Are all your proverbial eggs in one basket? For most companies, 80% of revenue is generated by 20% of clients, according to the Pareto principle. That means, if you have a total of ten clients, two of those clients are largely responsible for keeping your business afloat. If one of those two clients leave, your revenues will decrease by 40%. That’s a hefty loss for any business to overcome.
This is even more true when it comes to industry focus. Many small or medium sized businesses focus on only a few industries. If, for example, you only serve five industries and the one industry that represents 80% of your revenue completely moves offshore, you are likely going to go out of business.
At Access/Information, we understand how important client and industry diversification is. When a client approached us looking for help because its primary market served was consolidating and moving offshore, we knew we had to move quickly to provide the client with the research they needed to make a strategic decision to keep the business moving in the right direction.
Specializing in applications for complex products and processes, as well as training for implementation across all user touchpoints in highly regulated industries, the client was considering expanding into two very large areas: financial services and manufacturing.
“Jessica’s interaction with us was great and she provided us with exactly what we were looking for.” – CEO of Complex Process Outsourcing Partner
To narrow down the targeted field, our team of expert researchers, using a proprietary dataset tool was able to identify segments fitting the specified profile within the financial services and manufacturing industries. To isolate the markets with the best growth opportunities, we narrowed our results to segments that were increasing at a rate higher than the national GDP.
To become an established player in a new market, it is vital to locate gaps in services or underserved areas. While at first glance, a segment may appear to be a good fit, further research can indicate that it is facing the same competitive pressures that you are currently operating in.
Through our analysis, Access/Information was able to determine that there was an opportunity serving manufacturers in the navigation of certain complex procedures. In addition, we were able to point our client to resources to continually monitor trending industries and identify actual prospects that are highly motivated to purchase our client’s services.
Are you concerned about client diversification but unsure of the direction to go in? We can provide with you with the information you need.