Not All Business is Good Business

Running your own business can be frightening. For many businesses, there’s a natural ebb and flow to sales or even some sort of seasonality. In the consulting world, the fear of no new customers or losing existing customers can push a business owner to take on the wrong kind of business or make bad decisions.

For a number of year years now—thanks to my father-in-law—I’ve appreciated Alan Weis’ perspectives on consulting. His recent post on this topic really resonated with me:

Some potential business is too small, too remote, too laborious, too demanding, too ridiculous. Some of it is unethical or repulsive. Eschew it.

Pursue that business which you are great at and love doing, provided by your ideal buyers. It’s as simple as that.

One might be tempted to think that being able to “choose a customer” is only applicable when business is booming. It’s that type of thinking that can get you into trouble.

There’s an opportunity cost to taking on the wrong customer. The biggest one being that when the right customer comes along, there’s a higher likelihood that you won’t be available to work with them.

My experience also dictates that the “wrong” customer is usually wrong for three reasons, not just one. For example, it’s likely not just about the customer being demanding. It’s that the customer is demanding, the budget too small, and the timeline too tight.

At savvy apps, we look at potential customers through three lenses:

  1. Do we believe in and like the idea?
    Is this app something we would use? Is it focused enough? Can it continue to evolve?
  2. Do we believe in the people and the team?
    Are they proven? Do they have key advisors and industry contacts? Would we enjoy working with them?
  3. What do we see as the long-term potential for the relationship?
    What happens after v1.0 ships? Will this customer make referrals? Will there be new work outside of this app?

Even during slow times, we’ve turned down business that did not align with one of these kinds of tests. While turning down money is a difficult choice, I know that the right customer will motivate us to produce award-winning work and keep our attrition extremely low.