Some folks think it’s never good business to turn away business. I beg to differ. In fact, there are times when new business will cost you money, tarnish your reputation, and possibly even damage the long-term prospects of your organization. You’re probably thinking, “You’re kidding, right?” The fact is, there are times when it’s good business to turn away business.
Less can be more.
Subtracting Business Is as Important as Adding It
If you’re one of those folks who believe that new sales are always a plus, the customer is always right, or you should never turn away business, here are 10 cases where that thinking can cost you dearly.
Holding a fire sale. There are many reasons why people sell products or services for a VERY skimpy profit. For example, some folks panic when they hit a slow period. Others offer quantity discounts even though the customer doesn’t qualify for them. And of course, some salespeople discount goods just to get the order. As the saying goes, “They lose money on every sale, but make it up on volume.”
Failing to satisfy needs. Some people make the sale even though the product or service won’t satisfy their customer’s needs. That doesn’t stop them, but it should. If you think good news travels fast, know that bad news travels faster. The fact is, a one-time sale should never trump a long-term customer relationship.
Making false promises. Some folks close a sale even though they don’t have the resources, capacity, or the experience to deliver on their promise. They think they’ll get the order and then figure out how to deliver it. Or they’ll fake it, and outsource the business to another organization. If that thought crosses your mind, think again.
Accepting unrealistic customer demands. Some customers are high maintenance. (Ugh!) They’re demanding, unreasonable, and expect special treatment. The truth is, you’ll never make those customers happy. Plus, they’ll be the first ones to post negative reviews on social media. Ask yourself whether their business is worth it.
Ignoring ill treatment. Some customers are mean spirited; they mistreat your employees and destroy your other customers’ experience. These customers will sap your energy and demoralize your staff. Don’t take it personally, though; they treat everyone that way. Customers who play games should find someone else to play with.
Losing focus. The 80/20 rule, also known as the Pareto Principle, suggests that 20 percent of your activities account for 80 percent of your results. That principle can often be applied to your customer base — 20 percent of your customers contribute 80 percent of your sales volume. Having said that, if you let “high-maintenance” customers distract you from your top ones, your best customers may feel neglected and leave for greener pastures.
Tolerating greed. Some customers want to prove they’re in charge. They’ll “beat you up” or nickel-and-dime you to death — until you surrender. They refuse to accept the fact that all business relationships should be win-win. That behavior can take a tremendous toll on your psyche as well as your bottom line.
Winning at all costs. Some salespeople will do anything, and I mean anything, to win. That includes making promises they’ll live to regret. It’s better to walk away from a sale than to lose your shirt.
If you sell strictly on price, it’ll cost you dearly.
Trying to be all things to all people. Some folks forget what business they’re in. (Their company is a mile wide and an inch deep.) They’ll take on anything that walks through the door. The fact is, being all things to all people is a guaranteed recipe for mediocrity.
Caving in to unethical or illegal demands. Some folks will do just about anything to get a sale — including deceptive or illegal practices. They know that what they’re doing is wrong, but they rationalize their actions by thinking it’s just one time. The truth is that it rarely is. You may get the sale, but you’re selling your soul in the process. You be the judge whether that cost is too high.
The next time you celebrate a sale, make sure it’s in your best interest to do so. As the saying goes, “Knowing when to walk away is Wisdom. Being able to is Courage. Walking away with grace, and your held head high, is Dignity.”
Do You Turn Away Business?
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