You are working 60-hour weeks, your small team is overloaded, yet your revenue is hitting new highs. So why do you feel as if you’re still just breaking even? For a designer, every “yes” to a mid-level, high-maintenance project is a “no” to a high-value, career-defining project. Opportunity cost is a fundamental concept in economics, representing the trade-off that is involved in every choice. Opportunity cost is the loss of an opportunity and potential gain from other possibilities when one alternative is chosen over another. It underlines the fact that resources are limited and decisions have consequences. Every decision involves a cost and a sacrifice. In this article, we’ll show you how to say no to design clients to preserve your sanity and capacity.
The Scarcity Mindset vs. The CEO Mindset
Fear of scarcity is a common trap designers fall into. There is a fear that if you don’t take this $40k kitchen remodel, the phone will stop ringing.
When your thoughts start to move toward scarcity, remind yourself that your firm has finite resources―in team hours, and mental bandwidth.
You need to ask yourself if the job is the best use of those resources. Is it really a good fit? And, of course, always evaluate if it is an ideal client. Shift your thinking from “I need the work” to “Can I survive the work?”
The Math of a Small Project
There is an important reality that many designers forget or willfully ignore. The truth is that a small project often requires the same amount of administrative hand-holding, procurement tracking, and fire-fighting as a large one. Think about it this way: A certain amount of work is necessary to start and maintain a project, regardless of size. The larger a project is, the more those fixed costs can be distributed. On a small project, those costs hurt more.
The design process is basically the same for a large project as a small project, but the return on your investment of resources is generally greater on a larger project. As an example:
- Project A is a $50k project with 20% net profit = $10k.
- Project B is a $500k project with 20% net profit = $100k.
If Project A takes up 50% of your team’s time, you have just spent $50,000 of potential profit (Project B) to earn $10,000. Is Project A really the best use of your firm’s resources? If you are caught in the scarcity mindset, you may take Project A, then not have enough resources to accept Project B.
How Small Projects Hurt the Business
Moving from a design hobbyist to a true powerhouse in the industry requires not getting tangled up in the weeds. It means you have a team, including a dedicated Project Manager. One of the problems with small projects is that they often lack the budget for a dedicated Project Manager. That creates the bottleneck by forcing the Principal to focus on the small things.
When the Principal chooses the tile for a guest bathroom, they are not building the relationship-driven networks that lead to strong brands. Building those networks is what helps to fight the scarcity mindset, as you are constantly filling your pipeline with ideal clients. You can’t afford to be caught in the weeds. Your job is to be out marketing and building your business, making high-level decisions that your team can execute on. You need to learn how to say no to design clients who present small projects that will only end up distracting you from bigger fish.
Here’s the simple solution. Before accepting a project, ask yourself if it will allow you to stay in your Zone of Genius. If not, you can’t afford what that project will cost you mentally.
Creating Strategic White Space
Having empty space on the calendar is not necessarily a negative. It does, though, involve strategies to overcome the fear. Be ready to do some proactive marketing. That might be reaching out to past clients or attending a networking event. It can also involve time management. Fill some of the white space with structured planning to balance current projects while being available to seek new opportunities. And an important key is a mindset shift. Reframe the idea of an empty calendar as an opportunity to focus on your business.
Use that open time on the calendar to focus on how your business operates and what might be improved. That may involve a tech audit, or leadership planning, or possibly succession planning. Be prepared for those empty spaces on your calendar and look at them as a gift. Working on your business means your firm will be even more prepared to take on the additional business generated by your increased marketing.
The power of attraction is just that―powerful. Just as you market effectively to ideal clients by understanding who they are, the same holds true for moving from a hobbyist dabbler to a design powerhouse. By understanding the needs and values of your ideal clients, you can align your energy and messaging to attract them. Like attracts like. So with that in mind, understand that if your portfolio and social media are filled with dabbler-tier content because that’s all you have time for, that’s who you will keep attracting. Tailor your marketing to the people you want to reach.
How to Say No to Design Clients with Care
Many designers don’t know how to say no to design clients. But saying “no” to a project is much easier if you have an alternative to offer those clients. Build a network of trusted peer resources to whom you can send non-ideal clients. By doing this, you still build goodwill in your community, without taking on a job that’s bad for your business.
Develop a referral script that is comfortable for you. It should be honest but offer the prospective clients a positive solution. For example: “We aren’t the right fit for this scope, but I’d love to introduce you to a colleague who specializes in exactly this.” This avoids the trap of saying you are too busy and having them say, “Oh, that’s fine, we’ll wait”.
The result is positive for both sides. You have offered a referral to a firm that will better meet their needs while protecting your firm’s energy and maintaining your status as an expert in the industry. And by passing on your non-ideal project to a different design firm, you’re not “helping the competition” or otherwise losing out―you wouldn’t have taken that client anyway!
You cannot build a top-tier firm with a hobbyist mindset. In other words, you cannot build a $5M firm with a $50k-project mindset. Be clear about where you see the future of your firm. Keep that vision in mind and project that to your team. They also need to adopt that mindset.
Now it’s time for action. Start by reviewing your current project list. Identify any small, hobby-level projects that are preventing you from finding your next major project. In addition, keep working on your mindset to become comfortable with becoming a true CEO.