An agency nearly collapsed when one client represented 80% of revenue, then pulled 60% of the work in-house. The speakers explain why service businesses struggle to replace that income fast enough and how to avoid betting everything on a single client.
Chapters
How many times in that period do you reckon you had a business near-death experience? I can think of one. Was it just the one? Yeah, there was one major one.
A lot of businesses I learned along the way, their initial growth comes from, in the agency world, one primary client account. You know, you service really well, do amazing work for, and it just grows. And you get into this position whereby you don't want to turn the work down because you're delivering great value and it's silly to turn the work down. It's physically impossible to try and fill the other half of the agency or another equivalent amount of work. So I think there was a time where we about 80% of our revenue coming from one customer, which was massive. And we always knew this customer wanted to in-house the work that we did for them, and we were kind of supporting them on that journey. But as much as we tried, we couldn't find the equivalent amount of work outside of that customer to kind of bring the revenue attribution down quickly enough before they did in-house. And I think when they in-housed the work, they were about 60% of our revenue.