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close this bookHow to Select and Use Consultants - A Client's Guide (ILO, 1993, 220 p.)
close this folderChapter 5. On consulting fees
View the document(introduction...)
View the document5.1. How consultants calculate fees
View the document5.2. Information on fee levels
View the document5.3. Fee-setting practices
View the document5.4. Billing and payment schedules
View the document5.5. Guarantees, bonds and retentions

(introduction...)

In this chapter, you will learn about the costing, fee-setting and billing practices that prevail in today's consulting. You appreciate that consultants are in business as you are, and must be properly remunerated for their services. But what is "proper" remuneration? You might have heard that, within the same country and sector, the difference between the fees charged by the cheapest and the most expensive consultants may be 1:10, and even more. How can one explain this difference? You may have doubts about the fairness of the fees charged by your consultant. How does he arrive at his particular figure?

There should be no misunderstanding between the client and the consultant, and no feeling of uncertainty on the client's side, as regards consultant fee levels and practices. You must be convinced that the fee is fair and that you will be getting value for your money. You should not use a consultant whom you regard as too expensive. Such a suspicion would spoil your relationship and could make your collaboration with the consultant very difficult. If your experience with using consultants is limited, you should feel free to ask your consultant for a detailed explanation of the fee proposed. A real professional has nothing to hide and will not be offended by your questions. On the contrary, it will give him an opportunity to explain his business concerns and justify the value of the services that you will be getting. Your relationship will become more transparent and more sincere.