Be prepared. Always be prepared. Be prepared to have significant changes made to your business overnight. The loss of a major customer. The loss of a major contract. If your business depends heavily on one or two customers or contracts you may be exposing yourself to unnecessary business risk.
Having a large customer is great. The ease of which your business can operate and function makes serving a single (or few) customer worry-free. Like everything in life there are trade-offs. Serving a few customers may be easier for your business but also puts it at risk. Serving many customers may burden your business however if any of them stop doing business with you the disruption to revenue is minimal. So how do you know what the right balance is? The answer is unique to each business but the principle is not. As an entrepreneur you want stability in your business and one of the ways to do that is to make sure you have a good mix of customers and sources of revenue. Spending time ensuring your revenue is diversified will save you time in the future because you won’t need to react to any major customers or contracts disappearing.
Amazon has told its third party vendors (which make up more than 50% of the products sold on Amazon) that they are banned from using FedEx ground delivery services for Prime customers. The ban is in effect until the performance of FedEx’s ground delivery services improves. Both FedEx and UPS have reported that they are struggling to keep up with shipments due to weather delays and higher than expected shipping volumes. This move by Amazon will certainly impact the revenues of FedEx.
Take a moment to consider how diversified your revenue is. Does a disproportionate amount of revenue come from a few customers or contracts? If so, what risk does this pose to your business and what can you do to diversify your customer/revenue base?