A small business owner might be tempted to turn into a "yes machine," where every answer ends in the affirmative. Saying yes may seem like the appropriate response for a number of situations, but there are actually times when a small business just has to say no instead.
While a financial plan might benefit from a go-getting attitude, always saying yes has the potential to lead a company into fiscal trouble, and being business savvy often means picking the correct opportunities to invest, pitch and unveil a product. In some cases, a firm no might even help a venture make more money than a yes would have.
Pick the right time to act
A small business owner has to pick his or her spots, and that extends into every aspect of the company. Diving into all opportunities increases the chances of failure and wasted money, and having the proper infrastructure in place before moving forward is critical for success. Financial tips might be pointless if business acumen is sorely lacking.
Therefore, only say yes when it is the perfect time to do so, and say no when it just won't work, according to Inc. magazine. While there is usually potential in most business strategies, sometimes the downside outweighs the positives.
Time is the most precious commodity for a small business, and wasting it on aspects that will never amount to anything might do significant harm. That extends to the hiring process, investment opportunities and partnerships. While management should look at the reasons why something might work in the end, overlooking the reasons it could fail is a grievous error.
Don't take on too much at once
Additionally, it might be the wrong time for a small business to take on more work. That is when "no" can be invaluable. Reaching full capacity is something easily achievable for smaller companies, and not being able to admit it can wreak havoc, according to Forbes.
Financial services can help streamline processes, but eventually a company needs to focus on the task at hand, instead of looking toward the future. Honesty is still a great policy, and a manager should talk to prospective clients and explain that now might not be the best time. Frequently, people are understanding, and that might result in a happier customer later, when saying yes is an option again.
If a prospect wants to work with the small business, they typically won't mind waiting, Forbes noted. Being upfront early will reduce the likelihood that a venture delivers a bad product.
Sometimes "no" equals more money
While the affirmative might feel like the only way to grow a small business, saying no every once in a while might provide a boost to a company's financial plan.
Moreover, waiting for the perfect business opportunity might mean turning away a line of other prospects, according to Erika Napoletano, contributor to the American Express OPEN forum. More work doesn't necessarily result in more money, and finding the right moment to strike requires patience.
In addition, a small business' marketing strategy might actually attract the wrong people, explained Napoletano. If this is the case, an owner can reduce the amount of time spent saying no by changing a website or advertising to better appeal to the right set of companies and customers.
Small business owners might want to remember an important fact – profit isn't always defined by more money, according to Inc. magazine. Strong financial tips include growing connections and visibility, not just the bottom line.
A management team can improve a venture by learning when to say no. A healthy balance between unbridled optimism and extreme caution is required, but picking the right spots to act will quickly result in a small business experiencing financial growth.