A lush forest can turn to ash. Sadly, I’ve seen devastation too many times when one or a handful of startup clients yield the majority of profits.
Expanding clients lowers overall risk and sprouts other advantages:
𝗟𝗲𝗮𝗿𝗻𝗶𝗻𝗴 – Gain unexpected insights across the company.
𝗨𝗽𝘀𝗲𝗹𝗹𝘀 – Offer something fresh to existing clients.
𝗘𝗺𝗽𝗹𝗼𝘆𝗲𝗲 𝗗𝗲𝘃𝗲𝗹𝗼𝗽𝗺𝗲𝗻𝘁 – Keep roles growing with new offerings.
However, there are potential costs to revenue diversification:
𝗖𝗼𝘀𝘁 𝗼𝗳 𝗥𝗲𝘀𝗼𝘂𝗿𝗰𝗲𝘀 – Add expenses from new processes and teams.
𝗟𝗮𝗰𝗸 𝗼𝗳 𝗙𝗼𝗰𝘂𝘀 – Spread attention could lead to inefficiency.
𝗖𝗼𝗺𝗽𝗹𝗲𝘅𝗶𝘁𝘆 – Challenge your communications to existing clients.
How can you get the best ROI with an expansion initiative?
𝗦𝗲𝘁 𝗟𝗶𝗺𝗶𝘁𝘀 – Focus on a highly specific segment until you demonstrate success.
𝗖𝗵𝗲𝗰𝗸 𝗗𝗮𝘁𝗮 – Check progress and adjust the campaign on a regular basis.
𝗟𝗼𝗼𝗸 𝗢𝘂𝘁𝘀𝗶𝗱𝗲 – Rely on external resources for creation and implementation then scale once you get traction.
No customer should represent more than 15% of revenues, ideally much lower. Revenue diversity is complicated, but the risk is fatal.
Photo by Ylvers who can be found here: https://bit.ly/3bJHxE8