It can be difficult to figure out how to find your first clients and sell to them at the right price. In this episode of Marketing for Consultants you’ll hear Richard Newton share his insights on how to run a successful consulting business, how to find clients, and why he has published 13 books and counting.
How to Build a Successful Consulting Business with Richard Newton
Three take-aways from what Richard said:
- Writing is marketing, and this echoes what Jonathan Stark said back in Episode 2.
- The second thing is about how your style of working with clients can be a major point of differentiation between you and your competitors. I’m always thinking about differentiation, because it’s what sets you apart from your competitors and one of the things that allows you to charge a premium.
- And finally, his point about skills aging very quickly now and it being important to rethink and continuously revisit your business strategy. This fits in with how your positioning statement as something that regularly evolves, rather than being set in stone.
Links mentioned in the show:
Richard Newton is an experienced independent consultant, freelance writer and company director. During a career that has spanned over 30 years he has developed a reputation as a true trusted advisor, able to work in a variety of contexts to support organisations and individuals grow and change. He is well known as a business author, with several best-selling books to his name.
Richard Newton 00:00
I mean, to me differentiation, there’s kind of three angles to that to me. So one is what I do, which we talked about my service line. The other is, who’s my customer who I do it for. But I do think there’s a third which is also about the style with which I approach the things I do. And that one often gets forgotten the way you work with people in the style is a really differentiating factor in your work.
Alastair McDermott 00:32
Hello, and welcome to Marketing for Consultants. This is the podcast that helps independent consultants and subject matter experts to get more clients without having to beg for referrals or make soul-destroying cold calls. I’m your host, Alastair McDermott. And today my guest is Richard Newton. Richard has been involved in the world of consulting for almost 30 years running his own company for the last 15. He has written extensively about the profession with 13 published books translated into 17 languages. So just to give you a flavour of that, his books include “The Management Consultant: Mastering the Art of Consultancy”, “The Project Manager: Mastering the Art of Delivery”, “Change Management – Financial Times Briefing Series”, and his most recent and newly published book is “The Freelance Consultant: Your Comprehensive Guide to Starting an Independent Business.” So as you can see, he’s he’s perfect for this show. So for me, personally, Richard is one of those guys in my network, who I will reach out to you when I’m looking for feedback and some genuine constructive criticism. He’s a super smart guy, he’s usually experienced, and during this conversation, he will share a tonne of valuable advice. So my first question for Richard is, why have you written “The Freelance Consultant”? And what is it all about?
Richard Newton 01:41
Yeah, what I wanted to do was, write in one book, what I think of as the lifecycle of work of a freelancer. So I didn’t want to focus on a one specific area, like how do you sell? Or how do you make sure you get paid, those are all important things. But what I wanted to do was to give a framework we said, from A to Zed, this is the set of things you want to do. And I take take, take the reader through a lifecycle from thinking about your business in the first place, through, you know, kicking off on your first day, making those first sales, how you keep the sales coming in how you make sure you get paid, but then how also you keep your skills fresh, how you build customers who trust you, and we’ll come back to so I wanted to, I wanted to give you like an end to end framework that says, this is all the things you need to do as a freelancer, and it stresses, you know, stuff about how you’re good at your job, but also how you run your business. Now, you know, there’s obviously a balancing point in the book, because you don’t want to book size of an encyclopaedia. So, but I think it was important to have that. So someone who is new to the field can say what’s all the things I need to do, they’re all in there. But also someone who has been around for a while and saying, I struggle with x, I struggle with y, it’ll kind of give you pointers to where you Where else you may need to go. Now that does mean that sometimes in some areas, it says, you know, this is this is about pricing. But you may well go and be able to buy a specific whole book on pricing. But it’s trying to put that in context with the whole life cycle of your work. Yeah,
Alastair McDermott 03:15
Yeah, absolutely. And, you know, I think that it’s, it’s something that can be a bit of a shock for people, where your your income is not determined by how good you are at doing, you know, your area of expertise. But it’s also determined by how good you are at marketing yourself. That business development, at building relationships, as determined by all these other factors, I think is really, you know, it’s really great to have a resource that kind of collects all those those things together.
Richard Newton 03:45
I’m going to even step further than that. And I’m sure there are exceptions. But all the people who you meet who are who have really cracked in the freelance field, they are good at relationships, they are good at marketing, they are good at sales. Actually, quite often, they’re not the world’s best at their, funnily enough at their absolute subject matter. And the reality there is very few clients need the world’s best. But most clients want someone they like working with who they can trust, and they have a good relationship with. And it’s it’s often worth focus on sort of knows now it doesn’t mean you’ve obviously got to be able to do the work, you’ve got to have that basic skill set. But it’s better to be focused, I think on other things like, as you say, like getting your sales technique, right. Working out, what how am I going to market myself? Is it going to be content marketing? Or is it going to be something else? And how do I make sure that a client when I’ve done a piece of work buys me again, and just doing a great job isn’t the way to do that you have to build that relationship with the client such that they’ve enjoyed the experience of working with you. So that it’s a much broader skill set than I think you might imagine if you weren’t in the field in the first place.
Alastair McDermott 04:54
Yeah, and I think it goes back a little bit to Michael Gerber and the E myth where he talks about you The E myth is the entrepreneurial myth, which is that somebody who is good at doing a thing is automatically good at running a business that does that thing. And that’s not the case you need to, you need to scale up on the whole business around it.
Richard Newton 05:15
Yeah, and I think if, you know, if, if if, if I was going to tell you a myth, and then one has come into my head, a myth that I think pervades out there is that you need to be a guru to to be successful x successful successfully selling expertise? Absolutely you do not, you need to know enough, that’s a value to that client and can crack their problems. Beyond that, you know, you don’t need it. So I’m not trying to say you need to know nothing, you do need to know stuff. That’s what you’re selling, how to do things. But no more, you need to know no more. And in a way, I hope that’s refreshing, because although I think it’s a big bundle of skills that you need to be a good freelancer, I don’t think you need to be particularly expert in any of them, you just need to find the right balance of them for yourself.
Alastair McDermott 06:08
Let’s talk about the fact that you’ve written all of these books. And I have another one of your your most successful books here. The Management Consultants, which which is also from the same publishers, can we talk a little bit about why you write so many books and how that’s important for you?
Richard Newton 06:24
Yeah, I mean, I, you know, the first thing is I write because I like writing. So there’s a lot of business books in the market. And, you know, I think over the last few years have been it’s become easy to write in the sense of, it’s easy to self-publish, and things like that. So, you know, there’s writing as a business domain, and it’s something that drives your business. And that’s something I do, but I mean, my initial drive for writing was I like writing. So it’s, it’s a, it’s a passion of mine. Secondly, the nature of consultancy work. And it’s the nature of, of a lot of people who are in kind of in trim or freelancing is, I’ve got lots of times when I’m very busy, but I’ve got downtime as well. And I like to use my downtime. And normally, I then write a book. And the genesis of a book for me is always I make some observation, I make an observation. And I think, oh, and that drives me to a question and I basically write a book to answer that question. Sometimes it’s one question, sometimes it’s a series of them. But normally, it starts with, with one observation, in fact, my very first book started with a very specific observation, and then I worked on from then.
Alastair McDermott 07:28
I like the use of the downtime, that’s very clever. It’s something that we see in this feast and famine cycle, we do see those downtimes, although I think a lot of people would be using that downtime, to go scrambling around looking for more clients, whereas you’re actually doing something that is not going to get you clients immediately. So it’s kind of a longer game, right?
Richard Newton 07:48
That’s correct. I mean, book writing has many advantages and can help open doors, but it is not an immediate sales technique. It’s It’s It’s more like marketing and sales, if I can be kind of pedantic that way. Yeah.
Alastair McDermott 08:00
Yeah. So writing for you is marketing.
Richard Newton 08:02
Writing is marketing. It’s also just a personal aspiration. So I get a pleasure out of it. It’s a marketing activity, it brings in a revenue stream in its own right. And it does have a little bit of that earning while you sleep, but as anybody who’s knows books knows, it’s not a huge revenues seem even though I’m quite a well known author, but it is predominantly a marketing activity. Yeah,
Alastair McDermott 08:25
I know, you talk about the motivation and bromine, you know, you have an observation, which leads you to your question, to answer a question. Are you being strategic about writing for your clients or writing for your potential clients?
Richard Newton 08:38
I think I’m a mixture of both. I’d be lying if I said every book I’ve written has been strategic, there’s there’s a whole there’s a whole raft of them. And some of them have been purely. All that looks interesting. I’m I’m I’m one of those people who’s in danger of going down rabbit holes quite often. And some of my books represent that. But there are specific books I’ve written for specific purposes. There are a couple of books I’ve also written because I’ve been required to be commissioned to write them. So the publisher has said, we think there’s a gap in the market here. We think it’s a gap, you know, so would you write for it? Sometimes? I’ve said no, but in a couple of times, I said, Yeah, I have done. The interesting thing for me, the books that publishers have asked me to write have generally not been the ones that have done well, the ones that have done well have been the ones where I’ve spotted and I don’t think that’s about me. But that’s just about people in a business tend to know it better than people like publishers and people external to it.
Alastair McDermott 09:28
So have any of your books been self-published?
Richard Newton 09:31
The only book that’s been self-published is a novel. So that’s a completely different different domain. All my business books have been a been publisher published. And you know, there’s always that discussion about what’s better. And it’s kind of pros and cons. I tend to go with the publisher because I think the brand helps the publishing brand helps and you get a really nice quality product at the end. But But there is a good market and I certainly often I wouldn’t discount self-publishing for the for the right book and there are certain topics which don’t suit publishers because they’re too niche. And then self-publishing is definitely the way to go.
Alastair McDermott 10:05
Yeah. And I can actually physically feel the difference, you know, with the weight and quality of the of the binding and the print and everything I’ve seen, and I’ve helped people do a lot of self-published books, it is very hard at the, I think the scale of print, it’s very hard to get that same quality of kind of look and feel. I have Jonathan Stark on here. And we were just talking about writing and speaking, his whole mantra for consultants is you write and you speak, some form of writing. And that could be books, could be blogs, could be emails, and then some form of speaking, which could be you know, doing podcasts like this or actually speaking in conferences when we can get back into the real world and do that. So do you also have that that speaking part of the of the equation?
Richard Newton 10:54
I do, although it’s a smaller niche, and somebody like Jonathan, it’s much more targeted at specific, specific things, and I do particular events, I’ve got a series this year for a number of clients. So yes, I do. I mean, I think I think there are different routes and different ways people sell. And there are different ways people make business. So I think for me, the the the writing speaking combination has worked. For someone like Jonathan Stark, it’s works in a different way. But I wouldn’t discount I do know, plenty of very successful consultants who don’t write or don’t speak, and they’re still successful. So I think it’s about the way you engage with your customers and drive business, and what sort of consulting you’re selling.
Alastair McDermott 11:33
Right? And is that a business model choice?
Richard Newton 11:37
Yeah, I mean, I suppose it is a business model choice. I mean, I think I think that a lot of people are not particularly strategic about it. But I, you know, if you have very deep relationships with a set of clients, which you’ve built over years, and you are generating a significant amount of revenue from those clients, then actually, you may not need to do any more than keep that relationship going. And And I’m not talking about people scratching your living out. I mean, I know people who making very substantial sums of money of a small group of clients with whom they have that deep, trusted advisor style relationship. So I think writing and books gives you a different dimension, and it can give you a different sorts of sales. But a lot of the people writing you know, some my books appeal to people like me, not all of them appeal to my clients. So you know, there is there is an element of if you’re, if you’re writing to, to sell, you need to be writing for your clients. So if you look, a lot of my books, my books are consults consultants. My clients are typically not consultants. So those particular books are not for my clients. They’re for other reasons, maybe selling speeches talking and things like that. Yeah.
Alastair McDermott 12:47
Right. So Alan Weiss is one of the authors on the bookshelf behind me here. And he is he’s a very, very prolific author as well, I think he’s probably into the 40s or 50s. Now at this point, in terms of number of books, but he is specifically writing for the consultant market, because I was just looking at the parallels between you and him, because you’re very prolific yourself. And it seems like he’s being particularly strategic about where he’s aiming his books, whereas yours, you seem to have kind of a broader a broader topic, reach.
Richard Newton 13:23
Yeah, I think that’s true. I mean, I think if you wanted to look at someone who’s really cracked the writing books to drive a business, then I think Alan Weiss is a very good example. And I wouldn’t claim to have cracked it to the same way he has. And if you look at my books, they to some extent, follow my career in terms of the areas and domains I’ve been working in. I’m a really big for writing about what I know, not about what I don’t know. And so it’s full of my career. Have I always got it strategic, right. Absolutely. No. But but I’ve been doing it probably for slightly.
Alastair McDermott 13:59
Yeah. Yeah. Well, let’s talk about the The Freelance Consultants then, which is the latest book, and I know that you talk about what are the topics I noticed was designing your freelance business, which to me means you know, picking a business model strategically, which I think is one of the most important things that any consultant can do. And we talked about that for a little bit.
Richard Newton 14:23
Yeah, I mean, I’m, I’m, I’m, let me let me just take you back one step though. And, you know, I talk about all these books with an outward start with an observation. And I think my observation was that I saw a lot of freelancers, and they’re really not just consultants, the titles the consultant, but it’s really aimed at that freelancer who’s selling expertise, whether they would classify themselves a consult or not. And there’s a lot of people in that field who some of them doing fantastic, but a lot of them are sort of sort of I put in the last category, in the sense of you see, they can’t quite get the their act together and they they struggle to get enough work and and a lot of that comes to the fact that they’re not specific enough about what actually is the business I’m in, what is it? I’m trying to do? What do I want to achieve out of it? And it’s, it’s, it’s it’s finding answers to questions like that, and particularly the, what is the business I’m in? And what do I want from it? If you, if you like, for me are the fundamental questions that drive what you need to do.
Alastair McDermott 15:23
Yeah, I’ve been there done that bought the T shirt. I was in that last category, probably three, four or five years ago. And, you know, I’m completely with you here. Yeah.
Richard Newton 15:33
Yeah. And you know, and I think I think there are a few people have just fallen on their feet. I love to say that I’m writing it from a book proposition where I’ve never been lost. Of course, I’ve been lost as well, you know, there are times I’ve been thinking, what what’s, what’s this? And actually, I think that’s going to be a really important point for freelancers in the over the following decades. Because all the evidence is that the best of skills age very, very quickly now. So there is an element of not just doing it once but continue to rethink, what is it? What’s the business? I mean, and we need to be prepared, if we want to be freelancers to be doing that on a quite a regular basis.
Alastair McDermott 16:08
Let’s talk specifically then about actually deciding which services and which customers to pick, because I think that’s what you talk about a bit in that section. I think you call it designing your freelance business.
Richard Newton 16:20
Yeah, I suppose. I suppose what I’m trying to do in there is that we’re a lot of people start is they say, I know x, I’ll try and sell x. Yeah. Whereas there’s, there’s a sort of set of fairly basic questions that start with, okay, is there a customer for x? Do they have any money? Are they the sort of people who spend it? Can you get access to them? And they’re not difficult questions. In some ways, they, they’re obvious, but I think far too few people start with that sort of mindset. And if you look, if you if you stepped outside of freelancing and consulting, and said, I’m just gonna stet set up a business, you know, all the evidence from the last probably the last 100 years. I mean, it’s been the best businesses start with a viewpoint of what is it that customers want? I mean, even if it’s not specific, but generally, that viewpoint of what the customer is resenting too many consultants start and too many freelancers start with the, I know some stuff, how can I make money from it. And it’s not that the two aren’t related, of course, you’ve got to know something to be able to sell it. But it’s, it’s, it’s the nobody owes you a bit and nobody owes you a living. And you need to be especially conscious of that, as a freelancer, it means you’ve got you’re facing that every day. And therefore sitting down and thinking through, okay, what is it that that that that there? Actually, there’s a customer for that I can do. But I also think there’s another side of it, which is, why are you in freelancing in the first place? Because there’s lots of great jobs around? And if you’ve got a good skill set, why are you in a job? And the answer is because you want something or a hope? The answer is you want something that the freelancing life gives you. Like, I want to work three days a week, or I want to make a tonne of money. And depending on those answers, you’re going to come up with a different design for your business. And I think you need to be the most successful people. And by success, I don’t just mean money. I mean, the people who have fulfilled, what they set out to do, are the ones who are most specific on that and clearest about that, you know, I know people who’ve said, I only want to do remote working. Now, that means they’ve compromised on some other things, but they’ve got there, or I only I only want to work six months a year. Now, they have deliberately compromised their ability to make money. But they’ve got that and I think they gets that design of what is there an apt an appetite for in the market that I can sell plus, does it get me what I want from this very few of us actually want? You know, the dream is to be a freelancer. I mean, if that if you know that it as an end in itself, there is always some other purpose. And it’s been clear about that purpose.
Alastair McDermott 18:56
So if we take somebody who is starting out there, maybe they’re in that last place, maybe they’ve managed to to kind of scramble up to where they’re earning maybe 30-40, 50,000, let’s say dollars a year. Where did they go? If they’re if they’re in that starting point? If you and you were talking to somebody like that, where would you advise them to look at what would you advise them to consider?
Richard Newton 19:20
Well, I mean, first point I’d asked them, and you know, and it’s interesting that you pick that is, what is it about 30, 40,000, $50,000 a year that that gives you a hunger for something else? Because one answer is, well, maybe you can earn 30, 40,000 and have a low pressure life. But assuming you want to earn more, then there is a there’s that kind of process of thinking through what well, what is it? What is it more that there would be in market appetite to buy. And I often think that that is a desire to be completely original, or there’s a desire to copy other people in the true path is somewhere in the middle which is we’ll look at Who else has been successful? And what are they doing? What can you learn from that? And take those models and see how you can apply it yourself? So I don’t think there’s a trite box of tricks. But I do think there are there are there are there are some relatively straightforward questions you can ask. And you know, for example, if you took that person of 30 40,000, a year, is that is they earning 30 40,000, rather than, say, 150,000? Because they’re not fully utilised. Or because they’re billing at a lower rate. And those those points to two different one is, one is a sales activity. The other is an activity about how do I increase my rate, which has a different set of answers. So it’s back to specifics
Alastair McDermott 20:41
For that low value work?
Richard Newton 20:43
Yeah, absolutely. Yeah. And if you take that one as an example, often the the answer is having the confidence to say no, because once you want to accept the low value work, actually, it fills your time. Well, you’re never going to be doing high value work, if you filled all your time with low value.
Alastair McDermott 21:01
Richard Newton 21:02
That almost sounds suits too simple to be true, but it often is the problem.
Alastair McDermott 21:05
Yeah, and in fact, I actually even even have a posted on my, my, my screen here, which says “Say no more often.” And it’s something that I you know, over the last couple of years that I’ve been trying to tell myself, you know, there’s there’s, there’s an opportunity cost a very significant opportunity cost to saying yes to something. And if it’s not a high value. Yeah.
Richard Newton 21:29
I think I think that’s something to remember. I mean, some people come into freelancing. And they what they want to do in the end is what I call build a pyramid. So they want to sell themselves and they suddenly want to start selling more people. That’s kind of a you know, they want to build a bigger business. But let me park that as an aspiration for a moment and think, as a freelancer, actually, I want my independence, I just want to be working with myself for myself, obviously, I’ve got clients, but it’s just me, well, then it’s always important to remember, well, if you’re a normal person, you’ve got five days a week and eight hours a day. And that’s what you need to sell. You don’t need to sell him. You can’t sell any more than that unless you want to put yourself in an early grave. So it’s how do I maximise those, and you’re right, part of the challenge is always the opportunity cost of saying no to things that don’t fit.
Alastair McDermott 22:11
Well, thing you’re talking about is how to actually find your your first clients and sell to them at the right price. Can you talk a bit about that?
Richard Newton 22:20
Yeah, I again, I don’t think there’s a silver bullet here. So but but there is an activity where we’ve got to find clients. And the first place I always sell to say to people, when they’re looking for clients is where who do you know already? Who do you know already? Why that whether if they are directly buys themselves, or they know people who are going to buy. And so there’s there’s there’s there’s that kind of let’s just use our natural network that we’ve got, then it comes back down to business model. And as you know, from the book, we go through different different ways you can reach clubmark, reach a market, whether it’s your direct sales, whether it’s going through third parties, and they’ve all got pros and cons, but they depend in the end, the choice comes back to what is it that you want out of it? So I think it’s about thinking about that kind of what is your route to market to us kind of old fashioned marketing speak? What is your route to market? And therefore is it a route that’s going to give you what you want. But you know, individual sales? Start with your personal network, that’s what I would always do. And that’s not saying that they are going to buy but if they’re not going to buy, who do they know that’s going to buy? And one of the one of the things I find with some people is they don’t really like using their own network. And an economy responds to it is well, if you don’t like using your own network, who who would you like selling to? Because it’s it’s it’s it’s an activity, which requires you to engage with somebody sometime. So start with those people, you know.
Alastair McDermott 23:49
Yeah, I know, there’s a lot of people out there who maybe got into consulting through a side door, as, as Philip Morgan calls it, and they may not have the right network, or they may have a very small network. And so they’re trying to figure out, Okay, how can I make this work in that scenario?
Richard Newton 24:09
Yeah, I and I think that so let me step back a second, say, you know, one of the things I’ve tried to do in the book is if you’d like cover a whole range of basis. And if you’ve come into consulting, as you say, through a side door, and you’re there and you haven’t got a you’ve got a small network, a small network in itself is not a problem. Because again, you don’t need that many contacts to sell to it might be the wrong network, though. So then there is those those approaches and they’re on well known techniques for going out and building networks for prize for approaching the groups of people you know, and it’s that old it’s often you know, to try the said, but it’s it’s true that there’s no no value in having 10,000 people in your, let’s say, your LinkedIn network, none of whom are potential clients. Much better to have 200 people that have 100 former clients, and then you get into that technique of “Well, okay, so how do I get visible to them? How do I get to know them? Do I approach them directly? Do I start producing content which appeals to them?” All those ways, which then start to drive conversation. And the point about the point about consultancy sales, as opposed to some other services is a consultancy sale to me, basically starts with a conversation, it doesn’t start with somebody knocking on your door saying, Can you do x that rarely happens, what happens is, you start to have a conversation and through the conversation through dialogue, you find roots, and you get to understand current customers, and you start to see the places where you could add value, and they start to understand where you can add value.
Alastair McDermott 25:37
The other thing, I think that’s important, based on what you just said, is having specifically identified who an ideal client is because you can’t build up that network of ideal clients if you don’t know who they are. So actually picking is is really important, right?
Richard Newton 25:54
Yeah, no, I think I think it is in the people like the you know, all the people I know who are very successful, have very clear clients. That’s not saying they wouldn’t sell to somebody else, but they’re not going to actively go out and working at finding them, they’re going to be really specific. And they might be down to an individual job title in an individual type of firm in an individual sector. You know, so, you know, I know people who help finance directors in firms with 500 to 2000 employees with a particular sort of problem. And it might sound too niche, but no, that’s what they do. And they managed to drive a business through that. And niche is always the way to go. And niche starts with understanding your customer and your customer type. Now, it may not be business, it might be, you know, you might be helping people. You know, let’s say back to work after maternity leave, you know, it’s a very specific thing. But it’s still a particular niche. So yes, I think being clear about your customer, and that plays into a number of things for a start your service lines, then appeal to that customer. If you’re producing content, books, blog posts, whatever it else is, they’re targeted at that audience. If you don’t know who their audience is, they’re always going to be written for a general audience and therefore inherently less appealing to the specific audience.
Alastair McDermott 27:08
Yeah, absolutely. Yeah. I’ve I’ve discovered that myself in the past and trying to write for a general audience is also very difficult. It just it feels like so bland, it’s very difficult. It’s very hard to to actually create the content.
Richard Newton 27:23
Alastair McDermott 27:24
Okay. So one of the other things that you mentioned that this kind of think this is maybe along the same lines is about being a differentiated consultant. Can you tell a little bit about differentiation, what that means to you to differentiate yourself from everybody else out there.
Richard Newton 27:40
Yeah, I mean, to me differentiation is, there’s kind of three angles to that to me. So one is what I do, which we talked about my service line, the other is, who’s my customer who I do it for. But I do think there’s a third, which is also about the style with which I approach the things I do. And that one often gets forgotten. And the way you work with people in the style is a really differentiating factor in your in your work. So you know, and I’ll give you an example. Are you you know, a through and through expert who goes and tells people the answers to very specific problems. So you rock up, you do a bit of analysis, you tell the answer, and then you go, or are you more of a facilitative style worker who will engage coach, get to understand people help them solve their own problems. And depending on those, you’re going to be working in different ways. And you’re going to appeal to different sorts of clients with different sorts of problems. So I think if you’ve got got to differentiate, you’ve got those three things. And then there’s probably the whole wrapper you put around in terms of how you present yourself. And that gets into you know, your marketing. Are you are you writing books? Are you talking? How do you come across? Do you come across as engaging or not? And it’s those different angles to me seem to be the most important ones.
Alastair McDermott 29:03
What about you talk a little bit about pricing, and selling to people at the right price and setting setting the correct price for your services? Can you talk about how to do that, because I think pricing is something that people find difficult.
Richard Newton 29:17
Yeah, and, and again, pricing is a bit of a black art. And it’s problematic because, unlike, say, cars, you can’t go and look in a autotrader and find out what’s the price of a three year old Audi, q3 or whatever you there is there is no set benchmark. So there’s no there’s no book of pricing and therefore there’s an element of in any conversation with a client “I going to price too high and lose the work or my pricing too low and losing some losing some money?” So so so so to me, the starting point is not working out what’s the maximum you can charge I mean, it’s great if you know that but I think the the starting point for me is To understand what is it what is a reasonable rate you charge that you are willing to work for. And the reason I start there is because then you know, if it’s any lower than that I’m going to walk away. And having a walkaway price is is actually a very powerful thing in negotiations. And if you don’t have one, there is a danger, you end up doing low paid work. So just having that as a baseline that you’re going to do. The second thing is, is that it’s there’s not much information out there. But it’s not that there’s no information out there. So again, actually, I found generally other consultants, other freelancers pretty helpful. And overtime, I’ve built people who I certainly talked to about rates, it’s not always an easy conversation, but you get an idea. So so you can get some, some, some some benchmarks. And then you’re going to pick up from the vibes of your conversations with clients, if clients are biting your hand off to sell to you and there’s never any pushback, well, then you’re probably charging too low. If you’re never selling anything, then you’re probably charging too high. So it’s about there is that process, where there’s no data, the only thing you can do is learn as you go along. But, but you know, certain rules have to be there. So know your walkaway price. And never be afraid to ask for more. You know, what’s the worst of asking for more the clients gonna say? No, it’s, it’s, it’s not a difficult conversation. And always be willing to negotiate, you have to be willing to negotiate with the clients. Yeah. And you know, and there are some fairly, you know, common negotiating tricks that everybody should be aware of, even if you’re not busy actually saying to clients, I’ve got no other work on my books is just a little bit naive, because they’re inherently tend to offer you a lower price. And I think one of the other things is that because freelancers tend to regard the income as if like, it’s a measurement of them, you have to remember that the conversation you’re having with a client is fundamentally a business conversation. It’s not about you.
Alastair McDermott 31:55
It’s not personal.
Richard Newton 31:56
They’ve got a certain amount of money, and it’s not personal, if you take it personally, you’re going to get very upset, sometimes it’s not personal, it’s just they’re going to try and get as much as they can, for whatever money they’ve got. So so there’s, the other thing I’d say about pricing is, is the great thing about walking away is, is that as a freelancer, you don’t need that many clients. And you will soon start to work out clients that you don’t want to work with, and the sorts of clients you do want to work with. And there is a science to it. But I think there’s also a sense. And you’ll know this as well as during conversations, you have a client, you pick up the phone, and somebody is talking to you. And there’s certain phrases or words that they use that you think, yeah, no, this is going to be more hard work than it’s worth for too little money. And if there’s an over focus on money from the first moment they talk to you, that’s always sending a little bit of alarm bells to me as well.
Alastair McDermott 32:49
Yeah, I always tell people trust your gut, and don’t ignore red flags.
Richard Newton 32:54
Alastair McDermott 32:54
I think the only time you ignore red flags, is right at the beginning, when you’re in that kind of scrambling mode and just trying to get cash flow. But, but after that, you have to, you have to, you know, you have to acknowledge them.
Richard Newton 33:09
You do and, you know, it sounds like I’m talking a lot about the negatives about the minimum. But I mean, one of the things to work out is also what’s the cost of running your business. Because and you and I have talked about this before, I think a lot of people see a number that they get as a day rate and think fantastic. I’m making a lot of money. Well, actually, once you’ve taken your costs of running your business, which shouldn’t be high as a freelancer, but they are something once you understand about the taxes you’re going to be paying, it can be a lot less than you think. So do really get your head round the numbers. And if you if you’re not a numbers person, speak to an accountant and get them to show you how it works and what the impact of even small rate changes and day rate can be on your income. Because it’s it’s easy to end up and you know, we’ve all met people in our careers who’ve who’ve thought they’re having a great life, and then the tax bills come at the end of the year, and they realise they haven’t got enough money to pay it. And that’s that’s just such a bad place to be.
Alastair McDermott 34:05
Are there any really great resources that have helped you along the way that you’ve you found to be important for you on your journey?
Richard Newton 34:13
Yeah, I mean, it’s it’s, it obviously, depends what you’re doing. But actually, I’m always amazed how many free resources there are out there. So you know, for example, I’m doing some work at the moment where I need to do some research. And funnily enough, I find that McKinsey have got half a dozen papers on exactly the topic that I need to understand, as have MIT Sloan, so I don’t think there’s it’s like there’s not one set of resources that’s going to work for everyone. But it is definitely keeping if you know your domain about keeping your eyes open on who’s working on the domain. And, you know, I know for example, one of your guests was Jonathan Stark. There’s a guy you can a lot at learn a huge amount about pricing and getting the right room in getting the right revenues in so there are a lot of people out there giving advice and a lot of it’s very accessible. So I think I think, I think, I think it gets to a wider point, which is, when you’re freelancing, you’re not just doing your stuff, you’re running a business. And one of the aspects of running that business is keeping your knowledge and keeping yourself fresh and keeping yourself up to date. So I, there are resources that are particularly pertinent to me and my skill set and what I sell to my clients, they wouldn’t necessarily be relevant to anyone else. But I’m absolutely convinced they’re equally of widely available resources out there. And you do have to be willing to invest the time in keeping yourself abreast of stuff and keeping yourself you know, doing some reading doing some talk. Yeah.
Alastair McDermott 35:42
Someone has to pay for that time. Well, yes, you know, I think which has to go into your pricing.
Richard Newton 35:47
It does. It does. You know, I have I have a good friend who says he spends and he has a very specific calculation, he says he spends I think it is three days revenue per year on books. Yeah, on books related to his topic matter. And because that’s what he thinks it takes to keep him up to speed on, on and it may not be books, it may be papers or other research activities. he’s a he’s an enterprise architect, but it was it’s, it’s interesting that he has a very specific number. And he’s his views. If you’re not keeping up to that level, then you’re going to get out of date. And I think this is increasingly relevant. Anybody who’s sitting there saying I was great at my job 10 years ago, and now I’ve been doing it ever since. But I’ve never refresh my skills, sooner or later works gonna fall off a cliff.
Alastair McDermott 36:30
Speaking about cliffs, I just want to ask you about failures and setbacks. Have you experienced any failures and setbacks? And what have you learned from them? Is there any anything in particular that you can tell us about?
Richard Newton 36:42
I mean, I’ll be honest, and say the things that I’ve I’ve messed up in my career are the things I’ve learned most from So I think, you know, I can think of several I in the, in the sort of context of this talk, I think the letting getting, I do that classic contractor thing, consultant thing, which I think a lot of us do, which is when the revenues coming in, it feels like we’re invincible. And then the day it starts, we feel like, you know, the world’s ended and nobody loves us. I mean, I think that we’re all a little bit like that. I think early on, I had some good contracts, I had some good work, I think I just assumed it would carry on, and I let my sales funnel drop to zero. And it’s that point of always making sure that your sales funnel is keeping refreshed, there’s nobody else is going to be worrying about it for you. So so so you do that. And it’s certainly I had periods early in my freelancing career when the revenues dropped off. And that was a little bit painful. But that’s something you learn from pretty quickly. Yeah.
Alastair McDermott 37:42
Yeah. Yeah, absolutely. A question I like to ask people is, how many hours a week you spend on marketing versus client work. And assuming that admin isn’t, isn’t too big a deal in the equation, because I know, some people spend the majority of the time on client work, and not very long on marketing. But you’re obviously a prolific writer. So you clearly spend a lot of time writing.
Richard Newton 38:10
Yeah, and, and my lifestyle is, is lumpy, by which I mean, it’s not that I’m spending half my time every week on writing and half my time on client work. But I would say in a typical year, I, I’ve, for the last 15 years, I’ve not really done more than eight months, client work in a year, and the other four months have been doing other things. Now, there’s not saying it’s literally eight months and four months, but you can roughly take 1/3, two thirds. And I’ve got a very specific niche. I think if I had a more general niche, ironically, I’d be doing more on the marketing front, because because because I would, I would I would need to do it. So I think that’s a reasonable basis to assume it. I that that kind of works for me. Yeah.
Alastair McDermott 38:59
Yeah, I think I think it’s one of these areas where when people start working for themselves and and have their own business, and they’re getting a day rate with with a client, and so they want to spend all of their time working for that client earning that money. But if you’re not, if you’re not taking the time away from that, to actually build your pipeline, you end up in this scenario we talked about earlier, which is where your pipeline goes empty, right?
Richard Newton 39:27
I yeah, absolutely. I mean, the only the only the only people who kind of sit outside there as if you’re in firmly in the what I would think what I tend to call in the attractor pool. We are not really selling yourself. You’re working on agencies and people like that. It’s a pretty different style of life than than then the real independent consultant freelancer who is running an end to end business.
Alastair McDermott 39:48
Yeah, you’re more like staff augmentation rather than an expert consultants.
Richard Newton 39:52
Absolutely. Absolutely. Yeah. Yeah.
Alastair McDermott 39:55
Well, since we’ve been talking about books today, I want to ask you a couple of questions. Where books Do you have a favourite business book.
Richard Newton 40:01
Oh, I’m going to be honest here. I want to, I’m going to give you more than one. But I am going to be really honest, which is a bit hypocritical because I wrote mostly the business field. I mean, I generally don’t like business books. And I generally don’t like business books. Because if I’m honest, I don’t think I don’t think many of them are that well written. And I think there’s too many people writing books, because I’ve got something to say rather than because I’ve got any because they can write. And I never believe the old line that everybody can write a book. I mean, everybody can whether anybody should is a completely different matter. So but I’ll give you two books, which I think I think are important, certainly, in this domain, to feel I think one book that really had a seminal influence on me was, is the book the trusted advisor, I think it’s a bit of a classic. And I think it takes most of us to think about things we’d never thought of before. So if you think about the lifecycle of stuff for a freelancer, we’ve talked about a couple of people, Alan Weiss fantastic books on how to sell fantastic books on writing proposals and all those those great things, and very, very useful. They are things you know, you need to do. Yeah, I think what I really liked about the trust advisor is until I read that book, I never really thought how clearly there was a thing about deliberately and intentionally building trust with the client.
Alastair McDermott 41:20
That’s from David Maister, Charles Green, and Robert Galfer.
Richard Newton 41:25
Great book, great book really helpful. And I’ll give you one other, which I’ve literally just read. And it’s called The Technology Fallacy. And it’s probably more related to my field, and it’s about digital transformation. But basically, you’re saying, “Yeah, the technology is important, but if all you’re worried about is the technology, then you’re in the wrong space, that it still always comes down to people.” So I think books which which like that, which, which, which, which show that the world is more nuanced than the simple might, you know, the simple soundbite might say, I I’ve always found really, really good and really helpful.
Alastair McDermott 42:03
The other question is, do you have a favourite fiction book?
Richard Newton 42:06
Yeah, I mean, I read a lot of fiction so but that my off Pat answer to my favourite fiction book is a book called The Tin Drum by Gunter Grass. So I, I could list great fiction and literature I’ve read, but that would be up there with them. Always. Yeah.
Alastair McDermott 42:24
And is there a particular genre that you like?
Richard Newton 42:28
Yeah, I, I just like good literature. I’ve got a specific thing about literature from Eastern Europe and from Russia, which I have a real interest in. But that’s just a personal taste. Yeah. Yeah.
Alastair McDermott 42:44
Yeah. Yeah. I guess it’s interesting to see the different cultures. I’ve just started started reading a translation of Arson, Lupin. So because I was watching the TV series. So the French Sherlock Holmes, or that’s what
Richard Newton 42:59
Yeah, yeah. Yeah. I mean, I, because I write, I started years ago, I decided I would write a review for every book I read. Because I thought, if I’m a writer, and I can’t explain why I do or don’t like a book, then what kind of writer I am. So it’s an exercise I’ve pushed myself to do. So if anybody’s if anybody wants to see all the ret, whatever, all the books, I read them, or how I write them. They’re all there on Goodreads under my name. So there’s, there’s, there’s 40 or 50 reviews go up every year. So
Alastair McDermott 43:29
Excellent, I definitely will check that out. Actually, I’m interested in that I’m interested in, in how and why people write reviews as well. And it’s something I’ve thought about myself, because I’ve I’ve self-published one book so far, but I’m in the middle of of writing another. And I know that reviews are really important. So I think that, you know, if I’m if I’m reading, I probably should be reviewing the books I’m reading, if I’m going to go and ask people to review mine later, you know?
Richard Newton 43:55
Yeah, I mean, I think if you ever want to do a favour for an author, they’ll always say, write me a review. For every 10 people who promise do probably one does. And they fundamentally make a difference. They are very, very important. So I do that. For that reason, I actually find reviews intellectually an interesting thing to do to try and sum up what you do and don’t like about a book. So I take a little bit of care over it. So yeah,
Alastair McDermott 44:19
The Freelance Consultant is now available, where can people get that?
Richard Newton 44:24
So you get it on Amazon, and it’ll be in selected book shops, your normal big book shops, your Waterstones. Certainly, if you’re in London, your Waterstones and your foils will have it outside there. Anyone will be able to get hold of it’s a major publisher. So if it’s not in your bookshop, and you want to support your bookshop, get them to order it for you.
Alastair McDermott 44:43
Excellent. Richard, where can people find you online if they want to get in touch with you?
Richard Newton 44:49
Yes, so I exist online in a number of places. I’ve got my company website, www.enixus.co.uk. LinkedIn, I’m reasonably active on and he’s defined. I’m on Twitter as well at RJ n talk, and also probably slightly more secure for most people here. I do I do all my reviews on Goodreads. So if you’re interested in book reviews, you can follow me on Goodreads. And finally I have I stick any videos, I do lectures on YouTube. So all over the place, and
Alastair McDermott 45:24
They’re excellent. And I will link to all of these on the show notes page for this episode. Richard, thank you so much for being with us here today.
Richard Newton 45:31
It’s always a pleasure, Alastair hope to talk to you again soon.
Alastair McDermott 45:37
Fantastic stuff. They’re from Richard a great insight into a successful consultant and author. So here’s three takeaways I took from what Richard said. First is that writing is marketing. And this echoes what Jonathan Stark said back in Episode Two. So go back and have listen to that if you haven’t already. Second thing is about how your style of working with clients can be a major point of differentiation between you and your competitors. And I’m always thinking about differentiation because it’s literally what sets you apart from your competitors. And one of the things that allows you to charge a premium. And then finally, his point about skills ageing very quickly now. And it being important to rethink and continuously revisit your business strategy. I think this fits in with how your positioning statement is something that you should regularly evolve and revisit as well. It’s not something that’s set in stone, it’s something that you should always go back to and tweak at the very least every every three to six months. I think it’s something which I think is really important. And that’s something I’m going to come back to again in a future episode. So thank you for listening. And as Richard said, reviews are really important not just for authors but also for podcast hosts. So if you had 60 seconds to spare to leave a rating and or quick review, I would totally appreciate that. You can do that by following the link in the show notes or if you go to MarketingforConsultants.com/review and that will send you directly to the reviews link. Thanks for listening as always, and see you in the next one.