I am giving a presentation on the business essentials that you need to know before you start a career in independent statistical consulting. Here is a summary of what I’ll be talking about.


A career as an independent statistical consulting is very rewarding, but it demands that you pick up many new business and legal skills, skills that you probably didn’t learn in graduate school. We will review the administrative details in setting up a new business, including accounting, insurance, contracts and billing. This is not intended as a substitute for talking to a professional accountant and a lawyer, but should help you become aware of the issues and questions that you need to raise with them.


My career in statistical consulting started in the 1970’s as a student consultant at the U Iowa. In the 1980’s, I spent one summer as a faculty consultant at Bowling Green State University. In the 1990’s, I became a government consultant and started getting a few independent clients. In the early 2000’s, I had to tell people, sorry, I’m too busy. But in 2008, I decided to quit my job and set up an independent consulting business, P.Mean consulting. I also found a part-time faculty position in the Department of Biomedical and Health Informatics at the University of Missouri-Kansas City.

When I started my own consulting business, there were no obvious guides written by statisticians on how to do this, so I started documenting things and presented these at various conferences and on the web. I’ve also gotten a lot of advice along the way from other independent statistical consultants.

So how has my consulting business turned out? If you measure the success of my consulting business by the amount of money I’ve earned, I would barely get a passing grade. If you measure the success of my consulting business by how happy it has made me, I would get an A+.

What do I like about consulting? You are your own boss. You are in control of your schedule and can refuse to work with certain clients without any penalty. You can actively seek work in areas you find interesting.

Before I start describing some basic business essentials, I should offer two warnings. First, there are way too many people who will tell you exactly what you need to do to set up a career in independent consulting. I am not one of those people. Every person’s situation is different and what works for one person may not work for another. I’m better at raising questions than answering them.

Second, I am not a lawyer (or an accountant). I want to give a general overview of the many business decisions you need to make, but you need to talk to a professional lawyer and a professional accountant before you decide on any course of action.

Business models

There are many business entities that you can create for your consulting venture, but the simplest, by far, is a sole proprietorship.

In a sole proprietorship, you are doing business under your name.