October 29, 2006

CAROL CAIN: Landing that one big client may not lead to happy ending

There may be a disadvantage to a small business if it lands a big client. Ed King, director of small business services at Wayne State University, says there are times when an increase in sales can be a bad thing. He has seen some firms get into trouble upon landing the big client. If a client represents more than 40 percent of a company's sales, that can pose a problem. "You may end up beholden to the whims of that firm. And, at that point, the customer truly begins to own the small business - lock, stock and barrel," says King, who advises small businesses to get rich slowly. "There is a thin line between fast, profitable growth and expansion through a client who will try to take over."

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