How Much to Charge for Consultancy?

Here in the US engineering consulting fees vary a lot. In some fields a senior engineer with a proven background (patents, papers at conferences) can get $200 per hour. In other fields, a consulting engineer with less experience might get only $50 per hour. With the depressed economy rates may have dropped a bit.

Have you tried an internet search for salaries? There is a lot of info on-line that might help you.

If it were me, though, I'd use the internet info and the above info just as background and I'd begin by asking the employer what they had in mind. I'd negotiate from there. You might want to talk to a lawyer, too, to see what the legal issues might be.

In architecture and engineering, fees are sometimes base on a percentage of what the cost of construction turns out to be. Something like 10-15% might be a normal range.

For grain elevators, preparing the tecnical specs for the construction, I usually charge between 1% and 3% of the estimated global cost, but this is my first project in the meat business and it is far more complex than what I usually do.

Yes, I tried Google and Bing before posting the question here, but couldn't find anything. An option would be to charge what an in-company engineer would charge him for the same job.

Company hourly rates are broken down for billable time as:

Direct Cost - Paid to the employee

Indirect Cost - Overhead for the enterprise

Fees and Profit - 5- 10 percent.

But when you are a Sole-Sorce Proprietor (i.e. working out of a suitcase) the Indirect costs are very low relative to a big company. Indirect costs cover all overhead.

The advantage that you may have is that you can undercut the large company in the Indirect Cost portion.

So you could charge quite a bit more for Direct cost to make it a good deal for the client (if he were forced to hire a big company).

These costs are broken down by auditors.

Notice we are talking about billable time. When a salaried employee works for a company and does not have a billable account, the cost for his salary comes out of the overhead. Companies don't like that.

Have you got any sample quotation?

One or two months is a pretty big window.

Figure out how much is the minimum you would take for two months, full time.........or the lowest average in your field for that amount of work. Add 25% to that, and that will give you a close approximation.

It boils down to more than what the job is worth, it's, what it's worth to you and what it's worth to them..................charge too much, and you make nothing.

Above all, be honest. Explain that you want fair compensation for your work. Develope a relationship with these people. Once that is done, you can give them a minimum and maximum number in which the job is done properly. Ultimately, you will have been fairly compensated for your work, and the client will be happy with a job well done.

Don't forget to take into account, that this client may well be working on your sales team, for free, for years to come. Good luck!