The state of the IT consulting industry

[David Randolph]

One issue that has not been mentioned here is the General Computer Consulting vs. Niche Market.

Everything mentioned so far fits the general computer consulting market: dominated by delivering bodies to the client and sold through personal relationships, not quality.

Things are different in a niche market. In that market, the expertise is valued because it means that the consultant can deliver quality at a lower price. It also helps to be able to do fixed price work (and build up a library of solutions so that the costs are even lower).
One way to do this is to build a Saas and then sell custom versions of that to people who want to run the service. I talked to one company that did that and they made 3 times the money through the custom work than through the service.

[Richardk]

I think that's a different discussion since you are delivering something apparently tangible, be it a product or service. It's also where most of us probably want to end up but once again, you need the time and focus to put this together and hope that your niche isn't dominated by a huge player or evaporate before you can cash out.

Pure consulting as a niche is a tough business because exactly what are you selling? As GB mentioned, it's bodies or pain relief.

And as a generalist in that niche, it's even harder because 99% of your clients don't understand what you do. So the social aspects are huge.

As many of us learned (too late), pure technology alone doesn't sell.