Many young professionals wonder about what it is like to work as a freelance consultant compared with working in a consulting firm. Both are great career paths which offer a wide range of opportunities, however they often suit different types of candidates.
There is a certain allure and prestige around working as either, with the firm being seen as a stable long term career path while freelancing being seen as a path to career freedom. In this article we will cover the potential benefits and drawbacks of working in both.
Consulting Firm
Benefits
In a consulting firm, the firm provides both a team along with support in finding clients and project opportunities. There is typically clear criteria to move up the ranks and many practice development activities. The role often provides more financial stability and better non-salary benefits such as travel, pension, and healthcare supplements.
Consulting firms often provide strong networking opportunities, with meetings and events with other companies being frequent. With other team members and networking comes mentorship, where other team members will coach you and further develop your skills.
Another major benefit of working at a firm is the knowledge repository. Firms typically maintain case studies and other materials from past projects and business development initiatives. These resources give you a strong leg up when building proposals or starting new projects.
Drawbacks
There are however certain downsides often with working at a consulting firm. There will be projects which don’t interest you and you cannot as easily choose not to do them. Furthermore, you may lose out on faster salary growth as consulting firms have a profit margin over your market rates.
As with any organization, corporate politics and culture can come into play, many times not to your benefit. Having a good relationship with the right stakeholders at the firm is key to moving up the ranks. Sometimes hard work can go unnoticed if you are unable to communicate your successes with upper management.
Freelance Consultant
Benefits
Freelance consulting of course has many benefits. If you are skilled in a certain area or domain, you can command higher pay at market rates compared to working at a firm. You also have more control over the projects you choose to take on and have more freedom in completing them the way you like to work. You are less restricted in choosing your work location, tech tools, and the domains you specialize in.
There are also unique benefits related to being a freelancer in many countries. These can include tax advantages and even relocating to lower tax locations. These are not easily available to employees of a consulting firm.
Drawbacks
As a freelance consultant, you are responsible for every aspect of your practice, from finding clients and projects, to advocating for higher rates as you build experience. Freelancing can be both more difficult than working in a firm while also being more rewarding financially. Freelance consulting requires stronger business development skills than working at a consulting firm, as you often times need to develop your own brand value which can be challenging.
Conclusion
In the end, both career paths can be incredibly rewarding, and depend on your goals. If you are someone who enjoys the company of other team members at a firm, naturally working at a consulting firm would be the best fit. However, if you are someone who is more suited to being solo, the freelancing can be a great path. Many consultants have switched between the two, with firm consultants often leaving to go freelance. Ultimately it is a matter of personal choice.
About PrepareConsult:
PrepareConsult is a platform to practice the consulting case interview with AI and peers. PrepareConsult is founded by Milad Mohammadi and Sahhas Nathella.
Milad Mohammadi – 7+ years of experience in consulting and professional services with experience across North America and Europe.
Sahhas Nathella – 5+ years of experience in consulting and professional services with strong experience in complex digital transformations.
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