Sign in

Blog · Board and management reporting

Concentration by industry: where a large top-ten share is normal, and where it is risk

Concentration is measured the same way everywhere, top-n share, count to half, the index, and what a high figure means depends on the desk: normal in a category with a few large buyers, a dependency in one with many. This hub gives, for twelve industries, what is concentrated, on which axis, what a typical top-ten share looks like, when it is a strength and when it is a risk, and the guide for each.

By CoviragePublished 16 September 20263 min read
The short answerConcentration is top-n share, count to half and the index, and the axis differs by desk: customers, carriers, introducers, operators, intermediaries, advisers, suppliers. A top-ten share of 60 percent is ordinary for a supplier to a few health systems and alarming for a distributor with two thousand accounts. What makes it a risk is not the level but the dependency behind it: no contract, one contact, a shrinking trend, or a relationship the company does not own. The measure says where to look; the account's own detail says which it is.

Concentration is three measures and one question: how much of the book depends on how few. The axis and the meaning change by desk. This hub gives, for twelve industries, what is concentrated, on which axes, what a typical figure looks like, and when it is a strength or a risk, with the guide for each.

The measures, once

Top-n share = revenue from the largest n ÷ total Count to half = entities, largest first, to reach 50% Index = Σ (share)²

Per company, per segment, per person, on whichever axis the desk depends on.

Twelve desks

Industry Axes Typical top-ten share Strength when Risk when Guide
Distribution Customers 25 to 40% Contracted chains, multi-site One buyer, no contract Customer concentration
Healthcare supplies Health systems, GPOs 50 to 70% System-wide agreements One system, one contract renewal GPO compliance
Insurance broking Clients; carriers per line Clients 30%; carriers vary Partner carrier with appetite One market writing a line; appetite change Carrier concentration
Freight brokerage Shippers; carriers per lane Shippers 40%; lanes vary Contracted lane with a reliable carrier One carrier, acceptance falling Carrier concentration per lane
Wealth management Advisers; introducers Advisers per office vary Second relationships in place Sole relationships; one introducer Adviser concentration
Asset management Intermediaries per strategy 40 to 60% Platform on a recommended list Platform review; flows turning Redemption watch
Oilfield services Operators per basin 50 to 80% Multi-rig operators under contract One operator's programme Operator wallet
Supply chain Suppliers per part Single-source by design Dual-sourced critical parts Single source, rising lead-time spread Single-source parts
Professional services Clients per partner 30 to 50% per partner Multi-practice relationships One partner's one client Partner book concentration
Sports Partners by value 40 to 60% Multi-year, multi-asset partners One partner, expiring, under-delivered Renewal value against delivered value
Products Lines and SKUs Top ten lines 40 to 50% Core lines with breadth beneath Tail lines a top account depends on The product tail
SaaS Customers; cohorts 20 to 35% Expanding cohorts One cohort failing; one logo dominant Net revenue retention by cohort

What is the same everywhere

  • Three measures, computed on the ledger, per company and per person.
  • The trend outranks the level.
  • The roll-up identity is checked first; duplicates understate concentration.
  • The reading needs the account's detail: contract, breadth, contacts, trend.

What is different

The axis, and the structure of the market that sets what is normal. A desk with a few large buyers is concentrated by nature; the risk is in the dependency, not the share.

Where it goes wrong, everywhere

Level read without industry structure. Alarm in healthcare; complacency in distribution.

One axis. The broker sees clients and not carriers.

Company level only. The rep, adviser or partner with one relationship.

Read as bad news by default. Concentration in the right customer is what a good team produces.

Three measures, every desk

Covirage computes concentration on each desk's axes from the ledger, per company and per person, trended, with the roll-up checked. The customer concentration guide covers the measures in general form, and each desk's guide covers its axes.

Questions people ask

Is there a safe level?

No universal one. The comparison is the company's own history and its industry's structure. Rising concentration with a static customer count is the signal on every desk; the level at which a lender or acquirer worries varies with the industry.

Which axis?

Whichever the desk depends on. A broker's book is concentrated by client and by carrier; a wealth firm's by adviser and by introducer; a freight broker's by shipper and by carrier. The hub shows the axes per desk, and most desks have two.

How is healthy separated from dependent?

By the account's detail: contract term, sites and products, contacts, trend. A concentrated customer with a multi-year contract, several sites and three contacts is a strength. One with none of those is a dependency. The measure ranks; the detail decides.

Related reading

Board and management reporting

A board narrative with a citation on every number: how to draft the commercial pack from reconciled figures

A method for writing the quarterly commercial narrative so every figure carries a citation to the calculation that produced it: the reconciled roll-up as the source, the narrative structure, the citation format that survives export, and why the model writes sentences but never numbers.

16 Sept 20263 min readBoard and management reporting · Wealth managers

Adviser concentration: how much of the book leaves if one adviser does

How a wealth management firm measures the share of assets and revenue attached to each adviser, the client-level dependency behind it, the succession list of advisers whose books have no second relationship, and why the figure is reported per office and per team, not just for the firm.

16 Sept 20262 min readBoard and management reporting · Finance and FP&A teams

Automating the sales report: from a manual monthly pack to computed tables

A practical path for a sales operations or finance team that assembles the monthly sales report by hand: what to automate first, the definitions that have to be written down before anything can be computed, the four exports the whole pack comes from, the identity checks that replace the reconciliation week, what stays manual, and the order in which the pack's sections move from spreadsheet to computed table.

16 Sept 20263 min readBoard and management reporting · Shipping and logistics

Booking-to-invoice cycle per customer: the days revenue waits

How a forwarder measures the time from shipment delivery to invoice issued, per customer and per branch, from the shipment milestones and the billing ledger: the median days, the shipments delivered and still unbilled past a stated age, the value waiting, the branches and customers where the cycle is longest and why, disputed accessorials, missing carrier costs, customer billing rules, and the working capital the delay ties up.

16 Sept 20263 min read