection and processing of data about the enterprise, verification of documentation, interviews with key employees.
• Development of recommendations. Preparation of a report with a plan of events, the selection of tools and resources.
• Implementation of decisions. Staff training, changes, control of key stages.
• Monitoring results. Evaluation of efficiency, adjustment of the plan, re -departure of the consultant.
• Additional expenses. Presentation miles, rental of conference halls, software licenses, business traffic.

Each of these elements can cost differently depending on the level of experts, geography and the duration of the project. So, the average hour of the experimental consultant in Russia varies from 5,000 to 15,000 rubles, depending on the profile: strategic, financial, IT or HR consulting.

How to evaluate the payback of consulting services

The most practical way to understand whether the costs will be justified - to make a preliminary assessment of the expected economy or an increase in profit. This is necessary:

• Formalize current performance indicators: revenue, margin, cost, labor productivity, key operations.
• Determine the target indicators after the implementation of the recommendations: what growth or reduction of expenses to be realistically obtained in the next 6-12 months.
• Make a financial model: compare consulting costs and the expected financial effect.
• Calculate the payback period: divide the amount of investment in consulting into monthly or annual savings.
• Assess additional value: improving reputation, increasing customer loyalty, reducing operational risks.

Correct setting of tasks and a clear understanding of the desired results help reduce uncertainty and obtain a reliable prediction of the payback at the negotiation stage with a consultant.

Examples of investment return

To dispel doubts, we will give four real stories from the practice of companies that turned to professional consultants for help.

1. Production enterprise: cost reduction

Client: a plant for the production of plastic products, turnover - 800 million rubles/year.
Task: Optimization of production processes and reducing the cost of raw materials.
Solution: implementation of a lean production system, reorganization of warehouse operations, revision of contracts with suppliers.
Result: savings 15% per year (about 120 million rubles), consulting costs - 12 million rubles. The payback period is 1.2 months.

2. Retail: Increase in turnover and margin

Client: a network of grocery stores, turnover - 2.5 billion rubles/year.
Task: to build effective promotional campaigns and a loyalty system.
Solution: audit of advertising costs, segmentation of the client base, the introduction of personalized proposals.
Result: an increase in revenue by 8% (200 million rubles) with additional margins of 25%. Costs - 20 million rubles, payback - 3 months.

3. IT company: acceleration of development and reduction of costs

Client: developer of mobile applications, revenue - 150 million rubles/year.
Task: optimization of development processes, deadlines and reduction of bugs.
Solution: Implementation of flexible methodologies (Scrum, Kanban), testing automation, team training.
Result: a decrease in the release time by 30%, reducing the cost of correcting errors by 40%. Savings - 18 million rubles/year, costs - 6 million rubles, payback - 4 months.

4. Financial organization: risk management and loss reduction

Client: Leasing company, portfolio - 3.2 billion rubles.
Task: Reducing the share of problem loans.
Solution: Development of a scoring model, implementation of an early warning system, training in risk management.
Result: a decrease in overdue debt by 50%, a decrease in reserves by 120 million rubles. Investments - 15 million rubles, payback - 1.5 months.

How to choose "your" consultant

In order not to overpay and get quality services, pay attention to the following criteria:

• Experience in your industry and successful cases.
• Transparent pricing model and reasonable agreement.
• The presence of a project structure with stages, KPI and control points.
• The readiness of the consultant to take on part of the risks through payment by the result.
• Customer reviews and reputation of a company or expert.

Risks and how to minimize them

Even with a competent approach, there is always the possibility that the expected indicators will deviate from the forecast. To reduce these risks, act like this:

• Lay in the budget a stock for unforeseen expenses (10-15%).
• Fix the consultant's obligations in the contract: terms, metric, reporting.
• Follow intermediate results and adjust the plan together with the expert.
• Ensure the involvement of the client’s team: without support for personnel, the introduction of innovations is unlikely.

When all parties clearly understand the goals and obligations, the chances of successful implementation are significantly increased.

Conclusion

Business consulting does not have to be unbearable expensive. The cost of services consists of the qualifications of specialists, the volume of work and the complexity of the project, and the transparent payment model and a clear setting of goals help to accurately assess the payback period. It is important to determine the key metrics in advance by which success will be measured, and choose the payment format - hourly, fixed or “according to the result” - taking into account the specifics of the task and readiness of the consultant for the separation of risks.

With a competent approach, investments in business consulting can return themselves in a few months, and sometimes even in the first weeks after the implementation of decisions. The debunking of myths and an understanding of the cost structure, a thorough choice of a partner and timely process control will allow the maximum return from professional recommendations and display the company to a qualitatively new level.