Operations Archives | The Small Business Blog for Service Businesses

When to Say No to a Customer

For many years, “the customer is always right” has been a mantra of doing business. After all, when you want a customer to say yes to buying your product or service, it helps to say yes to them. And creating a positive and enjoyable customer experience leads to sales. Which means that telling a customer no is the last thing you want to do. So it may surprise you that there are times when saying no to a customer is actually a good thing. Not just for you, but for your staff and your bottom line. Here are 4 times when to say no to a customer

#1 Say No to Protect Staff

A business doesn’t exist without revenue. And clearly, revenue doesn’t happen without customers saying yes to purchases. So why say no to a customer? One good reason is to protect your staff.

Why? Because a business also needs staff. Especially a service business. You must have qualified trained staff available to do the work to fulfill client requests and bookings. And these days, labour shortages are making this very difficult. Small business owners are facing huge challenges in hiring people and growing their team. The US Chamber of Commerce reports that there are simply fewer people looking for work since the end of the pandemic.

Which means that staff retention is more important than ever.

Also, if staff is offended by the way a customer behaves, they can simply quit. And finding a great new hire may be more difficult than finding a new customer.

So say no if a customer says or does things outside the code of conduct for your business, and causes your staff to be uncomfortable. Whether it is a racist or homophobic comment, or anything sexually inappropriate, this is when to say no to a customer. And be sure to let your team know that you have these policies in place. Knowing that you are committed to providing them with a safe working environment will help you attract and retain great staff.

#2 Say No to Reduce Risk

Another time when to say no to a customer is when their request creates a risk for your business. How to define risk? That depends. It’s different for every business. So consider what matters in your business.

Here is an example. Say a customer requests that your team do an additional task or service that falls outside the scope of what they are trained to do. Sure, the customer would be thrilled if your staff went ahead and did it. And they may tell all their friends and neighbours about how your staff went above and beyond, which would bring in referrals. They may even tip your staff, which would make your employees very happy.

But.

What if your staff gets injured doing that thing they were not trained to do? Like they are there for a landscaping project and then climb up a ladder to get the frisbee off the roof? Not only do you have an injured employee and a gap in your booking schedule, but you have a world of hassle and expense dealing with insurance.

And by the way, your business insurance and workers compensation is not going to want to pay out on a claim arising from staff doing what is NOT in the scope of services for your business.

Which is exactly why it’s better for your business and your staff to say no to those extra requests that fall outside of your normal business operations.

#3 Say No to Protect Profits

Now, you may be wondering – how is saying no to a customer going to protect profits? In fact, there are situations when refusing a customer request is the best thing for the revenue and profits of your business. For example, when customers ask for extras that are over and above what was in the contract or service agreement. Sure, there are times when wowwing your customer is the way to go. However, it is also possible that saying yes to requests for extras just eats into profits.

As explained in the example above, customers may ask for additional tasks and expect them to be done for free. Though going up that ladder to get the frisbee off the roof may not seem like a big deal, if the whole thing took 30 minutes, that adds to the cost of labour for the job. Especially if the customer then asks for some other little tasks to be done. Because they may be thinking “since you are here anyway, could you please….” But time is money in a service business, and you have to contain the work to what was agreed upon.

Of course, if the customer is asking for extras that you normally do and are willing to pay for them, then say yes! Because that is not eating into your profits. For example, your customer comes in for a haircut and then asks to get their hair coloured. If you have the time to do this extra work and they are paying for it, this is a great thing for your business.

To be clear, when to say no to a customer is when they ask for extras to be included in a project with a fixed price. Agreeing to do freebie extras sets a dangerous precedent with your customer. Now your customer will expect yes to all their requests for little extras. And all the people they refer to your business will ALSO expect yes to all their requests for unpaid little extras. This snowballs pretty fast and will end up costing your business money.

#4 Say No to Protect your Brand

Branding is an important way to differentiate in a crowded marketplace. A brand is how to stand out, get noticed, and land customers. So protect your brand and say no to anything that will dilute or damage it.

This can be tough for new businesses or during quiet seasons. After all, when a customer wants to hire your company, you want to take the business. However, there are times when it’s important to say no because it will just cause confusion and unhappy customers later on.

For example, you are building a house painting business. Your brand values are quality, professionalism, and reliability. This shows up in your tagline, website copy, and marketing. Then a customer who hired you for a small job painting one room in their house asks if you can do some handyman type tasks. Since you have the tools, the time, and want the extra income, it’s tempting to say yes. But this is when to say no to a customer. Because you are building a house painting business. So stay focused on house painting.

Just think about what happens when customers think you do home repairs and handyman jobs. These are the referrals you’ll get. And these are what your online reviews will be about. Imagine a potential customer checking you out on Yelp or HomeStars and reading “they did a great job installing our ceiling fan.” This is going to cause confusion when your business name and brand message is all about providing quality house painting. And creating any uncertainty in the decision making process of your audience is when you’ll lose out on a lead.

Remember, KFC built their brand to be about chicken. They didn’t dilute this association by adding pizza to their menu!

Conclusion

Growing a business takes time and consistency. And also, focus. So there are times when saying no to a customer is the right thing to do. To protect the safety of your staff, to reduce risk, and to protect your profit margin. Most of all, to ensure that the actions of your business is aligned with your brand and reputation.

Now that you understand 4 times when to say no to a customer, read this post to learn strategies for HOW to say no.

When to Say No to a Customer Read More »

Business Startup Tips from Ricky Yean, Co-Founder of Flow Club

Operations

It’s no secret that I’m a big fan of Flow Club, an online work community which creates an environment for focus and productivity. Since I’m a curious person (which I argue is a trait all entrepreneurs have in common), I found myself wondering about its origin story. And that led me to connect with one of its co-founders, Ricky Yean. Ricky is a successful 3X start up entrepreneur. I’m grateful he took the time to answer my many questions so I can share these business startup tips.

1. Don’t do it alone.

First, expect to work with someone. Though solo CEOs are widely celebrated in our culture, the reality is that big businesses are rarely created alone. It takes a team. After all, Jeff Bezos built Amazon with the help and support of his wife. Brian Cheskey developed Airbnb alongside 2 friends. And Ricky Yean worked with David Tran to create 2 other successful ventures before starting in 2021.

Trust is important, and so is sharing a vision for what you are creating. As Ricky shares, “the startup journey is an intense one, and having a partner who I value and trust immensely enables me to bring my best self to work every day.”

So the top of this list of business startup tips is to work with someone who is engaged, committed, and ready to put in the hard work required to achieve success. Doing it alone is more likely to lead to burnout and failure.

2. Work with your strengths and weaknesses

Second, know yourself. In what areas are you most effective? And what are your limitations? As Ricky explains, “David and I both pride ourselves on being self-aware regarding our strengths and weaknesses, and we also pay attention to which aspects of company-building we “love” vs. which we “tolerate”. We use this awareness to divide responsibilities so that wherever possible we are both working on exciting activities that reflect our strengths. This helps us maintain our energy on this journey together.”

The tip here is to let go of ego. And don’t let pride get in the way of what the company needs. Structure tasks and responsibilities to work with your strengths and weaknesses.

3. Be willing to adapt

Sure, you start out with a specific idea which has you fired up and excited. But one of the most powerful business startup tips is to be willing to adapt. Be open to letting the company evolve and change.

Why?

Because continuous innovation in response to performance metrics is effective for creating a successful business. This approach is best described in The Lean Startup by Eric Ries, which is an excellent book for all startup entrepreneurs.

And there is a long history of entrepreneurs hitting it big only after making changes to their original concept. After all, Wrigley didn’t begin his business selling gum, and Airbnb never intended to rent out empty homes. For more about these and other famous pivots in business, read this article.

When I asked Ricky how FlowClub has evolved since launching, he shared that “so much has changed, but perhaps the most pronounced has been the emergence of Flow Club as a solution for folks who experience ADHD.

He went on to say that “it has been incredibly rewarding seeing this meaningful portion of our membership find a community of like-minded peers, find greater confidence, and grow a deeper belief in what they are capable of achieving.”

Personally, this is one of the things I appreciate most about Flow Club. It is a zero-judgement space and a supportive community that embraces individuality.

Final Business Startup Tips from Ricky Yean

Last, I asked Ricky to share his advice for entrepreneurs who are just starting out. So here in his own words are these final business startup tips:

1. Enjoy the journey

“You will inevitably face highs and lows, but if you are solving a problem that you and your users both care deeply about, this will help keep you grounded and motivated in the long run.”

2. Leverage the lessons

“Crowdbooster and Upbeat were both B2B solutions, so I’ve tried to carry the most relevant lessons from those experiences” to the journey of building Flow Club.

3. People matter

“The lessons that I think remain relevant across all contexts are the ones that are people-related, like continuing to work with David Tran; hiring a strong team; and maintaining a close relationship to our users.”

To learn more about Ricky and his experiences as a start-up founder, visit his site.

And try out Flow Club to gain all the benefits of this online co-working space. It’s really transformational for productivity and accountability. Learn all about body doubling here.

Business Startup Tips from Ricky Yean, Co-Founder of Flow Club Read More »

Big 3 regrets as an entrepreneur

Books & Resources, Operations, Reflections

Regrets.

It’s my personal philosophy to live a life without regrets. Which makes it a challenge to share here that yes, I have a few.

Especially as it relates to the service business franchise system I ran for 20 years. I started from zero in a corner of my basement and built it to a 7-figure system with 5 locations in 3 cities. But even with all that success, I can reflect now and see a few things I wish I’d done differently. No matter where you are in your business journey, avoid these big 3 regrets as an entrepreneur.

1. Underpaying myself

Show me the money.

Clearly, people get into business to make money. And my business did make money. My big regret is that I didn’t put more of it into my own pocket.

Sure, pushing profits back into a business is a smart strategy for growth.

And yes, paying competitive wages is important for building a strong team.

But how many times did I budget year-end bonuses for my management staff and employees, but skipped out on paying myself?

Most years, in fact. And why?

There is no simple answer for that. Actually, there is. Basically a matter of where my money mindset was at the time.

The point is, looking back now this is a big regret. Which may be one of the reasons why as a business coach I always talk about personal financial goals with my clients.

2. Working too much

How much is working too much? This is very subjective. For some people, a 50-60 hour work week is normal. And they thrive with it.

For others, working more than 4 days a week is too much.

For me, my regret is that I worked a schedule that left me little time for my own physical and mental health. My own wellness was not a priority. In fact, it wasn’t even on the list.

At the time, I was proud of myself for a strong work-life balance. Mompreneur magazine profiled me as an example of someone who was doing it all – raising daughters and building a successful business. And sure, I had the flexibility to be there when the school bus arrived in the afternoons.

But I also had the flexibility to work on the weekends, and to work after my kids went to sleep, deep into the early hours of the morning.

Most of the time, my schedule was packed with working on the business, managing my household, and looking after my daughters. There was very little time to look after my own self-care. Or to look after my marriage. And ultimately, I lost out because of it. So working too much may be my biggest regret as an entrepreneur.

After all, having control over the schedule is one of the many benefits of owning your own business. So build a strong boundary between life and work, and schedule time AWAY from the business. This will not just improve the quality of your own life and health – it will also prevent burnout and improve your productivity for the time you do spend on your business.

2. Working too much

How much is working too much? This is very subjective. For some people, a 50-60 hour work week is normal. And they thrive with it.

For others, working more than 4 days a week is too much.

For me, my regret is that I worked a schedule that left me little time for my own physical and mental health. My own wellness was not a priority. In fact, it wasn’t even on the list.

But I also had the flexibility to work on the weekends, and to work after my kids went to sleep, deep into the early hours of the morning.

3. Not working with a business coach

Yes, this seems obvious, and perhaps self-serving given that now I work as an entrepreneur coach. But it is BECAUSE of my experience as an entrepreneur that I’m so passionate about the value of coaching for small business owners.

I worked with a coach when I started my last business. I’d been in a cushy corporate job which sucked the soul out of me every time I entered that grey floor of stale cubicles. But building a new business felt overwhelming. On one hand, I had such a long list of action items that I didn’t know where to start. On the other hand, I was worried that I was missing something important.

Working with my business coach gave me structure and accountability. She validated my ideas. She gave me insight and advice which pushed my business forward by MONTHS. Her perspective and experience eliminated many operational and marketing mistakes which saved me time and money. The ROI was clear.

So why did I stop working with a business coach?

Maybe I felt that I’d learned enough from her. And that I could manage the rest on my own. Now, I see that a better choice would have been to find a coach that better fit for where me AND my business was at the time. Ongoing monthly coaching calls would have given me perspective and insight which could have prevented all sorts of hassles and issues in my business.

The irony is that if I had kept working with a business coach, I likely wouldn’t have the first 2 regrets. Because a good coach would have checked in that my personal financial goals were being met. And that I was taking the time to take care of me, not just my business and my children.

Guide for entrepreneurs to avoid regret

Each entrepreneur has their own individual set of goals and expectations for being in business. There is no one list that suits everyone. Use these big 3 regrets as an entrepreneur to inspire you to reflect on your values.

Overall, consider what you wanted to achieve when you first started your business. And not just lifestyle and income. Also think of how often you work, and what you spend your time working on. I recommend using the Vivid Vision process by Cameron Herold to develop a clear set of goals for what you want your business to feel like, look like, and act like.

Then, check in where you are now in your lifestyle, income, work schedule, and business. What doesn’t match up with that vivid vision? Use this to get clear about the gaps so you can make a list of changes to make.

Finally, when doing this review process, don’t dwell on any regrets that may come up. It’s easy to fall into that “should have” and “could have” thinking. However, what is past is past. Embrace the opportunity for change now. Remember the lesson of hagstones, and how small changes repeated over time have HUGE impact. Celebrate that you are being proactive now in doing the work to make your experience as an entrepreneur everything that you want it to be.

And of course, if you want structure and accountability to help you with this process, let’s connect to talk about it.

AVOID REGRET with this guide for entrepreneurs