I find a key to managing your niche is tracking how often you say no to potential customers. If you’re not saying no a significant amount of the time you don’t have a niche. You might have a market segment that you work with but you don’t have a niche.
Those who have truly developed a niche find that they will often say, “I’m not the right fit for you”. There is nothing wrong with saying this. I would say it’s one of the more healthy things you can say to someone who is considering working with you but just not one who fits as a customer you can tremendous value for.
Saying no takes a lot of guts. To say no you have to believe that there are people you are going to say yes to. We all need customers. I maintain that it’s not just getting customers but getting the right customers that make a business successful.
We all know about the 80/20 rule where 80% of our profits come from 20% of our customers. I’ve always wondered why it is that businesses just don’t say no to the 80%. My belief is we don’t say no because we’re afraid there aren’t enough that we will say yes to.
Saying yes requires examination of who to say yes to. Before you can say yes or no to a customer you need to examine specifically whom you want to say yes to. This means you must be very specific about who the customer is that you will have the most success with.
Once you’ve developed the criteria of who is the best type of person to work with you can then let others in your organization know what your criteria is. Now comes the hard part; you need to make sure that others only say yes to those customers who you can serve the best.
Saying no creates capacity. It never fails, every time I see a company start saying no, customers show up who are the right customers. When you spend lots of time serving customers that don’t fit you’ve taken capacity that could be filled with the perfect customer.
It all comes down to making sure that you’ve developed a clear understanding of who to say yes to. The next step is having the discipline to say no and say it a fair amount. In my experience those who have taken the time to say no greatly benefit from the discipline that no requires.
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