Crain’s Detroit Business: Do research before hiring a consultant

SMALL BUSINESS MONTHLY
Do research before hiring a consultant

By Nancy Kaffer

Veronica Lujic and Nicole Rafaill’s State of the Art, a custom framing shop and gallery in Ferndale, had been open about a year when the pair decided it was time to get help.

Both are artists, Lujic said, but needed business operations expertise. So they hired a consultant.

“A lot of businesses fail in the first two years, and we didn’t want to be one of those businesses,” she said.

That was three years ago, and Lujic and Rafaill are still in business.

While there’s a host of free advice available for business owners and would-be owners, free resources may not meet all a business owner’s needs. So when is it time to hire a business coach or consultant? And how do you find the right person?

“My very strong opinion is go free first — there’s a lot of great free information out there, and with the Internet, the world is our oyster,” said Gino Wickman, a business coach, creator of the Entrepreneurial Operating System and author of the book Traction: Get a Grip On Your Business, a business strategy guide. “When it’s a good time to use a consultant is when you don’t have the answer and can’t find the answer.”

Finding the right consultant, said Ed King, director of small-business services in Wayne State University’s department of executive and professional development, is a matter of research, research, research.

Check with trade associations and on industry-specific Web sites to see who’s respected in the field, King said. Look for an adviser who’s served comparable businesses, and has delivered results.

Wickman advises business owners to be demanding when seeking a coach or consultant.

“Ask for their entire client list, not their best three, which is what they’ll want to give you,” he said. “And make sure they offer a guarantee — if I don’t deliver the value I promised, you don’t have to pay me.”

Don’t take a consultant’s claims of expertise at face value, King said.

“If you start talking to them and they don’t understand the buzzwords of the industry, that’s a bad sign,” he said.

Setting clear goals is important, Wickman said, for the consultant and the business owner.

Lujic and Rafaill met with a few consultants before they met someone who clicked.

The consultant led them though a retail planning process. They helped the owners identify business strengths and weaknesses, areas that were working and those that required improvement.

“A lot of that is numbers,” Lujic said. “You assess when people are coming in, what kind of people are coming in, all the statistics people usually talk about but you never really know “til you sit down and see it.”

Nancy Kaffer: (313) 446-0412, [email protected].