When to say NO to new business

Is there ever a time when you should say "No" to new business? It may seem counter intuitive, but saying "No" can actually save your business.

I was introduced to business many many years ago by sales people who loved to say things like...

"Whatever the question, the answer is Yes."
"Say yes now and worry about it later."

Faced with a prospect on the verge of signing a new deal, the sales person will promise the Earth if it gets the order.

This misguided advice meant that I was programmed to say Yes to any new business that came my way, even if I was not prepared or setup to complete the business without a major restructure. After all, any new business is good business, right?

Every business, whether you are selling products or providing a service, must have a core strategy. This is the business that generates the most profit. It is your 'bread and butter' without any trimmings. You excel at what you do, and - most important - you enjoy it. This is why you are in business - to enjoy the work that you do and make money at the same time.

Then, along comes a prospect or two, and they ask for something different, requiring a change to your core business. However, it would mean that you have to divert a great deal of your time and/or money to restructure your business (product or service) in order to complete the order. It is a one-off order, something very bespoke, and it is very tempting - perhaps even a challenge. Do you say Yes?

Consider, if the project is going to take twice as long and cost twice as much to complete, and for no greater return, then the answer should be No. It is a difficult call to make, and one that I have fallen foul many times. The temptation is to take on new assignments or projects whenever they present themselves, because that is what a business does, right?

I recently took on a major new project to design a new content management system, simply because there wasn't anything else out there at the time that included all the special features that were being requested by a few of my clients. It was a major task that would take months to develop. It increased my workload and stress levels to breaking point, and resulted in me losing focus on the core business - supplying websites for photographers & small business. I had to force myself to return back to basics, or face the consequences in health and business. So I decided to use what is already out there, instead of re-inventing the wheel. This made it possible for me to return to 'business as usual', and back to a home life without the stress.

Sometimes you have to ask the question... Is it worth it? Saying yes can have a negative impact on your business as well as your personal life.

Let's look at 7 examples where it is appropriate to say No.

1: When your business is not prepared for it

It can be tempting to take on a new project even if you are not geared up for it. This can result in your funding getting diverted from its original purpose. If you don't have the specialist equipment needed for a speculative project then leave it for another time when you do have the resources.

2: When it is not viable

You can easily waste weeks or months working on a vague opportunity that is never likely to convert into a profitable market for your business. Concentrate on your core business and don't get distracted by fleeting temptations.

3: When you don't have the time

It is too easy to get caught in the moment when customers are begging for your services, and you say yes to everyone. Then you have a nightmare trying to complete all the jobs, in the time you don't have, while trying to maintain same standard and professionalism that your customers expect.

4: When it is unrealistic

Customers may have no idea what is involved in completing an order - the technology or the logistics etc - and so we often hear them say "I need it yesterday". If the project is likely to take much longer than their expectation then you have to be honest, even if they say it is unacceptable. Don't allow yourself to be bullied into an impossible situation - it is safer to say no.

5: When it slows you down

You should be able to project how much business you can expect to do in the current year, and how much profit you expect to make. If a new project is likely to interfere and put the brakes on your projections, then you will be making less than expected. That 'interesting opportunity' could end up costing you dearly.

6: When it is not profitable

The bottom line for any business is 'the bottom line' - your profit margin. If you are not making a profit then you have nothing to invest going forward, so if that new project is not going to help improve your profit margin, then why are you doing it? If it is simply to aquire new contacts or experience, then as long as those contacts and experience generate extra value, it is best to say no.

7: When you are being over confident

When someone asks you to do something which is out of your comfort zone, or area of expertise, then it is not a good idea to say you can do it. The end result will likely disapoint your client, who will be expecting nothing but the best. You will not only lose the confidence of your customer, but also your respectability, and any future business with them.


There is always the risk that saying 'No' will disappoint a few customers, and maybe lose some business, but you will benefit by spending more time on your core business activity (and your core customers) which is the one thing that brings you the highest return in profit - and peace of mind.

Once you start down the road of saying Yes to every demand, then that is when you begin to lose control. You are at the mercy of anyone who wants to take advantage of your generosity. Concentrate on what you do best, and for the people you like working for. This generates loyalty, which attracts more like-for-like business, and that is the business you need most of all.

When the time comes to say yes or no, ask yourself this question (honestly): Do I really need it?

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