US consultants see rookie fee-rates rocket

Fees for entry-level consultants in the US have rocketed in the last five years, according to a survey by the US Institute of Management Consultants. But the most experienced consultants have scarcely raised their charges at all. The report compares responses to questionnaires launched by the IMC newsletter, Management Consulting Times, in 1994 and 1997. Respondents reported fees ranging from $50 to $350 an hour, with a median of $150 per hour. Utilisation varied, with 25 per cent billing 700 hours or less per year and 25 per cent billing 1,200 hours or more.

Project fees were the most popular billing method used by 7 per cent of respondents, with time-based fees (against estimate) the next most popular at 66 per cent. Retainer fees were used by 30 per cent. Only 11 per cent billed unit fees against activities.

James Carey, of Carey Associates, which carried out the 1997 survey, offers the following tips on maximising fee income:

– Stress value and, where appropriate, urgency of the task;

– Show complexity of task (but don’t get bogged down in details);

– Show your expertise (briefly, confidently);

– Differentiate yourself (IMC membership and the CMC help);

– Get larger clients and projects (gain economies of scale);

– Use project and unit fees (avoid selling time).

The 1997 survey attracted replies from 128 consultants at 71 firms, while in 1994 238 consultants from 100 firms replied. More details can be found at the IMC web site ( along with other information on the Institute and its programs.

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