From Allan Tsang, 88owls.com:

How does a business know it can afford a consultant in a recession?

A colleague and friend asked me this a couple of days ago. All I was thinking was…wow…  Where do I start?

Anyone who has read the book Who Moved My Cheese?: An Amazing Way to Deal with Change in Your Work and in Your Life knows that in a recession, it is time to “sniff” out new “cheese” and to scurry. The old way of doing things may not work in the immediate-to-near future anymore.  Things change so fast even for a “young kid on the block."

But I would say this.  The same reasons a good consultant may help you in times of plenty are the same reasons they can help you in these lean times.

You can look at consultants as an expense, like a vacation or a movie, or you could look at them as an investment.  How much is a good idea worth?  How do you reward that in an equitable way?  Any time you can expect a financial return on a decision, it is an investment.  So essentially you are investing in the consultant.

Reasons to hire consultants in tough times:

1. Unlike an employee, they hit the ground running.
2. No need to teach them their jobs – they usually can teach you something new.
3. No need for benefits – sick days, holidays, workers’ comp., personal days, vacations.
4. Different way of thinking – sniff out new cheese.
5. Broader experience – if they have more than 10 years.
6. Unbiased perspective because they are not mired in the politics of your company.
7. Work still needs to be done – they are easier to let go of once the job is completed.
8. Consultants are connected to other businesses and may be able to help network and draw more business to yours – whether they are vendors, customers, or partners in joint ventures.
9. Consultants worth their salt would want to see your financials. They can implement effective cost and profit controls and analyze and develop an effective and profitable margin mix, as well as work within a budget.
10. One of my favorite calculations (not necessarily applicable to start-up ventures) on whether a consultant is worth it or not is this:  In 12 months, can he/she help bring in a 3:1 return? If that can be identified, I would be a fool not to start scurrying...

...anyways, that’s it for now, I’m off to sniff out some cheese of my own.

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Allan Tsang is the founder of 88owls.com, a community of business consultants with more than 10 years of industry experience. A client of Handshake 2.0, 88owls.com matches business consultants with businesses seeking consulting services.  You can follow 88owls on Twitter @88owls.