How to Say “No” Without Losing the Customer

Turning down client requests doesn’t have to cost you their business, if you do it right. Four steps to keeping them happy without doing something you don’t want to

Written by Catherine McIntyre

Gino Coutu has no qualms about turning down requests from the people that pay him. The CEO of D2C Media, a Montreal-based web agency that helps car dealerships improve their online presence, regularly hears from clients who want the company to expand its offerings. “It’s not what customers want to hear: €˜No I don’t want to go there,'” says Coutu. “But it’s something that I’ve learned very early, to say no.”

Startups and growing companies are under constant pressure to satisfy current and prospective clients. But catering to their every whim can set your business back rather than improve loyalty or build your customer base. “The longer you can stick with one vertical, the faster you can grow your business,” says Coutu. For him, that’s meant getting comfortable saying, “Thanks, but no thanks,” to customer requests.

So far, the strategy has paid off: Coutu’s dogged focus helped his business grow 412% between 2010 and 2015, and earn the No. 162 spot on the 2016 PROFIT 500 Ranking of Canada’s Fastest-Growing Companies.

Of course, saying €˜No’ comes with its risks—valuable customer might feel slighted by your refusal, and take away their business. Here are four tips on turning down client requests in the interest of growing your business.

1. Define the customer

Julie Mitchell, founder and partner of Parcel Design, spent the first nine years of the business chasing down every opportunity that came up. “We were trying to prove our capabilities,” she says. “We didn’t specifically define who our clients [were] and the kind of work that we wanted to do for them.”

The result was a lot of time wasted pursuing clients that weren’t compatible with Parcel’s core mandate, providing businesses with brand strategy and communication design services. Finally, Mitchell and her partners decided enough was enough. They stopped going after clients that weren’t convinced Design Parcel was a fit for them—”It’s not a healthy partnership if you’re always trying to prove your worth”—and only met with buyers that showed their commitment. It’s paid off—Parcel grew revenues 89% from 2010 to 2015, and placed No. 455 on the 2016 PROFIT 500.

“The most critical question is always: Is there a budget for this project? It’s not a viable project if it hasn’t been earmarked for spending,” says Mitchell. “That’s a key filtering question and a reason we’d say €˜No’ rather than try to further the relationship.”

2. Genuinely consider the request

Customers want to know that they’re being heard. Listening makes clients feel valued, which bolsters loyalty, and can also improve your product or service. “Your ears need to be always open,” says Dafne Orbach, president of NicheMktg, a business strategy consulting firm. “You have to listen to the clients because they know what they need. But you know what your business needs, as well, so you have to be smart.”

Orbach suggests digging into intriguing requests by consulting other clients and companies in the field to determine if there is in fact an opportunity worth pursuing.

When Coutu gets a request from a client, he always asks: “Will that help dealers sell more cars online?” “If the answer is €˜Yes,’ then it’s something I should consider,” he says. “Otherwise, it’s a distraction from us being the number one player in our vertical.”

3. Explain why you’re saying €˜No’

“Every day I get people proposing that I branch out,” says Coutu. “Clients see that you’re already there selling them a website—why not sell them a phone system, too? It’s not that simple, and you have to explain that.”

Every time Coutu says no, he reiterates to his clients what his company’s strength is—software that helps dealers sell cars—and that if D2C loses sight of that mandate, the quality of its service could suffer. “It’s actually a service to your client, when you tell them, €˜I’m going to continue being the best provider on the left, and there are other great partners on the right side,” says Coutu. “They typically understand.”

4. Suggest someone who can say €˜Yes’

Both Coutu and Mitchell agree that leaving a client or prospective client in the lurch is bad for business. That’s why when they say €˜No’ to an opportunity, they quickly follow up by recommending a company that can meet their needs. “If I feel like they need a different type of partner, then I always try to help them resource that, whether it’s making an introduction or pointing them in the right direction,” says Mitchell. “That leaves the relationship in a nice place.”

The result is that that customers feel more compelled to work with Mitchell on future projects that are better suited to her services. In one case, a prospective client did come back three months after Mitchell gracefully rejected their business, and Parcel Design ended up working with them on a rebrand. “It’s also just tough when you’re trying to find the right partner,” she says. “If I’m an insider in the industry, I’m happy to provide that advice.”


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