Passive income for consultants…is it really possible?
Yes. It absolutely is.
We’ve done it ourselves and we’ve taught our Clarity Coaching clients to create passive income.
However, creating “true” passive income — income that requires no ongoing work — takes a lot of work upfront.
In this article, I’ll share…
- What passive income looks like in the context of entrepreneurial consulting
- 7 examples of passive income strategies for consultants
- And how to get help setting up a profitable passive income source for your consulting business.
Remember: as an entrepreneurial consultant, you’re not just a consultant.
You’re an entrepreneur.
And that means you have the freedom to be creative about how you generate your revenue.
You can offer more than traditional consulting services.
It’s your business, you can do what you want!
Ready to figure this out? Let’s dive in…
“If you don’t find a way to make money while you sleep, you will work until you die.”
– Warren Buffett
What Is “Passive Income?” (Consulting Business Context)
Passive income — in the context of a consulting business — refers to revenue that you generate while you’re not working.
For example, delivering your typical consulting project is not passive. You’re getting paid for the work you’re providing.
Now think of a product like our consulting book called Consulting Success. We’ve sold thousands and thousands of copies of this.
I took a few months to write the book, and then, after some promotion and distribution, the work was done.
When people buy your book, you generate revenue.
Selling a book enables you to generate revenue while you’re not working. You can make book sales while you sleep.
This is just one simple example.
Passive income for consultants is about creating productized versions of your expertise that enables you to earn revenue 24/7.
It’s also useful to think about not just passive income, but passive lead flow.
For example, you might get new leads whenever you go to a conference.
And you might also get leads by publishing content on your website.
The former method requires you to continually do the work to get leads.
The latter requires you to do the work once — and continually benefit from that work.
That’s not to say you should never engage in “active” lead flow nor should you stop going to conferences.
Attending conferences where you’re actively going out and having conversations with ideal clients can be a great way to build your pipeline and business.
However, it’s critical that you also take a long-term approach to your marketing.
This means engaging in activities with no immediate payoff (like authority building & SEO) but will reward you with passive lead flow with the right strategy and consistency.
Passive income for consultants is about creating productized versions of your expertise that enable you to earn revenue 24/7.
7 Proven Passive Income Methods For Consultants
Below are some of the passive income strategies that have worked for us and some of our more advanced Clarity Coaching clients.
1. Consulting Retainers
What it is: Consulting retainers are a fee paid in advance to retain your services on a monthly or annual basis, allowing clients access to your expertise when they need it. Retainers create a predictable and consistent revenue stream and are less “hands-on” compared to a typical consulting project.
Example: An IT consultant might offer a fractional “Chief Technology Officer” service where, for a fee, their clients have access to the consultant’s expertise whenever they need it — without active, day-to-day management.
In Our Experience: The Consulting Success® book generates 5-figures per year for the company. It’s sold through Amazon and is completely passive revenue. And it’s one of the top lead generators for our Clarity Coaching Program.
2. Books & Audiobooks
What it is: By writing books or creating audiobooks, you can package your expertise and sell it to a broad audience. This method involves a lot of effort upfront. But it can lead to ongoing sales and royalties without additional work. It also serves as a powerful marketing tool for your consulting offers.
Example: Erin Mies & Kristen Ireland of People Spark Consulting, an HR consulting firm, are publishing a book to share what they know. They’ll be able to sell their book independently or on Amazon or Audible, reaching a global market and generating passive income.
3. Affiliate Marketing
What it is: Affiliate marketing involves partnering with companies to promote a product or service to your network. When someone makes a purchase through your referral, you earn a commission. Since consultants often recommend tools or resources, this can be a natural extension of your advice.
Example: A management consultant might partner with a software company, recommending their business planning tool to clients. They receive a percentage of any sales generated from their referrals.
4. Courses
What it is: Online courses allow you to teach and share your expertise with clients around the world. Once you’ve created your course and uploaded it on an educational platform, clients can purchase access at any time, generating income beyond your initial time invested in creating the course.
Example: A financial consultant develops a comprehensive course on budget management for small businesses and then sells it on platforms like Udemy or Teachable. Their clients are able to take the course — or invest more to work directly with the consultant.
In Our Experience: Our latest launch of Momentum generated over $6-figures in revenue. The campaign itself was a lot of upfront work, so the marketing side was not passive. However, once sold, there was essentially no “delivery” work. Courses (like anything) take work to market, but the marketing is the work because you don’t have a “project” to deliver.
5. Productized Consulting Offers
What it is: Productized consulting offers are when you package your services into standardized products with fixed prices. These can be workshops, toolkits, or consulting sessions that require minimal customization, allowing for scalability without significantly increasing workload.
Example: A leadership consultant might offer a one-day intensive workshop on leadership development for middle managers that clients can book on demand. They offer it as a live workshop, record it, and then sell the recording later to clients who are interested.
In Our Experience: We frequently host live workshops for entrepreneurial consultants. Recently, we packaged up a few of the workshop recordings and sold them as a bundle. With a few short emails, we generated over $10K in revenue. There are many ways to package, productize, and bundle your various offerings.
6. Licensing/Certifications (“Train The Trainer Model”)
What it is: Here, you create a structured program other professionals can be certified to deliver. They pay for the certification and then can provide your proven methodology to their clients.
Example: A PR consultant might develop a conflict resolution program that other PR consultants train for and then deliver under license. With this model, you support your trainees with materials, training, and updates for an annual licensing fee.
7. Performance Agreements With Clients
What it is: With this consulting fee structure, instead of charging only a flat fee, you create an agreement where you also earn based on the results of your work. It incentivizes performance and can lead to higher earnings without additional time commitment.
Example: A sales consultant takes a smaller upfront fee and includes a clause in the contract that grants them a bonus based on the increase in their client’s sales figures following the implementation of their strategies.
By building one (or more) of these passive income methods into your consulting practice, you’ll diversify your revenue streams and earn more while freeing up time.
It’s about leveraging your expertise in scalable ways.
As an added bonus, many of these passive income methods will also generate interest in your “higher-ticket” consulting offers.
Get Help Building Passive Income Sources
Are you looking for customized help building passive income sources inside of your consulting business?
Not only have we built passive income into our own business (through programs like Momentum), but we’ve also helped our Clarity clients do the same.
NOTE: Creating passive income is an advanced strategy. We recommend you get a solid foundation in place first (clarity around your ideal client, magnetic message, marketing engine, and getting amazing results for your clients) before you start thinking about passive income.
In our Clarity Coaching program, we’ve helped over 1000 consultants to build a more strategic, profitable, and scalable, consulting business.
Learn More About Clarity Coaching
We’ll work hands-on with you to develop a strategic plan and then dive deep and work through your ideal client clarity, strategic messaging, consulting offers, fees and pricing, business model optimization, and help you to set up your marketing engine and lead generation system to consistently attract ideal clients.
You’ll learn how to make more money with every project you take on — and how to land more clients than ever before. Learn more about Clarity Coaching and get in touch to talk about your situation and goals.