A key account plan and concentration risk

A key account is a client whose loss would change your plan and who could still grow. Both conditions matter.

Size alone isn't enough. A big client that will never buy more and is easy to replace needs good service, not a plan of its own. A loyal client that is small and has nowhere to grow is valuable, but losing it wouldn't change the year. And a friendly contact on calls says nothing about weight or potential.

Veloria meets both conditions. In March 2027 it took 300 of Teams' 790 lessons, more than a third, and Pavlo has hinted that another team might join in the autumn. That is why it needs more than "keep Pavlo happy": it needs a plan.

The practical test: if this client left next month, would you have to rewrite the plan? And is there a realistic next step that would help them and grow the account? Two yeses make a key account.

A key account plan starts with a map, not a revenue target. A target without the map is a guess. The map has four parts:

• People and what each needs. At Veloria: Pavlo runs the program and is the champion, Yaryna (the finance director) owns the budget, Stepan (operations) guards the shifts, and the IT security lead signs off on tools.
• Goals: what the client is trying to achieve. Veloria wants fewer mistakes on calls with foreign carriers and in customs paperwork.
• Usage: how they use you today. 300 lessons a month for 40 learners, 92 % attendance in March.
• Next expansion: what would help them next. Another team in the autumn, still a hint rather than a request.

Each part gets a next step: a quarterly review with Yaryna, one agreed measure with Stepan's team, attendance watched by shift every month, a question to Pavlo about which team and what it needs.

The most common gap in an account plan is one thread: week to week, Teams talks only to Pavlo. If he left Veloria, or moved to another role, nobody there might remember why Klasna was chosen, and the renewal would start from zero with a budget owner who has never met you.

The fix is more threads, built through the champion, not around him. Ask Pavlo to invite Yaryna to a short quarterly review where Teams shows attendance and one result. Give Stepan results he can see in his own shift reports. Each new contact should get something useful, not a sales call.

Going around Pavlo, for example writing to Yaryna directly behind his back, damages the one relationship that works and makes him look bad inside his company. Waiting until he announces he's leaving is too late: new relationships take months.

Aim for a number and a date in the plan: two more people who know Teams well, by the summer.

Concentration risk is how much of your revenue and of your margin depends on one client. Measure it two ways.

Share: the client's lessons (or revenue, or contribution) ÷ the total. Veloria took 300 of Teams' 790 lessons in March: 300 ÷ 790 = 37.97 %.

Cost of losing it: what would disappear in a month. Revenue 300 × 800 = 240,000 UAH; contribution 300 × 339 = 101,700 UAH, or 1,220,400 a year. Contribution is the number that matters, because it is what pays Teams' salaries and overheads.

A share is a snapshot of one month. It moves as other clients start: once Cobalt joins in April, Veloria's share falls even though nothing about Veloria changes. So recompute it every month and read it together with the plan for the next few months, not as a fixed fact about the client.

A common slip is to divide by the wrong total, for example Veloria's lessons by the other clients' lessons only.

A client's share of revenue and its share of contribution are not always the same number, so check both.

At Teams today they coincide. Every client pays 800 UAH a lesson and costs the same to serve, so every lesson brings the same 339 of contribution. Both shares reduce to lessons ÷ total lessons: Veloria is 300 ÷ 790 = 37.97 % of revenue and of contribution.

They split apart as soon as clients differ. A client on a 10 % discount pays 720 a lesson but still costs 461 to serve, so it brings 259 instead of 339: its share of contribution falls below its share of revenue. A client that needs extra coordinator time or many no-show lessons paid to tutors has the same effect.

This matters for concentration: a big client that negotiated a discount may look like 38 % of revenue but be a smaller share of what actually pays the bills. And it can be the other way round for a full-price client among discounted ones.

A client at 37.97 % of lessons creates three real exposures.

• Money: if Veloria left, contribution would fall by 300 × 339 = 101,700 UAH a month.
• Capacity: tutors' hours booked for Veloria would suddenly be empty, and tutors might drift to other work.
• Power: the quieter risk. A client that big can ask for discounts, longer payment terms or custom work, and saying no feels dangerous. Without a plan, a key account slowly renegotiates its own terms.

Two things concentration does not do. It doesn't make Veloria's lessons less profitable: Veloria pays the same 800 as everyone, so each lesson still brings 339. And it doesn't oblige Teams to stop selling to Veloria until the share falls. The problem is dependence, not the client.

Name the exposures in the plan's risk row, each with an action, so the plan holds more than a scary number.

When one client is too big, the tempting levers are the wrong ones: turning down its growth, raising its price so it buys less, or locking it in with a long contract and heavy exit penalties. The first two lose margin and goodwill. The third breeds resentment at the next renewal and doesn't make Teams any less dependent.

The right lever is to grow everyone else. Dependence falls when the rest of the business grows: new clients in other segments, more lessons with the small ones. If Veloria adds another team in the autumn, welcome it, and push the pipeline outside logistics at the same time so its share still falls.

Inside Veloria, make the account sturdier rather than smaller: more people who know Teams, results the budget owner sees, a renewal conversation started early. And when Veloria asks for custom work, price it instead of giving it away, so size doesn't quietly turn into free extras.

Put the key account plan on one page: a row for each part of the map (people, goals, usage, next expansion) and a risk row, each with what you know and the next step. For Veloria the risk row reads: 37.97 % of March lessons and one person who knows Teams well; next steps, two more contacts by the summer and growth in other clients.

Write it so that Marta can read it and Pavlo could see it without blushing. No secret scores about people, no notes like "Pavlo: weak, easy to push": only what helps the client. A plan you'd be embarrassed to show the client usually describes a relationship you wouldn't want either.

Review it every quarter. Veloria's share will change as Cobalt and Orchid start, attendance moves, people change roles. Map first, number second, actions last.

How it fits together: a key account is defined by weight and growth, mapped by people and goals, and protected by more threads and a growing base. The next lesson turns to renewals, expansion and complaints.