NFIB

Benefit From an Outside Consultant
10/ 14/ 2003

by Jeffrey Moses

While successful small business owners are often knowledgeable in a variety of crucial business areas, no single person can be a true expert in every field. There are events and stages in the growth of every company that are so important to the company's eventual success that they demand expert handling.

Often, management consultants and specialized experts can be hired at an hourly fee. When lengthy consultation is required, always meet first with them to discuss your specific needs and evaluate their expertise in the field and with companies of your size and type. Consider enlisting the help of a consultant when dealing with the following:

Purchasing or leasing major equipment: This includes buying computer systems; telephone systems; land and buildings; and equipment specific to the industry such as fleets of vehicles, printing presses or bulldozers.

Experts in purchasing (often found through trade associations) can greatly minimize the chances of making mistakes or overspending. Note: don't limit your consultations to the agents selling the products you're purchasing. It's nearly impossible for agents to be completely unbiased when discussing a sale from which they will profit.

Selling your business -- or buying another business: This is a major purchase that could affect your entire business career. Meet with independent management consultants trained in buying and selling businesses. Don't limit your consultations to business brokers that will directly profit from your transactions.

Internal productivity or morale problems: You should bring in a management consultant who can take an objective viewpoint of your company's inner situation, both operational and psychological.

Dramatic changes in your industry: When a company needs to make the transition from one era to the next, outside experts could save you an immense amount of time and money. The consultant will perform a complete analysis not only of the industry and the changes it is going through, but of your company's goals and internal operations.

Risk management as you expand: This often-underappreciated aspect of growth requires expertise. Some insurance agencies specialize in small-business risk management -- but they may be somewhat biased in some ways because they also sell insurance products. While working with an insurance broker, consult also with an independent risk-management expert.

Offering new products: As a business owner, you may feel competent to make decisions about integrating new products into your offerings. But when contemplating taking on entire new lines, you may benefit from management consultants experienced in this activity.

Bid and proposal creation: When making an extremely important bid or proposal, consider paying for a few hours with a management consultant. You should prepare a draft of the bid -- and take all pertinent information with you to the meeting. A good consultant will want as much information as you can gather about the customer's operation and goals.

Regulation compliance: When setting up or expanding a business, get it right from the start by spending a few hours with someone who can give you definitive answers about often-confusing government regulations.

Going public: Making an initial public offering or becoming a director of publicly owned company could be intimidating and overwhelming. A consultant who has worked with IPOs before can help you make a smoother transition.

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