Marketing Consultant Interview Question:

Explain me how should consultants set prices for projects?

Submitted by: Muhammad

Since companies hire consultants from outside the organization, pricing always enters the discussion. Consultants, especially self-employed ones, should understand how much to charge and be skilled at negotiating rates. Look for an answer that shows the applicant understands a consultant's work is all about the value being brought to the company. What to look for in an answer:

☛ Applicant's understanding of the consultancy industry and what drives pricing
☛ Ability to calculate and track work expenses and profitably price a project
☛ Negotiation and communication skills

Like anything, the market sets the price in consultancy. I believe rates shouldn't be calculated according to hours worked. Instead, consultants should sell value. For instance, a consultant could price a project based on how much-added revenue it will bring the company. Consultants also have a responsibility to clearly communicate their rates to the client, being sure to take into account the client's budget. Negotiation should be carried out openly and honestly. There is some room for compromise on rates, but consultants must be careful to not go too low just to get the job.
Submitted by: Muhammad