When it comes to establishing the value of your business, one factor buyers consider may not be obvious to you – a diversified customer base.
Potential buyers are wary of a customer base that’s concentrated around one or two major customers.
They see it as a sign of instability and, in many cases, it ends up being a deal breaker.
When you diversify your customer base, it increases your ability to tap into new markets – this alone can greatly raise the value of your business when it’s time to sell.
A good rule of thumb is to never be in the position where any one customer generates more than 20% of your business.
To reduce the potential impact of losing a major customer, continue to expand your base with news sources of revenue.
The versatility in your customer base assures your business has the potential to grow more profitable in the years to come.
Next up: Selling Your Small Business –The Pitfalls Of Going It Alone.
