Total Click Solutions

Tag: deal-making

  • When to Walk Away From a Deal

    When to Walk Away From a Deal

    The pressure to close a deal has a way of warping your judgement. You’ve spent weeks in calls, exchanged dozens of emails, maybe even flown somewhere for a meeting, and now the thing that matters most is getting it done rather than whether it’s actually any good. That slow drift from evaluating a deal to just finishing it is how most bad agreements get signed.

    Knowing when to walk away isn’t a failure of persistence. It’s one of the most disciplined things you can do in business development, and it’s considerably rarer than it should be.

    The sunk cost problem

    The hardest part isn’t spotting a bad deal. It’s spotting one after you’ve already invested three months in it. Research from Kristina Diekmann at the University of Utah found that what a seller originally paid for something distorts both parties’ expectations in a negotiation, even when that original price has no bearing on the asset’s current value. The same logic applies to time: the six weeks you spent on a partnership proposal don’t make the partnership any better, but they absolutely make you less willing to abandon it.

    Harvard’s Programme on Negotiation makes the point plainly: what’s already spent is gone. Your BATNA, your best alternative to a negotiated agreement, should be weighed against what comes next, not what you’ve already put in. If you don’t have one before you sit down to negotiate, you’re essentially negotiating from hope rather than position, and the other party can usually sense it.

    Signals worth taking seriously

    A counterparty that keeps reverting to initial terms after you’ve agreed to move past them isn’t forgetful. They’re most likely testing how much you’ll absorb rather than genuinely trying to find workable ground. Slow responses and withheld information don’t typically improve once you’re actually working together.

    Terms that chip away at your margins in ways that feel small at first are worth adding up properly. A pricing structure that feels borderline acceptable on day one has a habit of becoming genuinely painful by month six, particularly if the deal ties up resource that could go elsewhere. The question isn’t whether you can tolerate the terms today; it’s whether you’d design them this way if you were starting from scratch.

    Desperation on your side is also a signal, even if it’s an uncomfortable one to notice. Deals made under revenue pressure tend to attract onerous conditions, because the other party can usually tell you need it more than they do. If you find yourself arguing yourself into a deal rather than being genuinely convinced by it, that’s worth pausing on.

    What walking away actually looks like

    It doesn’t have to be dramatic. Being clear about your reasons, keeping the door open, and staying professional costs nothing and occasionally results in better terms coming back the other way once the other party realises you meant it. Burning bridges over a deal you turned down is just a waste.

    The practical discipline is to define your walk-away point before negotiations begin, not during them. When you’re in the room and the pressure is on, your sense of what’s acceptable shifts in ways you don’t always notice. A written note to yourself about minimum acceptable terms, made before any conversation starts, is a genuinely useful thing. It doesn’t need to be a sophisticated document. It just needs to exist.

    And every deal that isn’t right for you is time and attention that isn’t going to one that is. That’s the real cost of staying too long at a table that isn’t working.

  • The Opportunity Cost of Saying Yes Too Often

    The Opportunity Cost of Saying Yes Too Often

    The sunk-cost trap

    Saying yes to every deal that crosses your desk feels productive, even virtuous, because at least something is happening. But filling your calendar with the wrong clients and half-fitted projects is one of the quieter ways businesses stall. The cost never shows up as a single line item. It disperses across missed deadlines, drained teams, and the good opportunities you didn’t have bandwidth to pursue.

    A lot of bad yes-decisions aren’t made at the beginning of a deal; they’re made somewhere in the middle, when you’ve already spent three weeks in conversations and it feels wasteful to stop. That’s the sunk-cost fallacy at work, and it’s remarkably easy to dress it up as professionalism. “We’ve come this far” is rarely a business reason. It’s just reluctance wearing a suit.

    The same logic applies to clients who are already onboard. If someone is costing you more in management time, emotional energy, and team goodwill than they’re generating in margin, that’s a loss, even if the invoice looks fine on paper. A busy pipeline full of low-fit work is not momentum; it’s drag.

    What a bad fit actually looks like

    It’s rarely obvious at the start. The clearest signals tend to be:

    • The scope of what they need sits well outside what you actually do well, and you’d be building something custom you’ll never use again.
    • The margin is thin enough that one revision round or a delayed payment turns the job into a net negative.
    • You find yourself hesitating during negotiation, not because of nerves, but because something about the terms doesn’t sit right and you can’t quite name it.
    • Every answer they need from you is urgent, but every decision on their side takes weeks.

    That last one deserves particular attention. A prospect who creates constant urgency on your side whilst moving slowly on theirs is telling you quite a lot about how the relationship will feel at month six.

    The real price of saying yes too often

    The opportunity cost is straightforward: you’ve already spent the capacity you’d need to pursue something better. When a genuinely good brief arrives, a well-aligned client with realistic timelines and a budget that reflects what the work is worth, you may not have the resource to take it on properly. So you either squeeze it in and deliver something mediocre, or you pass.

    There’s also a quieter cost to your team. Difficult, low-margin, or poorly scoped work tends to be experienced most sharply by the people actually doing it, and that accumulates into the kind of low-level exhaustion that’s hard to diagnose until someone hands in their notice.

    Getting comfortable walking away

    The practical version of this isn’t a complex framework. It’s mostly about deciding, before a conversation starts, what your actual non-negotiables are: minimum margin, the kind of scope you can genuinely deliver on, payment terms you can work with. Once you have those written down somewhere real rather than kept as a vague feeling, declining becomes significantly less fraught, because you’re not making a judgement call in the moment, you’re just checking against criteria you’ve already agreed with yourself.

    Turning something down clearly and quickly is also, counterintuitively, good for the relationship. A prompt and honest “this isn’t the right fit for us” is far less damaging than stringing someone along for a month before the whole thing collapses. People remember how you handled a no far longer than the no itself.

    The businesses that grow well tend to be choosy in a way that looks almost reckless from the outside. They decline things. They finish conversations early. And they have the capacity, when something genuinely good appears, to pursue it properly.