Top Customers

Do you know the true value of your top customers?
A. No, we don’t.
B. We can identify our top customers … just about.
C. We know the turnover value of our top customers.
D. We know the turnover value of our top customers and whether sales to them are increasing or declining.
E. We know the turnover value and profitability of our top customers and whether sales to them are increasing or declining.
[Score:  A=0, B=1, C=2, D=3 and E=4]
Why is this question important?

Key questions:

  • What are the total sales for each of your top 5 / 10 customers?
  • Are sales for each of your top 5 / 10 customers increasing or declining?
  • What is the profitability of each of your top 5 / 10 customers?

Remember sales are not the same thing as profit – you may have a very low margin with a key customer and in fact could well generate more ‘bottom-line’ with another customer with considerably lower turnover.

Hence the phrase – ‘top-line vanity (sales), bottom-line sanity (profit)’