Field Notes
Reading customer concentration before you chase growth
If three buyers account for half your revenue, a growth plan that ignores them is a risk plan in disguise.
Growth conversations love new logos. Concentration conversations are less glamorous and more urgent.
When a handful of customers fund the payroll, every expansion idea competes with a quieter duty: protect and deepen those relationships — or deliberately diversify before you stretch. Neither path is automatically correct. Both require numbers on the table.
In diagnostic work we typically ask for:
- Revenue by customer for the last three years
- Gross margin by customer, not only by product line
- Contract terms and notice periods
- The named relationships that would break if one account manager left
Firms sometimes discover that their “growth problem” is actually a margin problem inside the top accounts: heavy service promises made years ago, never repriced. Fixing that can free more cash than a speculative new segment.
Other firms discover the opposite: they have under-invested in the mid-tier customers who could grow, because the largest accounts monopolise attention. In that case, expansion starts inside the existing book.
Either way, concentration analysis belongs at the front of strategic growth advisory — not as an appendix after the vision statement.