You look around, it’s dark, cold and lonely. You’re in the belly of a 2-tonne hungry shark, and that big client just swallowed you whole.

You don’t realise it until it’s too late.

When starting Every Cloud I stumbled upon a few clients early on without lifting a finger with marketing.

After 4 months, I had three clients with sizable invoices and thought I had the Midas touch. I didn’t need a website, a logo, or to market because I already had income, I was busy.

Then for various reasons, all three clients stopped and I was left with zero income.

Oh s**t!

Starting again

I had to start from scratch. I had to set up a website, a blog and get a logo designed – it took a long time to get any real traction.

I set up the limited company in September 2022, but I class July 2023 as the real day one of building a business, a sustainable business.

It took a year to get the business back to a point where it could pay me a salary again.

Changing strategy

There was one huge change that I vowed to make so I could make sure the situation would never happen again.

No client should be worth more than 10% of my income.

Ideally each client would be in the range of 5-10%. The strategy is to focus on smaller recurring invoices rather than large individual ones.

The aim was to create a solid foundation, like a well-built Victorian house, where losing one client would not be detrimental to the business.

Keeping you awake at night

A good test of whether a client is too big is.. Do they keep you awake at night?

Are you lying in bed in the early hours of the morning, worrying about a client stopping working with you? Because whenever I have thoughts like that it highlights they may mean too much and represent a large portion of my business.

The benefits of smaller clients

Fast forward to today, my biggest client, depending on the month is around 12.5% of income, not quite at 10%, but as the business grows that figure will reduce. Much healthier and a lot less stressful.

I believe there are huge benefits to working with a higher volume of small clients, so no one client represents a huge portion of income:

  • Your income is spread more evenly so if a client drops out, it’s not going to have a catastrophic effect on your business.
  • You have balanced relationships; when a client becomes big, everyone knows it, the boundaries can blur, and the expectations can shift.
  • You have a higher volume of clients for feedback, reviews, and referrals.
  • You get to know your target market more, with more conversations to spot pain points, challenges, and opportunities.
  • It helps you sleep better at night, which is most important of all.

Do you have a job?

I feel much more comfortable with this model; it feels safe and sustainable with eggs in multiple baskets.

Do you know what one big client resembles?

A job.

And that’s not what we set up our business for – a lifestyle business thrives on freedom, autonomy and safety.

If all your income comes from one or a couple of major sources, that can disappear at any point, in the blink of an eye.

Imagine your client has a change in leadership, a difference in opinion, a cost-saving exercise or even enters liquidation, then the income has gone into thin air.

Build a solid foundation, so that if one brick moves, the house remains strong.

If you would like to work with an accountant who will support you in growing a lifestyle business with strong, sustainable foundations, book a discovery call today.