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I work as a web developer for a marketing agency (roughly 20 staff), recently I have become increasingly concerned that we only service a single customer.

I have mentioned the risk to my line manager and he has assured me that the company is safe and we can more than meet our financial obligations. However it still niggles me.

Is this a common occurrence, to only only have one customer? Are there any government/industry protections that deal with situations like this?

  • I wasn't sure what tags to use here. Please feel free suggest more relevant ones. – user5451386 Sep 15 '17 at 10:37
  • It's a small company, but is it a young company? Maybe the company is finding its feet or looking to hire more people before expanding and adding new clients? – user34587 Sep 15 '17 at 11:09
  • Its common for a small company to have one client, it is also dangerous for obvious reasons. – Neo Sep 15 '17 at 14:06
  • If your underlying question is whether you should be worried, then consider what you think would serve the interests of the management/owners. If this company is ambitious and would like to grow, then you can be sure that this challenge is frequently discussed since it is a significant risk to the business. Similarly, if the company has a long history and a good name then there is something to protect. If not then the plan might be to let the company fail if the customer disappears. – JonathanS Sep 18 '17 at 8:07
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It's not something I would consider common but it's not unheard of either. What is fairly common is for a company to have a significant portion of it's business come from one major customer.

I've worked for at least a couple of companies where whole teams/whole departments existed solely to service a large customer and were that customer to go away for whatever reason then it would leave a serious shortfall in income for the business and it would be quite likely to result in those employees losing their jobs unless a suitable replacement customer could be found quite quickly. Neither of these scenarios is inherently a bad thing, and each instance would have to be judged on the risk vs reward balance for that particular case.

Ideally a business in such a situation would have financial buffers and contingency plans in place to allow it to survive such a loss but in reality this isn't always possible or even considered. About all you can do is keep a general eye out for any signs that the customer might be about to leave (or go under or anything else that would result in them no longer providing as much business for your company) and where possible make sure your own personal situation is as best prepared for it to go sideways on you, but that's the same for anyone really and I appreciate that it's easier said than done!

As for the second part of your question:

Are there any government/industry protections that deal with situations like this?

Pretty much "No". The government may step in to protect a business from failing if there likely to be wider implications for the country's populace or economy (e.g. the Northern Rock "failure" ~10 years ago) but such circumstances are rare and a small marketing agency such as your employer could go under and while it would be awful for the staff and their dependents the country/economy as a whole wouldn't even notice.

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    With this in mind, it could be useful for the OP to inquire if there's any contingency plan in place for such a case, but that sort of inquiry would have to be quite carefully worded since it's probably not within the domain of responsibilities of the OP, so they may be seen as meddling with something they have no business in meddling with. – Cronax Sep 15 '17 at 11:17
  • @Cronax To be honest I doubt he would get a meaningful answer out of them because in my experience it's rare for upper management to share that sort of detailed information with "ordinary" employees, and as you say it may be taken as meddling or, worse an indicator that the OP was looking to jump ship. – motosubatsu Sep 15 '17 at 11:37
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    @motosubatsu Well, if I were the OP, I'd make up an "exit-strategy" soon. Like yesterday. – Fildor Sep 15 '17 at 15:07
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Is this a common occurrence, to only only have one customer?

No.

Depending on a single customer is very, very risky for obvious reasons.

Most businesses avoid that situation. While it may be unavoidable for young companies, most try hard to change the situation as soon as they can.

Are there any government/industry protections that deal with situations like this?

In the US, the government does not attempt to prevent businesses from making foolish mistakes like this.

I don't know of any industry that provides any sort of "protection" from such behavior. I can't imagine what such protection could be, even if they wanted to do so.

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    Monopsonies (single buyer markets) are actually not uncommon, and are typically heavily regulated or actually created by regulation (eg farm boards). The OP's marketing agency obviously doesn't qualify though! – lambshaanxy Sep 16 '17 at 2:02

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