How do consulting firms build their prices? What is the cost breakdown of a consulting firm? Understanding the different fee structures and when to use them is key to create more value when buying consulting services.

On this week’s Smart consulting Sourcing podcast, I talk about consulting fees and rates.

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The time spent on a project is the major driver of cost for consultants since they are mostly selling their time. The price is usually calculated as the product of the daily rate per the number of days worked on the job. In most cases, the price for Consulting Projects is driven by a client's industry. At the high-end of the spectrum, Financial Services or Energy, Consultants charge a premium, whereas at the low-end are the Non-Profit Organizations.

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