Key account

A customer important enough, by revenue, potential or strategic value, to get a named owner, a plan and its own review.

DefinitionA customer important enough, by revenue, potential or strategic value, to get a named owner, a plan and its own review.

A key account is a customer the business has decided to manage individually rather than as part of a territory or segment. It gets a named owner, a written account plan, regular executive contact and its own revenue and margin reporting. Selection should rest on current revenue and on potential, so that a large customer where you hold a small share of wallet can qualify too.

How it is computed

Rank accounts by revenue, gross margin or estimated potential, set a cutoff (a top N, or a revenue floor), and report the group's share of total revenue each period alongside its growth.

Example

Of 400 accounts with $14,000,000 of revenue, the top 25 bring in $6,300,000, which is 45% of the total. Those 25 become the key-account list.

Where it goes wrong

A list that never changes, so accounts stay on it after they shrink, and concentration risk that rises unnoticed as the list's share climbs. The full guide is key account management.

Articles that use this term

How-to guides · Finance and FP&A teams

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How to choose analytics software for hospitality: questions, data and traps

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Sales KPIs for builders' merchants and construction suppliers: ten measures that matter, each with its formula and the export it comes from

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Sep 17, 20264 min read Board and management reporting · Industrial distributors

Sales KPIs for industrial distributors: ten measures that matter, each with its formula and the export it comes from

The ten sales KPIs an industrial or MRO distributor should run on, each with its formula, the export it comes from and what it tells you: category penetration by branch, dormant accounts by prior value, quote conversion by count and value, lost lines from stock-outs, counter sales without an account, account coverage at cadence, price realization against contract, share of spend at key sites, reactivation rate, and contribution per customer. Also the three measures most industrial distributors miss, the figures to drop, the identities, and who owns what.

Sep 17, 20264 min read Territory, capacity and quota planning

Sales territory plan template: the six tables a territory plan needs, and the one page that holds them

A template for a sales territory plan that a rep can write in a day and a manager can check in ten minutes: the territory in numbers, the accounts tiered by value and potential, the coverage the tiers are owed against the time available, the growth list of named gaps, the retention list of named risks, and the target built up from those lists. This page gives each table, where its figures come from, the arithmetic that ties the plan to the quota, and a copyable one-page outline.

Sep 17, 20265 min read Territory, capacity and quota planning

Behavioral segmentation: B2B examples built from your own sales data

What behavioral segmentation is, how it differs from demographic, firmographic, geographic and psychographic segmentation, and how to build it from a B2B invoice ledger. Four written rules applied in order sort eight trade customers into broad, narrow, occasional and lapsing segments, with the check that the segments add back to the ledger and one sales action for each.

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