How to Grow By Saying No
When trying to grow a business, one the hardest things to do is say to no to any kind of new revenue. Cash flow is so important in the early stages of development that many people will accept any type of new business out of fear that the next lead may be a while. This thought pattern will actually lead to stagnation or worse, a decline in revenue.
In order to grow your business, and maintain your sanity, you must learn to say NO. Saying no to potential new clients is something they do not teach in business school, and in the real world of entrepreneurship, is very difficult.
At Bourn Creative, we have experienced growth year after year, and one element that continues to thrive is that we actually have become more selective on who we choose to work with. I know that seems a little backwards, as clients are also choosing to work with us, but let’s face it, clients shop around, so why shouldn’t you?
Accepting less than your ideal client usually has one of three outcomes:
- You work way too hard to make them happy, and end up eating it on your hourly rate or sacrificing sleep and time with your family.
- The project gets completed to your standards and their expectations, but you never hear from them again. No repeat business, no quality referrals, and no raving fans that will help promote your brand.
- The project goes sideways and you find yourself either in a contract dispute, or end up working for free after you give a refund.
FYI, all of these have happened to us in the past, and one of the ways we have been able to maintain a steady stream of great clients now, is by being selective and regularly just saying no. It took us awhile to get here, but after looking back we have identified some common elements that usually lead to less than an ideal client or project outcome.
Six Red Flags That May Signal a Big Fat NO!
Your prospect is price shopping. If during your initial conferences, your prospective client is too focused on cost, and not results, you have two options; say no, or see how good of a salesperson you are and use the opportunity to convince them why you are truly worth the investment. Sometimes people just need a little nudge to move forward. If their only concern is price, nothing you say will change their mind.
Your prospect doesn’t really want to work, or has unrealistic expectations. This is harder to sniff out during a preliminary meeting, because most people are genuinely excited about starting something new. The key to filtering out the prospective clients who have a get rich quick mentality, or approach their business like a hobby or side job, is to set clear expectations before a contract is signed. It’s OK to set expectations for clients before you engage in business. The ones that are truly ready to work with you will appreciate your seriousness, and the ones that are not will move along to someone else who will tell them what they want to hear.
You don’t understand or believe in what your prospect is doing. If during your preliminary interviews, your client can’t articulate their ideas enough for you to understand their vision and their goals you are probably not meant to work together. Also, if they engage in something that you have a moral dilemma with or simply find ridiculous, don’t take their money and try to do a good job, because you won’t.
Your prospect asked you to do something that is out of your circle of competence. If someone asks you to do something that you do not know how to do, kindly decline, but use this as an opportunity to evaluate if their request fits into your big vision of yourself and your business. If it does, you should be motivated to go out and enhance your skill set and grow your offerings. The first time you try something new in your business, it shouldn’t be an experiment on your client’s dime.
They do not understand or value your process. Our roots were formed as a design company, and still rely on our creative process to get the results we get. This takes time. I have yet to find someone who can create someone’s brand, design their logo and collateral materials, build an awesome website, conduct keyword research for SEO, craft a marketing plan, and then get the implementation going in a week. After you explain everything, if your prospective client doesn’t understand why it takes the time for you to work your magic, they may not be the bet fit for you.
No matter what nothing you do for them will help. It is easy to take money from someone; the hard part is feeling good about. If your potential client has a flawed business model or engages in practices that you know will not convert sales, and is not ready to receive constructive criticism, they are not your ideal person to work with. Let them down easy and move on.
How to Say NO Gently and Professionally
After you have made the mental decision to say no to your potential client you must do it gently and professionally. One good tactic is to state that you are simply too busy to take on any additional clients, and then provide an actual referral to somebody else. This is great a chance to refer business to someone you may be in competition with or someone who needs the work more than you. They are not your ideal client anyways, so who cares, and they will love you for it. A little Karma goes a long ways.
It is hardest to say no the first time, because you are turning down revenue. We personally have said no to some monster projects, based just on the vibe we got from the prospect. It was really tough turning down that much money, but after looking back, I am really glad we did. It just wasn’t a good fit and would have probably sucked us dry.
So trust me, after a few times it gets easier to say no, and after a while, you will only be working with your ideal clients who will truly value your abilities, become raving fans and repeat customers for life, and provide an endless supply of quality referrals.
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Feedback and Comments:
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Sep 02, 2010 at 11:55
This is a great article. It’s so important to select our clients wisely. I resonated with many points above. I have certain clients that I really love to work with because they respect me, give me space to do my work and truly appreciate the work I do. At the same time, I get offers to do work for the half of what they pay me and the expectation is that it’ll get done in half the time my other clients give me too. Hmm, what should I choose? :)
I think it’s so important in business to establish a good relationship with clients. When that’s not there, it doesn’t feel good and it’s not fun either. :)
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Sep 02, 2010 at 01:02
Ryan – Thanks for stopping by the blog! Isn’t it funny that the most demanding people, with the most unrealistic expectations seems to always be the ones who want the “deal” … It was a hard lesson learned for me. I gave the deal too many times and ended up working for peanuts and getting taken advantage of. There comes a time for every entrepreneur and business owners when enough is enough and you decide to only work with your ideal clients. And that, is the day everything changes!
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Sep 02, 2010 at 01:46
I can relate to these points, I am now convinced and try to be selective… but it’s hard, especially when you are a group of entrepreneurs working together…
You tend to still do it for the cash flow… but then no one is happy!
I really hope the tips here can help us all to grow more!
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Tweets that mention How to Grow Your Business By Saying No | Bourn Creative -- Topsy.com
Sep 02, 2010 at 02:15[...] This post was mentioned on Twitter by jenniferbourn, jenniferbourn and Gary Pilapil, George Valenzuela. George Valenzuela said: RT @jenniferbourn: Can you say no to new clients? http://fb.me/InzU3wjp [...]
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Sep 02, 2010 at 08:56
“Isn’t it funny that the most demanding people, with the most unrealistic expectations seems to always be the ones who want the “deal” ”
So so true. :)
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Sep 06, 2010 at 01:18
I wish I had read your post a year ago because I have taken on more then I should have and it was a waist. All of your clients suffer when you over commit yourself and the negativity of one can spread like a virus.
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Sep 06, 2010 at 01:35
Yes…the no word. It’s not only hard to do at the start of a new business, but I’ve found also hard to do when the business climate is bad and income is needed…as I think many of us found over the last few years. Thanks for the reminder and while hard to say that first no, in my experience to not is worse!
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Sep 06, 2010 at 03:36
Jennifer, you rock. I’m in start up mode. While I knew most of your points, i badly needed to be reminded of them at this time. Thanks.
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Sep 06, 2010 at 04:23
Thank you for this really helpful list of criteria on how to say no to a less than ideal client. I have been working on this issue with one of my coaching clients and I’m going to direct her to this post. I know it will help her! It’s already helped me!
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Sep 06, 2010 at 05:57
When I used to practice law, it never failed that the most demanding clients were the pro-bono clients. I don’t know which came first- the chicken or the egg. Were they demanding because they felt bad about not being able to pay or did they just expect something for nothing and with that mentality, they were always going to be poor and demanding?
I wish I had known these points back then as it would have saved a whole lot of grief. As you said, it was hard to learn, but it did become easier and easier the more times I said No.
Good post!
Candace Davenport
http://www.ourlittlebooks.com ~ Little Books with a Big Message -
Sep 06, 2010 at 07:13
I actually started off in my line of business by saying ‘No’ to my first client. I interviewed a potential host mom to see if they were suitable to host an AuPair and their expectations were completely unreasonable. So, I said ‘No’. It is just going to be too painful for everyone if I place an AuPair with a family that needs too many hours or is looking for more of a housekeeper. Thanks for the reminder.
Louise Edington – International AuPair Finder
louiseedington.com
ledington.aupairnews.com -
Sep 06, 2010 at 10:38
I couldn’t agree with you more. I remember years ago the most liberating entrepreneurial decision I ever made was firing a client that made up a significant percentage of my company’s revenue.
Today I remind investors all the time to say no whenever their gut is making them feel uncertain. Saying no is the best skill any business owner or investor can acquire.
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Sep 06, 2010 at 10:41
I have learned this the hard way, in particular the client that keeps coaxing more out of you after knocking down your original price to bare bones – similar to what has already been commented by Ryan and Jennifer. I would also add to this, say no to some joint ventures.
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Sep 07, 2010 at 11:32
That is a good point Kathy. Saying NO to joint venture opportunities, subcontractors, and vendors is just as important as filtering out less than ideal clients. I say go with your gut, and if it doesn’t feel right, there is probably a good reason.
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Sep 07, 2010 at 11:42
In my private speech-language pathology practice, I had to learn this lesson through trial and error. It was hard for me to say no, but everything you say is true, and experience began to teach me. I appreciate reading your tips even though I’m doing different work now. It’s so easy to slip back into the mode of wanting to accommodate and please everyone. I don’t think I’ll ever permanently have this one down!
Judy Stone-Goldman
The Reflective Writer -
Sep 07, 2010 at 02:15
Excellent post, Jennifer; so much of what you say is true for our business as well. Especially the price shoppers and those who do not understand the value of what we are doing. We too, have learned to say No to some customers based on what we see would only be opening a can of worms or would not be the best scenario for us or them. And we have referred those people to other shops we know would be a better fit, unless the potential customer is someone we would not wish on anyone!
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Sep 08, 2010 at 07:44
Wish I would have read this about 2 years ago. Had a customer with Send Out Cards that I didn’t feel good about right from the beginning. He loved the system but wanted me to do all his cards for him. He loved the idea but just didn’t want to do the work. He signed up, buy sadly, he’s never sent a card, well except the one I did for him.
The thing is I feel awkward everytime I see him, like I sold him something that he didn’t really need or want. Even though, he wanted it and loved it.
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Sep 08, 2010 at 01:33
I couldn’t agree more, you took the words right out of my mouth! This is something that I have had to learn the hard way. Saying no to income is very difficult, but I have definitely found that if I ignore those red flags, I end up working for pennies an hour for a client with endless demands.
Thanks for the reminder, Jennifer!
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Sep 09, 2010 at 08:20
You summed it up perfectly Jennifer – after you’ve done it a few times, you realize the cost of taking on a less than ideal client far outweighs the short term cash benefit.
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Sep 09, 2010 at 08:57
You know, I have always been able to say no in other areas of my life, but it is hard in business – that paranoia that there won’t be something to replace it. Of course, in the long run, you are right, you have to set your boundaries and identify right away whether you are a good fit for your client and vice versa.
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Sep 11, 2010 at 11:41
Jennifer you bring up a really important part of making a business work. Confidence is key to saying no to anything, and setting boundaries. Some great tips on how to evaluate and say no.
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