If you were to segment your business, what percentages would follow key characteristics such as:
- Number of companies
- Company size
- Spend with your company
- Geographic location
- Specific solution your company offers
Now apply business, economic and other trends that are impacting your customer base. What does the information start to tell you? Are you too reliant on, for example, companies of a certain size or industry?
What do you do next? Here are some easy ways to test for potential growth and ideas on spreading your risk.
Test # 1 – More opportunities in current customers?
Create a grid something like the one below with your customers on one axis and solutions you offer on another. Start with your top 5 or 10 customers. No need to make this fancy. In about 30 minutes or less you will have a view on the depth of relationships with these customers.
One of two things should happen next:
- Blank boxes reveal potential opportunities to pursue and mitigate risk near term
- Most boxes are filled in and your company is the dominant provider in each case. This should get you thinking about new solutions your company could offer these customers.
Test # 2 – What if (fill in the blank) disappears?
This is another quick test that should get your creative thinking going and reveal how resilient your customer base is. Some questions to consider:
- What if your largest customer disappears (e.g. because of competitor, business trends)?
- What happens if the industry most of your customers are in has a significant downturn (an unfortunately common question recently)?
- What if a highly valuable resource leaves your organization and goes to work for your customer or a competitor?
Proceeding from here
If you find there is significant growth potential in current customers or find you are too reliant on one customer, the key next step is to understand what your customers most significant challenges are. This will reveal what current solutions you can offer or lead you to what new solutions your company should develop. Either way, you will learn a lot and be better positioned to improve the resilience of your customer base.
Feel free to contact me directly for ideas and/or help on this or other topics!
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