- “You’re Welcome” In standard
If you’re like most companies, at some point you’ve had a large customer that’s made up a majority of your income. We refer to them as giant clients. You know the ones– they send you a steady stream of orders, followed up with big fat checks. In the back of your head you know you’ve got all your eggs in one basket. And someday that basket is going to tip over. It’s hard to think about that when you are so consumed in the day-to-day delivery and service.
And then the basket tips over and all the egg spill out. If your primary clients were concentrated in the financial services industry anytime in the past few years, you know what I mean.
The basket tipping over may be the result of any number of factors: the economy, a change of leadership, a buyer changes companies, new regulations or any number of factors. But when it happens, it could be devastating for you and your company.
So before that day comes, it’s a good idea to start diversifying your portfolio of customers—adding more and possibly in different industries. Easier said than done, right? You’ll need to get creative and take another view of your service or product.
Here are a couple ways you can think creatively:
Repurpose. Maybe you’ve developed a proprietary workflow, streamlined your processes or aggregated enough information to put together a database that is worthwhile. Can you use it for a different application? Who outside your current target market might find those one or two pieces useful?
Resell. Maybe there is a large competitor in your market that provides similar products or service to yours. Maybe they want access to the niche that you serve but can’t with their infrastructure and costs. Re-selling your product to them may give you greater access to your market and economies of scale.
Rebundle. Maybe you have a specific market you sell to, say large companies, however your product or service may benefit consumers or smaller businesses. Can you pare back some of your offerings to serve clients with smaller budgets? Maybe they don’t need all the bells and whistles you offer now, and while you might get a lower “ring” per sale you might find them quite profitable.
Reframe. Take a look at your product or service and look at it really objectively. Break down each step in providing your service or in your manufacturing process. What other markets might benefit from what you sell? Think about Cirque D’ Soliel– they took “circus” to a whole new and different level.
Serving giant clients can be a love-hate relationship. You love the steady cash flow they provide but you hate what will happen to you and your company when they leave.
No one wants to think about the cutbacks that would happen if the giant clients decreased their orders from you. The best way to protect yourself for that day—and it is inevitable– is to be prepared. Diversify your client base.