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Sometimes You Just Have to Say No to a Customer

Management
Article
04/26/2017

When dealing with a difficult customer, when and how should you say "No"? Successful businesses value their customers, but they also understand that not all customers are created equal. Difficult customers can cost you valuable time and money, drain you and your staff of finite resources, and in the end may not justify the effort involved in trying to make them happy. At the same time, it's often possible to say no, and not lose a customer's business entirely.

Difficult customers include those who:

  • Demonstrate a generalized interest in a business, but don't match up with the targeted demographic you're aiming for
  • Ask for products or services that significantly deviate from your core competency
  • Object to your need to raise prices upon occasion
  • Take up a great deal of time complaining about your offerings
  • Respond poorly to your staff's best attempts to satisfy them

Clearly, you don't want to get in the habit of saying no to customers. But when the need arises, here are suggestions to help ease the situation and maintain customer goodwill:

Be straightforward. In the event that you can't assist a customer, be straightforward in responding to their inquiries. Beating around the bush or stalling to buy time only makes a difficult situation worse.

Offer a helpful alternative. The best customer service involves offering an alternative to the word "no." Whenever possible, suggest another business or resource that can address the customer's specific issue or need. If this suggestion results in a favorable outcome, most customers will remember how you helped them satisfactorily.

Empathize. Soft people skills are nowhere as valuable as when a team member deals with a difficult customer by empathizing with their situation. This entails active listening skills (which are very useful even in positive interactions) which can help defuse a customer's frustration and make him or her feel they've been heard.

Another effective strategy is addressing what might prompt you to say "no" before ever having to do so. Keep in mind that the costs of acquiring new customers can be substantially higher than the expense of maintaining a loyal customer base. Honor and reward your best customers, even if this sometimes undercuts your new customer acquisition efforts. As long as a customer feels special, they're likely to stick around.

If prospective customers keep requesting services and benefits you've identified as too costly or labor-intensive to maintain, get rid of those services. Turn your focus to refining and upgrading what you do best, which will reduce occasions where the word "no" is involved.

What's most important is recognizing "the wrong customers for your business before their expectations absorb more of your limited resources than they contribute," says startup consultant Martin Zwilling. A far better strategy is always ensuring you can accommodate the customers who are most vital to your ongoing growth and success.

 

This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.
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