Winning one huge contract can feel like the perfect solution, but sustainable businesses often need to think about diversification alongside growth, rather than depending on a single relationship.
Frequently Asked Questions
What is customer concentration?
It is the degree to which a business depends on a small number of customers for its revenue.
Is having one large customer always bad?
No — it can be commercially valuable, but excessive dependence creates risk.
How can a business reduce concentration risk?
By gradually developing additional customers and revenue channels over time.