2 min read
Reduce concentration
If one customer is a large share of turnover, their failure is an existential risk. Win new accounts to dilute the exposure, and read customer concentration risk to see how lenders view it.
Contain the loss
Shorten payment terms and monitor a key account’s credit health for warning signs. Trade credit insurance can cover a bad debt, and a cash buffer or standby facility bridges the gap while you recover.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. A standby facility with no personal guarantee gives you a shock-absorber if a big customer fails. See business loans or apply online.
Frequently asked questions
How much of my turnover should one customer be?
There is no fixed rule, but the more concentrated your revenue, the higher the risk. Diversifying so no single customer can sink you is the goal.
Does insurance cover a customer going bust?
Trade credit insurance can cover a bad debt from an insolvent customer, subject to the policy. It is one layer alongside diversification and a cash buffer.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.