1 Minute Business Gyan – Day 1
Why Too Much Dependence on One Customer Is Dangerous
Let me share a true story. It’s one I’ve come across many times in my career.
There was a textile manufacturer in Delhi. They were Hardworking people, products of great quality. Their biggest win? Orders came like clockwork. Payments were prompt. Business was booming. A large export client who regularly placed bulk orders. No delays. No drama.
But there was a catch. 80% of their sales came from this one client.
Then, one day, the unexpected happened: That client shifted their supply chain to some other Supplier. No call. No notice. He was just gone.
What followed?
- Staff salaries got delayed
- Loans and EMIs bounced
- Unsold inventory piled up
- Their OD limit hit the ceiling
- And soon, the account turned NPA (Non-Performing Asset)
Their entire business was running on trust in one customer. And that trust vanished overnight.
The Real Risk: Dependency
Here’s the truth most MSMEs realize too late: If one client makes up most of your income, you don’t own a business, You’re just running a project for someone else.
In banking, we call it client concentration risk. It’s a red flag even if your revenue is high and books look good. Because one sudden decision from that client and your entire business can collapse.
Today’s Business Gyan
Here’s what smart, stable MSMEs do differently:
- Limit client exposure: No single customer should make up more than 40–50% of your total sales.
- Keep marketing alive: Even during your busiest periods, never stop finding, meeting, and nurturing new clients.
- Play the ‘What If’ game: Ask yourself right now: What if my biggest client leaves tomorrow? If the answer scares you, it’s time to build a plan.
- Maintain Healthy Liquidity: Don’t run your business too close to the edge. Build cash reserves or access to emergency credit.
From My Desk as a Credit Officer
I’ve assessed over 1,000 MSME loan applications. And I’ll tell you this that the strongest businesses are NOT the ones with the highest turnover.
They’re the ones with:
- Multiple stable income sources
- Reliable cash flow
- Customers spread across sectors, geographies, and sizes
- Invest in relationships, not just revenue.
Even small steps like onboarding 2–3 consistent, smaller clients instead of leaning on one “big fish” can save your business in tough times.
Today’s Thought
Losing one client should never mean losing your entire business.
So take a moment today to ask yourself: Am I building for today’s profit or tomorrow’s survival?
Don’t just grow, grow strong. Build resilience. Build options. Build smart.
Save this post if you’re an MSME founder or consultant.
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