Ep. 272 - When Sales Should Say No [Business 300]

0:00I'm saying no to go in over five minutes. Saying yes to the wrong customer for the wrong work at the wrong price is not winning. No matter what your sales manager is telling you, sales teams are wired and incentivized to close deals. That's the job, and that's good, but the problem occurs when a prospect asks for something outside your core offering, a tangential add-on, and a relevant service, a custom modification. The instinct for the salesman is to say yes, whatever it takes to win the customer. In the moment, it feels like the right call. You captured revenue you wouldn't have otherwise. You beat a competitor, you proved your flexible, responsive, customer focused.

1:00But then the deal lands in operations. And operations has to figure out how to deliver something they've never done before. They have to pull people off existing work, they have to improvise processes, they have to cobble together a solution. Meanwhile, your core customers, the ones you're built to serve, get slower service, less attention, declining quality. Your diverting resources to deliver work you don't know how to do. This is short-term thinking dressed up as hustle. You won the sale, but you lost the business. If your business is just starting off and you're still feeling around for your identity and your ideal customer profile, it makes sense to try on new clothes to see how they fit. But if you've established your core competency and value offering, then add-hawk your relevant add-ons, hurt your business. Every time sales says yes to work outside your core value proposition, you're paying a hidden cost, a cost that doesn't stay hidden for very long. First, you're distracting the team. Business isn't focused on delivering excellence in what you're built to do. They're scrambling to figure out how to deliver what you promise but aren't equipped for.

2:00That fragmentation kills efficiency and quality across the board. Second, you're breaking your systems. Your processes are designed around your core offering. When you take on tangential work, these processes don't apply. So now you're custom building everything, quoting delivery support. You lose the leverage that comes from repetition and you lose the team discipline you've spent years building. Third, you're training bad customers. When you say yes to request outside your lane, you're signaling that your value proposition is negotiable. That customer learns you'll bend. And they'll keep asking for more, pulling you further from what you're good at. Fourth, you're eroding margin. Custom work takes longer, cost more, and carries more risks. Even if you think you priced it right, you probably didn't account for the coordination cost, the delay to other project, the opportunity cost of what you didn't do because you're doing this. If it's not something you do, you don't know what you don't know. And last, you're building a business you didn't intend to build. One sale at a time, you're drifting away from your core value proposition toward a scattered mess of unrelated services.

3:00You're becoming everything to everyone, which means you're not particularly good at anything. Sales thinks they're being customer focused, but real customer focus is delivering exceptional value in what you're built to do, not mediocre value in whatever they ask for. So if you know and are good at your core value proposition, and a customer is trying to pull you away from it, say no. If it's not what you're built to deliver, it's a distraction. If a potential customer is only interested if you're willing to do the irrelevant add-on, say no. They're not your customer. If delivering the add-on would compromise your ability to serve your core customer as well, say no. Your focus must be the customers you've built your business to serve. If you have to discount, customize, and scramble to make it work, say no. You're supposed to build a sustainable business, not just keep busy. I get it, saying no to a sale is hard. It feels like leaving money on the table, but the money you leave on the table by saying no to bad fit work is less than the money you lose by saying yes to it. Teach your sales team that their job is not just to close deals.

4:03It's to close the right deals, deals that align with your value proposition, deals that leverage your systems, deals that make the business stronger, not more fragmented. Winning the wrong customer is losing. Stay in your value delivery lane. There are times when sales should say no.