In mid-October 2026, Ukraine’s military suddenly lost reliable access to Starshield, the military-grade version of SpaceX’s Starlink network. Reports say service was limited for anything travelling faster than about 100 mph, hitting drones, aircraft and helicopters. US Secretary of State Marco Rubio later said Ukraine has no access for now and its future use is “under discussion”. Who made the call is still unclear: Elon Musk says the US military controls the limits, and President Trump says he didn’t order it.
Whatever your view of the politics, the lesson applies to almost every business and household: when someone else controls something you can’t function without, their decision becomes your crisis, and you don’t get a vote. In business, this is called customer concentration risk, and this guide shows you how to spot it and reduce it.
Key numbers at a glance
58%
of European NATO members’ arms imports came from the United States in 2021–25
22.3%
of everything the EU imported from outside the bloc in 2025 came from China
98%
of the EU’s rare-earth magnets come from China
65%
the EU’s new cap on any strategic raw material coming from one non-EU country by 2030
£2 billion
owed by Carillion to around 30,000 suppliers and subcontractors when it collapsed in 2018
£11 billion
the estimated yearly cost of late payments to the UK economy, linked to about 38 business closures a day
13.1 million
UK adults (24%) with low financial resilience in 2024
Europe’s wake-up call: three dependencies in numbers
Europe is learning the same lesson on a much bigger scale.
- Security. The United States supplied 58% of European NATO members’ arms imports in 2021–25, according to SIPRI, and European allies had 472 US combat aircraft on order at the end of 2024.
- Manufacturing. China is the EU’s largest source of imported goods, supplying 22.3% of everything the EU bought from outside the bloc in 2025 (Eurostat).
- Critical raw materials. The EU gets 98% of its rare-earth magnets, used in electric vehicles, wind turbines and fighter jets, from China (European Parliamentary Research Service).
Europe’s answer: it isn’t to stop trading; it’s to stop depending. Its Critical Raw Materials Act aims for no more than 65% of any strategic raw material to come from a single non-EU country by 2030. In other words, Europe has set itself a concentration limit. Your business can do the same.
The finance idea behind it all: concentration risk
Concentration risk is the danger of relying too heavily on one customer, supplier, funder or income source. Engineers call it a single point of failure. The catch is that it often feels like success: one big client means steady work and less time selling, and your accounts look just as healthy whether revenue comes from forty clients or one.
It hurts in three ways:
- Sudden loss. Revenue drops overnight while your costs stay the same.
- Lost bargaining power. A client who knows you depend on them can push down prices and stretch payment terms.
- Lower value. Lenders and buyers see concentrated revenue as riskier, which can mean tougher loan terms and a lower sale price.
How much is too much?
There’s no magic number, but advisers commonly use these rules of thumb:
| Share of revenue | What it means |
|---|---|
| One customer above 10% | Worth watching |
| One customer at 20–25% or more | A material risk |
| Top three customers above 50% | High concentration |
Check yours: divide each customer’s yearly revenue by your total revenue and multiply by 100.
Where concentration hides in your business
- Customers and funders. Clients in the same sector or funding stream can behave as one. A care provider funded mostly by one local authority is concentrated even if invoices go to different departments.
- Suppliers and outsourcing. Outsourcing is often smart, but core functions need a backup. When Carillion collapsed in 2018, it owed about £2 billion to around 30,000 suppliers and subcontractors, most of whom stood to recover little or nothing (House of Commons Library).
- Cash. A big customer that pays late can hurt almost as much as one that leaves. Government research estimates late payments cost the UK economy almost £11 billion a year and cause around 14,000 business closures, about 38 a day.
- People. If only one person can run payroll or access the bank account, they are a single point of failure too.
A worked example: when one client walks away
Imagine a business with £1 million in revenue, a 35% gross margin and £250,000 of fixed costs. Its largest client brings in £600,000 (60%).
| With the client | Without the client | |
|---|---|---|
| Revenue | £1,000,000 | £400,000 |
| Gross profit (35%) | £350,000 | £140,000 |
| Fixed costs | £250,000 | £250,000 |
| Profit / (loss) | £100,000 | (£110,000) |
The result: losing that client doesn’t cut profit by 60%. It turns a £100,000 profit into a £110,000 loss, about £9,200 a month.
Why it hits so hard: this is operating leverage. When most costs are fixed, lost revenue hits the bottom line hard. If the same client had been 30% of revenue, the loss would have been a manageable £5,000.
The same rule applies to your personal finances
For most people, their employer is their only customer. A stable job is valuable, but it’s still a concentration. And many households have little cushion: the Financial Conduct Authority found that 13.1 million UK adults (24%) had low financial resilience in 2024. Meanwhile, the number of UK workers with a second job hit a record of about 1.35 million in 2025 (ONS), partly a sign of financial pressure rather than ambition.
Before reaching for a side hustle, cover the basics:
- Cash buffer. Aim for three to six months of essential spending in an easy-access account.
- Portable skills. Build skills other employers would pay for; nobody can switch those off.
- Network. Keep it alive before you need it.
- Side income, carefully. Check your employment contract, and report self-employed income above the £1,000 trading allowance to HMRC.
Resilience has a cost, so spend it wisely
None of this means never relying on anyone. Specialisation and outsourcing save time and money, and every backup has a price.
The smart question: which dependencies could sink me, and what’s a sensible price to pay to protect against them? Like insurance, you protect the things you can’t afford to lose.
Your 30-day resilience check
- Week 1: List your top customers, suppliers, funders and key people, with each customer’s share of revenue and gross profit.
- Week 1: Flag anything above 20% of revenue or with no ready alternative.
- Week 2: Model what happens to profit and cash if your largest customer leaves or pays 60 days late.
- Week 2: Review notice periods, termination clauses and payment terms.
- Week 3: Line up second suppliers and write down key processes so more than one person can run them.
- Week 3: Set a target, such as no customer above 30% of revenue within 18 months.
- Week 4: Agree a cash reserve target, such as three months of fixed costs, then run the same check on your household.
Frequently asked questions
What is customer concentration risk?
The risk of earning a large share of your revenue from one customer or a small group. If they leave, pay late or demand better terms, you feel it straight away.
Is it bad to have one big client?
Not necessarily. Big clients can fund growth. The problem is having one without a plan: no cash buffer, no pipeline and no idea what happens if they leave.
What’s the difference between a Fractional CFO and an accountant?
An accountant keeps accurate records and meets tax deadlines. A Fractional CFO looks forward: forecasting, planning and managing risk. Many businesses use both.
Related reading: How to Reduce Your Company’s Tax Bill Legally in the UK
How a Credora Fractional CFO makes the difference
Knowing what to do is one thing; finding the time to do it while running a business is another. A Fractional CFO gives you senior financial leadership part-time, without the cost of a full-time hire.
Credora Consulting’s Fractional CFO service supports UK small and medium-sized businesses, with a particular focus on health and social care. In practice, that means:
- See your exposure: monthly management accounts showing revenue and margin by customer.
- Stress-test your plans: cash-flow forecasts and “what if” scenarios, so you know your runway before you need it.
- Protect your cash: budgets, credit control and cash-reserve targets.
- Grow the right work: margin analysis showing which clients to grow, reprice or renegotiate.
- Be funding-ready: reports and forecasts that lenders and investors trust.
For a care provider reliant on one local authority, that could mean a monthly dashboard of income by commissioner, a 13-week cash-flow forecast that flags pinch points early, and a realistic plan to grow other income.
Does one customer hold too much power over your business?
Book a free consultation with Credora Consulting and start reducing that risk.
Or email us at enquiries@credoraconsulting.co.uk
This article is for general information only, not financial advice, and reflects reporting and data available as at October 2026. Figures in the worked example are illustrative. Please seek advice on your own circumstances before acting.
Sources: Al Jazeera and The Hill, reporting on Starshield access in Ukraine (October 2026); SIPRI, Trends in International Arms Transfers, 2024 and 2025; Eurostat, EU trade in goods, 2025; European Parliamentary Research Service, China’s rare-earth export restrictions (November 2025); European Commission, Critical Raw Materials Act; House of Commons Library, The collapse of Carillion; Department for Business and Trade and Office of the Small Business Commissioner, late payments research (July 2025); Financial Conduct Authority, Financial Lives 2024 survey; Office for National Statistics, Employment in the UK, 2025; Lancaster University Work Foundation.