As you conduct your small business day-to-day, you start to have one or two customers provide more and more work for you. Initially, you are excited at the prospect. Who wouldn’t like more work? Moreover, you know it’s easier to sell to existing customers than to find new ones. What’s the problem here? Sometimes, however, the large customer begins to make increasing demands for customization, reduced pricing, or quicker workflow. In a worst-case scenario, you wind up becoming more like an employee than an entrepreneur. You may even find the large buyer demanding changes or they will take their business elsewhere. You are forced into accommodating them, because they now provide too much of your revenue to let them go.
Remember the stories of the big box retailer who purchased appliances from a manufacturer, becoming its largest customer, and thereafter making demands that affect the profitability of the supplier? You don’t want to become such a story.
A better solution is to make sure that your eggs are spread amongst many baskets. Sometimes it’s okay for a customer to outgrow you. Rather than changing your business model, hiring employees, or redesigning your company to service one client, it may be better to let a customer go to a larger provider. There may be short-term pain, but less a risk of long-term disaster.