Posts Tagged ‘Customer Default’

Risky Customers

Tuesday, October 26th, 2010

It is not just the banks that are too big to fail. Smaller US businesses that make components for large manufacturing companies were devastated by the reduction in orders during the economic downturn. When we think of supply chain risks, we typically think of our vulnerability to a single supplier that produces a component critical to the creation and delivery of our products. We rarely consider what happens when the customer fails. The Financial Times has an excellent article describing how the recession taught smaller businesses to diversify their customer bases. A Deloitte consultant quoted in the article offers good advice about the risk of having “too many eggs in the same basket.”