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“We’ve been saying no to Fortune 500 companies,” Tim Bergler of Percipio Group Consulting said during an expert panel session with 50 entrepreneurs in attendance. Mr. Bergler was sharing one of the pieces of advice he gives to new entrepreneurs at his EO accelerator program in Portland, Oregon. “If you can’t do a customer’s job perfectly, don’t be afraid to say no,” he continued. His answer shocked me.
Recognize the power of “no”
When I think about the most successful entrepreneurs I know, I realize that they say no to most “opportunities.” When I looked back at my company, I realized that our greatest success came after we became clear about what we wouldn’t do.
The most important problem is that most people say “yes” too much. When starting a business, you primarily think about what you do. That’s pretty much everything you do to grow a company. So, say yes to everything and focus on getting as many sales as possible. And while that may work in the short term while you’re small, it doesn’t work in the long term and may even make you smaller.
This is because resources are finite for a growing company and can easily be wasted. It’s important to say “no.” By doing so, you can focus your limited resources – people, time, and money – on the core elements that will best drive success.
RELATED: Stop Tormenting Yourself to Say “Yes” Too Much — Here’s How to Harness the Power of a Simple “No”
Create a “don’t do” list
Although it feels counterintuitive, the most important questions to ask are: I don’t Gather your team and create a thorough “don’t do” list. Think about it and commit to the outcome. Notice how this exercise focuses and drives your company forward.
Successful companies focus on providing only what customers need: products and services that are hard to find elsewhere. Think about all the businesses you love. Are they doing everything for everyone, or are they doing one thing very well?
Consider the grocery business. A standard grocery store sells an incredible range of foods in a low-margin, highly competitive field. Compare this to Costco or Trader Joe’s, which have high margins and focus on what sells and what doesn’t. We carry only high value-added items that cannot be found elsewhere. Top food companies like McDonald’s, Starbucks, Dunkin’, Chick-fil-A, and Taco Bell all have powerful “don’ts” lists.
A recent headline mentioned that “the most important stock on the planet” rose from obscurity to a $2 trillion valuation thanks to a “don’t do” list. That company, Nvidia, is developing the technology that enables his AI. Nothing else.
Related: To stay focused as an entrepreneur, you need to choose your opportunities wisely
Effects of strategic omission
I failed at creating a “don’t do” list at my first company, especially a product business that wasn’t successful.
The second time around, my self-storage business became even more focused. We bought our biggest competitors: Public Storage, Extra Space Storage, and CubeSmart. Therefore, in order to differentiate ourselves from other companies, we thoroughly thought about what we could offer that other companies did not have.
We’ve compiled a comprehensive list detailing what we don’t like about these companies. This list inspired the following “don’ts” list:
- Prices change daily
- Upsell or push additional products/services
- Save on hidden moving costs
- Route calls via call center
- act as if the customer is bothered
- compulsory insurance
- Become a national company
- Put the customer in a space that isn’t right for them
The list is simple but magical. It does four notable things.
- Decide what to do. Deciding what you don’t like and what you won’t do is a hack for identifying what you do, and it’s basically the opposite. Establishing a “don’t” list creates a clear and moving answer about what you will be to your customers.
- It’s the ultimate time saver. Eliminating the things you don’t do creates space to focus on the things you do, strengthening your offering.
- Simplify decision making. Decisions are either on-brand or off-brand. It’s obvious when you look at the list.
- Make your brand clear In a way that is not possible any other way. The more you know what you’re doing, the more successful and profitable your company will be. You are offering something unique that is not a product.
A “don’t do” list is an important business tool. It not only limits the scope of your business but also helps shape the way your business operates. Things like business practices, pricing structures, and how customers are treated. Plumbing companies may opt out of electrical work, but they also exclude practices like overcharging, forcing upgrades, and setting half-day appointment slots. After all, a “to-do” list can help you focus more efficiently and narrow your field.
Related: How to say “no” more often: Why every entrepreneur needs a “to-do” list
Set boundaries and focus on business
Let’s go back to Mr. Bergler. Mr. Bergler ran a management consulting firm with a narrow focus area where he could add significant value. He was as selective about the quality of the people on his team as he was about the type of business they did. They were in high demand because of the high quality of the work they produced. Eventually, incoming job opportunities exceeded capacity. He turned down many deals and even referred his clients to competitors when he felt his own company couldn’t really succeed.
As a result, clients first started approaching Burgler due to substandard competitors and many mistakes. This has made Bergler the preferred provider for our best customers. When he chose to sell the business, multiple buyers were confident of the company’s lasting income due to the company’s 20 years of consistent performance and extremely high customer satisfaction.
We quickly achieved a lot of success with our self-storage company. Our differentiated brand made us a customer favorite, earned us a higher reputation than larger companies, and ultimately made us an excellent acquisition candidate when we chose to sell.
When we started a new company focused on vehicle storage, one of the first things we did was research our competitors and brainstorm a “don’t” list.
When I think about the many businesses I’ve known over my 20 years in the entrepreneurial community, I can tell you that there is a strong correlation between success and adhering to a strong “don’t” list. Do yourself a favor. Create your “don’t want to do” list now.
