Use one reporting period
Choose a complete, clearly labeled period. Use consistent treatment of returns, credits, and tax in both total sales and customer sales. Comparing a full year of sales with one customer’s partial year produces a misleading percentage.
Calculate the shares
Divide the largest customer’s sales by total sales and multiply by 100. Repeat for your five largest customers together. For example, $250,000 out of $1,000,000 is 25%. Our worksheet performs this arithmetic in your browser and does not send the figures to Old Growth.
Look behind the number
Does the account contain several independent locations or one purchasing decision? Is the work recurring, tied to a project, or dependent on a personal relationship? Are commitments documented? A single percentage cannot answer those questions.
Separate sales share from profit and cash flow
Sales concentration does not automatically show margin concentration, payment reliability, or the cost of serving the account. Add those questions to your discussion with an accountant or transaction adviser. Do not treat a lost-sales scenario as a forecast of lost profit.
Make a useful next-step note
Identify the relationship owner, supporting team members, agreements to locate, and any recent changes in demand. Consider what information a buyer would need to understand the account without disclosing customer identities in an initial inquiry.
TAKE ONE STEP
Your first deliverable: largest-customer and top-five shares, plus a short explanation of the relationships behind them.
This is a general planning resource, not a valuation or personalized legal, tax, or financial advice. Use it to organize a conversation with qualified advisers.
