Why You Have To Reject Customers If You Want To Succeed

I want to talk to you about why it’s sometimes far more important to reject a potential customer or client than to say yes.  In fact, if you are building a business, get used to saying no, a lot.

At my new cybersecurity company, LMNTRIX, we work off a validated architecture that detects and responds to advanced threats that bypass customer’s perimeter controls, one that requires the client to have at least four security controls in place on their network before we are engaged. 

If you do not have these things in place, and we were to sign you up as a client then the quality of service you would experience would be sub-optimal and we cannot afford to do sub-optimal — our renewals and referrals depend directly on the quality of our service and our reputation.  We’d have to say no.

This was pretty much the case recently with one potential client.  Okay, so I’m exaggerating a bit here to make a point, we were in the exploratory stages of a relationship and didn’t reject them outright, but we made it clear they weren’t a fit for our service yet.  If they changed things, they might be, but definitely not now.  I had learned this lesson about  a long time ago, and I want to share it with you now because the wrong clients or customers can literally ruin your business.

At my last company, earthwave, we sometimes got stuck with clients that seemed to have been put on earth to make our life miserable. We had signed long term contracts with them and we couldn’t easily get out of them. My team despised these types of clients. They were rude, unrea-sonable and drove the relationship based on SLA’s and penalties instead of trust and mutual re-spect. It seemed that they existed to go to work every day and find faults in our service. I used to indirectly terminate these clients by doubling their contract renewal price. The relief from my team when we lost these clients was priceless.

Other times when I practiced this method of terminating contracts, it was against unprofitable cli-ents who were costing us more to deliver than what we had originally signed up for. This was gen-erally because they were going through a massive IT transformation or growth and they didn’t want to pay more for the extra work from us.

Most of us spend more time at work than with our families, so shouldn’t it be our priority to make sure that the time we spend at work is at least pleasant?

I found one way to achieve this was to make sure we chose the clients and partners with whom we wanted to do business. Just like clients assess us through exhaustive tender processes, we too have the right to assess them and decide if they are right for us.

In my case, for example, when clients call and request a pitch, a quote, or that we respond to their tender, I generally say, “Would it make sense to first figure out what two or three problems you’re trying to solve so I know what to send you?” or I would say “Well the interesting thing is that in our company we have a similar process to you. We have a ‘Phase One’ where we first collect in-formation to really see if we are a good fit or not. Would you be open to having a conversation about that?”

I don’t know of many companies that are selective about the clients they choose, but in my case I found it to be key to both my happiness and to that of my team.

A version of this article appeared earlier this month on Dynamic Business.


On 2017-07-06

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