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Glossary

Natural concentration

How much of a customer's wallet the largest supplier usually holds in a category, from the company's own customers where wallets are known. The ceiling a share of wallet can reasonably reach; 45 percent is excellent where the ceiling is 50 and poor where it is 90.

DefinitionHow much of a customer's wallet the largest supplier usually holds in a category, from the company's own customers where wallets are known. The ceiling a share of wallet can reasonably reach; 45 percent is excellent where the ceiling is 50 and poor where it is 90.

Per category

Brokers' clients use five markets; distributors' customers use one. One target for both punishes the first for physics.

Whoever the supplier is

The measure is the largest supplier's share, not the company's. It describes the category, not the relationship.

How it is computed

From the company's own customers, the share of a category's spend that the largest supplier typically holds, used as the ceiling when valuing a gap.

Example

Where customers disclose their spend, the lead supplier usually holds about 70 percent of fixings. A customer's gap is valued up to 70 percent of its estimated spend, not 100.

Where it goes wrong

Gaps valued as if the customer would buy everything from one supplier. Few do, and the target is unreachable.