analyze-revenue-concentration

name	analyze-revenue-concentration
category	data
description	Analyze revenue concentration across customers, related groups, products, channels, regions, and contracts with reconciled exposure and stress cases. Use when assessing dependency, resilience, or diversification.

analyze-revenue-concentration

Measure both the share of revenue and the practical difficulty of replacing it.

When to use

• Use for customer-risk review, planning, diligence, lender reporting, or diversification decisions.
• Do not expose personal data or make unsupported credit, employment, or service decisions from concentration alone.

Preconditions

• Define revenue basis, reporting period, entities, currencies, segmentation, and permitted audience.
• Obtain reconciled invoice or revenue data plus contract, margin, renewal, and collection evidence where authorized.

Procedure

1. Reconcile net revenue to the approved financial report after credits, refunds, taxes, and intercompany exclusions.
2. Resolve related customer entities using a documented mapping while preserving source identifiers.
3. Calculate share by customer group, product, channel, region, contract type, and other relevant dimensions.
4. Report top-one, top-five, and top-ten shares and a concentration index when it helps comparison.
5. Add gross margin, contract duration, renewal date, backlog, churn history, receivables, and switching constraints.
6. Distinguish structural concentration from temporary campaign, acquisition, or seasonal effects.
7. Stress the loss, reduction, delay, or price renegotiation of major relationships.
8. Identify mitigations with cost, lead time, owner, dependencies, and unintended consequences.
9. Validate results against customer owners without changing source data to fit anecdotes.

Worked example

One customer appears to represent 14% of revenue, but three separately billed subsidiaries belong to the same group. The mapped exposure is 31%, with lower-than-average margin and a renewal in four months. A stress case quantifies cash and capacity effects, while the report limits account-level detail to approved leaders.

Done

• A concentration analysis report reconciles revenue and records group mappings, segments, shares, margins, contract factors, and time trends
• Stress cases and mitigation actions are checked, with privacy controls, assumptions, owners, costs, and lead times documented