When Turning Away Business is Good for Business
February 23rd, 2011 by Janna Polzin
When I tell other business owners that my company regularly turns down projects, even during lean times, they are in complete disbelief! This practice completely opposes the goal of most businesses to work with as many clients as possible. So what is my reasoning behind this strange decision?
It’s actually very sound business advice. Here’s why we do it:
1) Personal Joy: We know what types of projects motivate us, inspire us and make us feel good every step of the way. On the flip-side, we also know what types of projects drain our energy and leave us asking why we took the project in the first place.
Since I started this business to be happy and less stressed with my professional life, I have to make sure the projects we choose to take contribute to our happiness level and my desire to keep stress to a minimum.
This is good for our clients too. When everyone involved is happy, the project is much more successful!
2) Negative Client: We have a checklist to gauge the budget, knowledge, expectations and needs of a new client. This helps us determine if we’re the right group for the job. But while they are interviewing us, we’re also interviewing them.
You can usually tell in your first discussion or two if a potential client is going to make your life difficult for the next 3 three months. They usually make statements like: I could do this myself, but I don’t have time, I’ve gone through 5 designers in the past year, or I need A, B, C and X, Y, Z but I spent my budget on something else so I’m hoping you can give me a break. These are big red flags for us!
Historically, the projects with clients who use those types of phrases are unappreciative and never satisfied. We end up wasting so much time trying to please someone who is impossible to please and it eats up all our profit. These days, we look for indications that a client is going to be overly difficult. If we determine they will be, we kindly pass.
3) Above or Below our Capabilities: We’re flexible, but we do have a process we like to stick to.
Our process works very well for particular types of projects and not so well for others. For instance, we’re a great fit for projects for small and mid-sized businesses desiring custom design and integrated websites in the $15K-$85K range. But our process does not scale well for very small projects under $10K because those require us to trim key services. Then the end-product will likely fail our high quality standards.
Very large projects do not work well within our process either because they require more time and resources than we are willing to invest and, to be honest, it’s not fun to work with companies that are too big!
4) Unreasonable Time Lines: We can turnaround a project quickly and our schedule can be flexible to meet certain time-sensitive requests. But when someone expects a project to be done in a time frame that our schedule just can’t accommodate, we’ll let them know we aren’t the ones for the job. Speeding up too much can negatively effect the quality of what we produce and we just can’t live with that!
5) Questionable Morals/Ethics: My business partner was attending a networking event a few years back when he was approached by a very professional-looking woman who inquired about our company’s services. She conveyed in detail everything she wanted us to do. Her budget was reasonable. It sounded good!
But then she let him know it was for a pornography website. Without hesitation he turned her down (and then she got very angry with him and had a few choice words, but that’s another blog post!)
She may have been the best client in the world, but we choose to maintain a certain moral standard and refuse to cross the line. We don’t do projects that are related to pornography, promote illegal activities, or that are harmful to others.
How To Determine If You Should Turn Away Work
First, you have to know your strengths and limitations. Is there something you can’t do, or just don’t WANT to do? Don’t take on projects that require those skills.
Second, know what types of clients you like to work with. What’s your ideal client’s budget, time frame, participation level, and industry? The more detailed, the better. To make sure you’re being realistic, also ask if you’re the ideal provider for that particular type of client.
Third, take the time to ask questions during the initial discussion to find if the company you’re talking to is more in line with your ideal client or one you’d rather avoid.
If they don’t make the cut, as hard as it is, politely let them know you aren’t a good fit and send them on their way. Your time is better spent engaging your great clients and reaching out to new great clients. Dealing with negative clients and projects will use up your energy and resources and you’ll be burned out and unprofitable in no time!
Now it’s your turn! Do you turn away projects? How do you do it? Share your story here.
February 23rd, 2011 at 11:24 PM
Do you only turn down potential clients, or do you also refer prospects to other consultants/agencies you know or partner? For instance, if I came to you with a desire for you to help me with X, but for whatever reason you don’t know or can’t do X, would you refer me to someone before disconnecting that conversation with me?
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February 24th, 2011 at 6:51 AM
Thanks for your comment, Ari. Good question!
Absolutely. We gladly refer companies who are not a good fit for us to others should they seem to be a good fit for someone we know. When we can’t do that, we usually spend 5 minutes educating them about what to look for, what to avoid, etc. as they search for someone else.
Fortunately, most people who come to us are a good fit, so this isn’t something we have to do too often.
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February 24th, 2011 at 5:37 PM
Knowing your personal motivations and sources of joy definitely helps in defining what we let into our business/personal life. Saves us unnecessary headaches when you can cut it off right from the start. It could be draining precious energy to deal with things that demotivate us. Kind of defeats the purpose for going into business in the first place.
I’ve had my fair share of projects that were just plain draining, unfulfilling and downright wrong to take on in the first place. At the very least, now I’m getting a lot better at identifying red flags. Misteps still happen but always shooting for alignement and good energy.
-Pablo
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