Most engineers start their careers within a company as this is often the best way to gain a range of experience, skills, and knowledge in what is a diverse field of work. At some point, however, it’s only natural for these naturally innovative and creative people to want to spread their wings. This is why many engineers decide to start their own engineering business. They may begin by working on a freelance consultancy basis, but over time, this can expand until they are the head of their own organization. While it’s by no means an easy choice to make or a guaranteed path to success, there are lots of reasons to consider joining them.
You will be leaving the security of full-time employment and will be facing the pressures of running your own business, but the earning potential, motivation, and sense of pride are invaluable. This article examines the main reasons why you might consider starting your own electrical engineering consultancy as well as the first steps to take in order to make it happen.
Should You Start Your Own Consultancy?
A big motivation for many engineers looking to start their own business is the attractive prospect of being your own boss. You are in charge of the kind of work you do, when you work and, to an extent, the people you work with. Of course, the other side to this flexibility is the pressure of knowing that the venture’s success is down to you.
When you own your own business, your earning potential is (in theory) limitless. Business owners make more money than managers and employees, but this will take time. The early years of your business are likely to be the hardest, and you may not make a profit for a while. It’s also important to understand the very real financial risks you will be taking, including the possibility of bankruptcy.
If you can make the business a success, as many engineers do, you could establish an organization which will be around even after you retire. You could make a real impact on the industry and leave a legacy for the next generation of engineers to continue.
Are You Ready?
You may be ready for a new challenge in your career, but there are some essential factors to consider before you take the leap.
While you may have been working in the electrical engineering industry for some time, if you’ve not progressed to a senior role, you may be lacking the level of expertise needed to lead on projects for clients. You may want to consider some further study to deepen your knowledge and equip you with essential skills. You can study for a masters in electrical engineering online,so you don’t need to stop work to be able to take the course.
However, you can have all the engineering experience and education in the world, but this will not necessarily mean that you’ll be able to run a business. Your engineering qualifications and experience will be essential for the quality of your work and winning your clients’ trust, but that’s not the whole picture. Have you got a detailed business plan? You also need to work out how you are going to find your clients, how much you need to charge to make a profit, how to manage business accounts, etc.
Managing business finances is essential in business. You may need to invest some money to get premises and necessary equipment, and there will be ongoing costs such as utilities, taxes, and marketing costs. Some entrepreneurs apply for a business loan to help them get their business off the ground.
How to Make Your Consultancy a Success
Once your business is up and running, you’ll be faced with several new responsibilities which you’ll need to manage, including people management, financial management, marketing, and more. You may want to take a business management course to equip you with the necessary skills. If you don’t, you’ll be learning as you go.
You may not take on employees, but even if you don’t, your people skills – also referred to as ‘soft skills’ – will be crucial in making your business a success. Working with partners, suppliers, and clients require excellent communication skills, conflict resolution, and the ability to build and maintain relationships.
Many start-ups are one-person operations in order to save money and maintain control of the business’ direction in the early days. However, as your business grows, you may find that you can no longer run all elements of the operation by yourself. If you do decide take on employees, you need to learn how to delegate. No one can do everything and, if you try, you’re likely to see a decline in standards somewhere. Accept your own strengths and weaknesses and find reliable people who can take on areas where you are struggling and/or are time-consuming. When you have your team in place, you need to ensure they are well-trained, competent, motivated, and productive.
Marketing, Sales,and Networking
Finding new customers is a challenge for even established businesses, and it can be particularly tricky in the early days when you’re still building your reputation. When a company employs you, you have a team of people around you who are interested in your projects and ideas, but when you start your business, you need to seek these people out actively. Word of mouth can be very powerful, so it’s essential that you’re attending networking events and trade shows to build up your profile in the industry. Invest in some business cards and flyers to leave with people you speak with, and they may think of you when they need an engineering consultant.
Quoting for Projects
Deciding how much to quote in the early days can be a minefield as you want to make money, but charging too much could deter clients from working with you. This can be even more complex in engineering projects as the costs and timelines involved in a project can evolve over time. Many engineers use a ‘cost-plus’ quoting system; this means you quote for what you expect to charge but gives you some leeway should unexpected costs crop up. You can then discuss these costs with the client on an as-and-when basis.