Consulting Fees: How Much to Charge (Hourly and Project)

Wondering how much to charge for consulting services? 

You’re in the right place. 

I know just how easy it can be to overcharge or undercharge as a consultant. 

But today, I’ll help you figure out your pricing step by step, so that you can build a profitable, fulfilling consulting business. 

Interested? 

Then let’s dive in!

Key takeaways: 

• The average hourly rate for consulting is $30. However, many established self-employed consultants charge over $100 per hour. To calculate your hourly rate, figure out how much you want to earn per month, and then divide this by the number of hours you work.
• Project-based pricing is the best solution for most consultants. Account for the scope of the project and the number of hours worked to get an accurate package price.
• The best place to start as a new consultant is $1,500 for a three-month package. You can then gradually increase your rates as you work with more clients. 

How do you determine your consulting fee?

So, how exactly do you figure out your consulting fee? 

With the average consultant in the US making over $90,000 a year, it’s tempting to just go with the average. 

I get it. 

When I started my digital advertising consulting business, I struggled with pricing too. But I soon figured out that pricing on value was a much better strategy. 

That led me to build a six-figure business that freed me from my 9-5. 

Looking to achieve that too?

Here’s how:  

Look at the value you offer

First off: What results do you offer your clients? 

This can be difficult to figure out — especially if you’re a new consultant.

Think of it this way: To charge your worth, you need to focus on the benefits, not just the features of your consulting package.

For example, let’s take a look at one of my students, Mara Freilich. In her business, Top Law School Consulting, she helps students get into top law schools. 

Mara offers her clients one-on-one calls, edits their admission materials, and provides interview support. All good stuff… But those are features.

The benefit of working with Mara is simple: She improves clients’ chances of getting into an excellent law school,  ensuring better employment prospects in the future.

That’s where the real value is. And that’s what she charges for.

See the difference? Now it’s your turn.

Consider: 

• Your background and expertise: If you have personal experience or education in your field, your advice is more valuable.
• Previous results working with clients: Testimonials provide social proof to new clients that you know your stuff.
• The difference between you and your competition: A unique offer can be worth much more than what your competitors charge.

If you’re still stuck, consider the cost of NOT working with you, and that should make your value clearer.

Research the average market rate 

It’s tempting to look at other consulting businesses and set similar (or slightly lower) prices to them. 

Websites like Indeed and Glassdoor can give you pretty good averages for a wide range of consultant salaries. 

But not so fast. ⛔️

To ensure you don’t undercharge, your market research needs to be way more strategic than that.

It’s not enough to look at averages. You need to research your audience and figure out how much they’re willing to pay for your consulting services. 

For example, my friend Cassandra Sethi is a successful style consultant for executives and entrepreneurs. 

Her packages will be very different from Peter Nguyen’s, from The Essential Man, who specializes in styling modern men.

Why? Because their audiences are completely different.

Now, you might be thinking: 

“What if I can’t find any consulting businesses in my niche?” 

If your consulting niche is fairly popular (like HR consulting), but you can’t find many businesses for your specific audience, you need to validate whether that audience actually wants your services. 

Generally, I don’t recommend that my students start a consulting business with no existing competition. 

At the same time, a unique audience that wants your services will probably pay a little more for them.

The bottom line: Researching your competition is just a starting point. You don’t need to copy your rates from other businesses, but getting to know the range will prevent you from overcharging or undercharging.

Factor in your workload 

This is where your hourly rate comes in. 

I’m not a fan of charging hourly because it doesn’t account for the value of your work. (More on that later.) 

But, that doesn’t mean you should completely ignore the time you’ve spent working. 

Ask yourself: How much time is required to help my client achieve their end result? 

That includes any time spent: 

• Communicating with clients
• Researching data
• Creating presentations

Next, let’s talk about something many new consultants forget.

Consider your cash flow 

I’ve built a successful eight-figure online business. However, it has cost me a LOT to build it.

I talk more about that in this video:

Not enough people consider their expenses when building a consulting business from scratch.

But here’s the thing:

Choosing the right pricing strategy ensures that you have a positive cash flow.

Research shows that the average profit margin for business and consumer services is 31.80%. 

My advice? Aim for 50%. 

This is totally doable if you know your expenses inside and out. 

But it will involve getting really detailed with your expense tracking, including:

• Online subscriptions
• Internet 
• Equipment
• Transportation 
• Marketing costs
• Outsourcing fees

💡 Top tip: Don’t forget taxes! You want to set aside at least 30% of your revenue for taxes, so factor this into your rates.

Focus on your goal

With so many things to consider, it’s easy to lose focus on what you want to achieve.

It’s likely you’re starting a consulting business to achieve your financial goals. 

Maybe you want a life of freedom and fulfillment. Or perhaps you want to quit your corporate job like I did.

Only you can answer these questions:

What’s your goal? And how much do you need to achieve it? 

Let’s say you want to leave your 9-5. 

In that case, I recommend building up your business to reliably double your monthly salary. 

Once you have that number in mind, work backward. 

Ask yourself:

• How many clients can you work with each month? 
• How much would you need to charge each client to hit your monthly goal?

Now that you have a rough idea of how much to charge for consulting, let’s talk about pricing strategies. 

How do you set your consulting fees? 

In this section, I’ll cover the best pricing models for your consulting services. 

I also discuss them in this video:

Ready to go? Let’s jump in.

 1. Hourly 

Hourly pricing is when you charge your clients for the time you spend on their projects. 

Average hourly rates vary widely across industries, with an HR consultant bringing in $36.38 and a marketing consultant making $18.73.

To figure out your hourly rate, use your 9-5 salary.

For example: Let’s say your corporate salary is $78,000 per year. 

To get your weekly rate, divide the total by 52 = $1,500 per week. 

Now, divide $1,500 by 40 hours to get the hourly rate of $37.50. 

If you’re a new consultant, this is a good place to start. In fact, this is the calculation I used to create my first six-month consulting package at $5,000. 

But I don’t recommend staying at this rate for long. 

Once you have a few clients, double your hourly salary to cover taxes and other expenses.

Also, never sell your services on an hourly basis, even if you use hourly rates to figure out your package pricing. And as your business grows, you don’t need to consider your hourly rate at all – just the value of your offer.

Read on to learn more about them.

2. Daily  

Like hourly rates, charging daily is about trading time for money. 

It’s a common pricing model for strategy, management, and IT consultants. 

To calculate your day rate, you have two options: 

1. Figure out your hourly rate and multiply it by 8. (Follow the process in the previous section to get your hourly rate.)
2. Start with your corporate salary and divide it down to get your day rate.

Example: If you earn $65,000, divide this by 52 to get your weekly rate of $1,250. 

Then, divide $1,250 by 5 = $250 per day.

Is daily pricing right for you? I don’t recommend it any more than hourly pricing. 

Pricing on value is much more sustainable for building a successful business. 

And project-based is much better for communicating your value, so let’s talk about it.

3. Project based   

I recommend my students price their consulting services either per project or per package, and here’s why:

Project-based pricing is the best way to charge for the value of your results. 

Instead of trading time for money, you set a price that works for your client based on the transformation they can expect from working with you. 

You can also market your fixed-rate package like a product, which is much easier to sell.

So how do you calculate the price of a project? 

First, start with the time involved. (You can use the hourly pricing calculation to work out this first step.)

Next, think about the scope of the work. For example, if you’re a strategy consultant helping a business improve profitability, what tasks do you need to do to help them achieve their goals?

Then, consider your expenses, including travel, platform subscriptions, and so on.

Finally, it’s time to ask the golden question: What is the value of your results? 

If there’s a tangible gain for the client after working with you, factor that into your fee.

Still struggling to figure out your fixed rate? Here’s what I suggest:

Offer a three-month package at $1,500, including monthly calls and an extra line of communication. 

If that feels too low, you can always raise your prices after working with a few clients. 

4. Retainer  

Does your client want ongoing services from you?

If so, a retainer rate could be the solution. 

This is when you set an advance monthly rate for your services.

It’s a popular pricing model for law consultants, who use retainers regularly. 

Retainers are usually better than hourly or daily rates because you can charge your worth. 

However, you can end up working more or less than what was originally expected, leaving you or your client dissatisfied.

To prevent this:

Define what your retainer includes before your contract – this will avoid overworking. 

To calculate your retainer rate, you can start with your hourly fee. 

For example, if your hourly fee is $100, multiply that by 10 (or however many hours you include in your retainer) to get your weekly rate = $1,000. 

Then, multiply that by 4 for your monthly rate = $4,000.

Typically, retainer rates are slightly discounted from the full hourly rate to make the package more attractive to your client.

5. Commission based 

Marketing and strategy consultants, this one is for you. 

Commission-based pricing is when you earn a commission from the revenue you help a business create. 

Despite being unstable, this can be a highly lucrative pricing model. 

However, you need to have excellent systems in place to track your progress.

So, if you can’t track the return on investment you achieve for your client, don’t do it! 

Use project-based pricing instead to fully compensate for your work.

Next up: How to sell your packages authentically.

5 important tips for communicating your consulting fee 

Now you’ve figured out your pricing, what happens if clients think you’re too pricey? 

I hear you. It happened to me multiple times when pitching my services to clients. 

You can hear more about my experiences here: 

To effectively communicate your rates to clients and make sales, I recommend following these tips.

1. Avoid underpricing 

In my experience, most people undercharge more than they overcharge. 

You might think that charging a lower rate will make it easier to get clients. 

In some cases that’s true. 

But you could be doing yourself a disservice. 

If you charge a higher price, you:

• Attract dream clients: Your price is a reflection of your work. Studies show that consumers perceive high-priced services as high quality.
• Increase your profitability: A more profitable business means more flexibility and freedom for you.
• Reinvest in your business: Having a higher profit margin gives you more funds for marketing and advertising, leading to faster business growth.
• Streamline your time: By charging a higher price per client, you don’t have to work with as many clients to achieve your financial goals. That means more focused attention and better results for each client.

And remember this:

Your pricing is not a strategy, it’s a reflection of the transformation you offer.

This tip applies to new and established consultants. As you work with more clients, the next four tips will help, so keep reading!

2. Highlight results   

To communicate your pricing to clients, you need to focus on value. 

Remember the features vs benefits comparison? This is where the benefits of your services really shine. 

There are multiple ways to highlight your results. 

One of the most powerful methods is to share success stories. 

An experiment by WikiJobs showed that conversions increased by 34% when testimonials were added to a sales page. 

This is because social proof increases trust in your brand.

📧 You can ask your clients for testimonials with a simple email like this: 

“Hey (name),

I’m so pleased that (the result you helped them get)! 

Would you be open to giving me a quick testimonial about your results that I can share? Let me know and I’ll send over a list of questions. I’d be happy to put them together into a short blurb that I send to you.

Thanks,

(Your name)”

Another way to highlight results is to help your client imagine the journey from where they are now to where they want to be. 

The more directly you speak to your client’s goals, the more deeply your message will resonate.

3. Understand the scope 

Have you ever given a quote and later realized you priced too low? 

The mistake is simple: Not fully understanding the scope of the work involved.

To some extent, this comes with practice. 

Because when you’re new to consulting, it’s hard to estimate how much work is involved in each project. 

Here are some tips for finding out exactly what you’re getting into:

• Ask as many questions as possible during your sales call
• Outline all of the tasks included in the package in your contract
• Create one-off rates for extra services 

Another way to avoid lowballing your work is to productize your services. 

Imagine this: You have repeatable consulting packages at fixed rates that your clients can pick and choose like a product. 

The result? Reliable income and clear parameters on your work for a profitable price.

Many of my students have used this strategy to create six-figure businesses, and you can too. 

👋High five to that👋

4. Work with the right clients

The biggest factor in whether your prices are accepted or not is your audience. 

Essentially, if your target client can’t afford your services, you’ll struggle to make sales. 

For example: Thrive HR Consulting is a consulting firm working with Fortune 500 companies. 

Their target clients’ budgets will be much higher than an HR consultant for small businesses. 

Therefore, you should choose an audience that will fit with your business goals. 

But there’s another side to this. 

Once you’ve chosen the right clientele, you need to build trust with them. 

See, selling isn’t about tricking people into working with you or any other salesy tactics. 

Instead, you want to communicate that you’re on your client’s side. You’re working together to help them achieve their goals.

To build trust with your clients, consider: 

• Creating high-value content that shows your expertise
• Sharing your testimonials and references
• Addressing your client’s concerns in real time
• Show the process of working with you

All these factors will help your client envision the results you can create for them.

Now, on to our final tip: Adjusting your pricing.

5. Adjust your pricing 

It’s easy to get hung up on pricing. 

I remember starting my first consulting business, worried about outpricing my target audience and struggling to get my business off the ground. 

In the end, once I’d figured out my market, it took just four months to reach six figures.

To achieve that, I changed my pricing multiple times. 

The key takeaway here? You can always change your prices. 

In fact, think of your pricing as an experiment. 

Set a price for the first three months. (As mentioned earlier, I recommend my students offer a three-month package for $1,500.) 

Then, market yourself at that rate and see what happens. If your target audience doesn’t respond, change it! 

Your prices are never set in stone. Keep adjusting until you find the sweet spot.

As your business reputation grows, your pricing strategy will matter less and less. 

Next steps 

So there you have it, that’s how much to charge for consulting. 

But your pricing is just one aspect of becoming a successful consultant. 

Over the years, I’ve helped thousands of people like you build their dream consulting or coaching businesses from the comfort of their homes. 

To help you get started as fast as possible, I put together a roadmap that shows the exact steps you need to take. 

If you’re ready to build a six-figure business that frees you from your 9-5, download my free blueprint below. 

Read more:

How to Become a Successful Consultant

Types of Consulting (+How to Choose Your Niche)

The Most Important Consulting Skills You Need to Have

Consulting vs Coaching (The Biggest Differences)