Many small businesses have one or two large clients that make up a significant portion, 20% or more, of their revenue. Anyone will tell you that's a risk. Few take it seriously. You have to.
"It's a good problem to have!"
It's really not. Let me tell you what happens if you lose that client, because I've lived it. You start by laying off 20% of your technical staff. Then you lay off 10% more to trim overhead. You restructure processes, consolidate departments, drop the vendors you can and renegotiate with the ones you can't, sell equipment, renegotiate with creditors and your bank because you're suddenly over-leveraged, and get a smaller office. Every area of the business gets scrutinized. Profit becomes a distant memory, and so does your personal income.
"But they're happy, they aren't going to leave!"
Businesses go under. They have downturns. They get acquired. More likely, they get a new executive with different ideas, and suddenly your champion isn't just gone, they're pushing for someone else. Clients can evaporate overnight. It happens all the time.
So what can you do? Your only real option is to sell your way out of the problem, and that can take years. In the meantime, two things.
First, keep the issue at the top of your risk list. It should factor into any major decision you make. It should also be on the agenda at every quarterly leadership meeting, tracked alongside your goals.
Second, have a plan. Map out, in detail, exactly what you'll do if it happens. Not just how many people have to go, either. I want you to write down their names. Figure out the financial impact, how long it's going to take to turn around, all of the details. This is a disaster recovery plan. The bonus: building the plan will scare you enough to actually fix it.