Assessing Business Value: Customers, Diversification, Differentiation

Developing a diverse, attractive list of customers is something all businesses should manage toward.   An example of a valuable customer list is one that contains a handful of long standing, blue chip industry leaders that have been served for many years.  While the price of products and services is always important, business value is enhanced when companies have a demonstrated track record of conducting business with customers that recognize that the total value of products and services is more than simply a price.

Surprisingly, I have found that it is not uncommon for companies to allow themselves to become overly dependent or concentrated on one or just a couple of customers.  The obvious risk is losing just one customer creates a financial burden for the whole business.  A customer concentration is magnified when the relationship is based on price rather than some other form of differentiation.  Examples being innovative products, unique expertise and or exceptional service.

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